Lower Grains This AM
Grains are lower. SX is down 12 cents and near 10.02. SMZ is near 31.4. BOZ is near 32.16. CZ is down 5 cents and near 3.63. WZ is down 6 cents and near 5.43. KWZ is down 5 cents and near 4.79. US stocks are higher. Crude is mixed. There may be concern about virus reducing global energy demand and state of global economy. US Dollar is higher. Gold is lower. Higher US Dollar is offering resistance to Gold prices and near 2 month high.
Chinese Ag futures settled up 1 yuan in soybeans, down 15 in Corn, down 6 in Soymeal, down 174 in Soyoil, and down 172 in Palm Oil. Malaysian palm oil prices were down 62 ringgit at 2,799 at midsession, a two week low as weaker rival vegoils, rising output, and political uncertainty weighed on the market.
The 6 to 10 day forecast for the US Midwest will see a front working through Monday into Tuesday bringing light to moderate rainfall mostly favoring the northeast Midwest. Temps will be above average over the next 4 to 5 days but, with those fronts, temps will be falling to below average early next week.
The Southern Plains over the 6 to 10 day period sees little to no rains for most of the region. Temps will be above average over the next 4 to 5 days falling to average in the west and below average in the east towards the later end of the 10 day period.
Seasonal showers normally begin in center-south and center-west Brazil during the second half of September. This week’s scattered showers were thought of as being the start of seasonal precipitation. However, a drier than usual weather pattern is expected over the next ten days to two weeks and could last a little longer.
The forecast has not changed with most of the European continent getting rain at one time or another during the next two weeks. The moisture boost will prove favorable for winter crop planting in many areas. Relief in parts of Ukraine from dryness will help improve winter crop planting conditions, although more rain will be needed. Russia remains dry.
The player sheet had funds net sellers of 8,000 contracts of SRW Wheat; net sold 1,000 Corn; sold 4,000 Soybeans; bought 4,000 Soymeal, and; net sold 5,000 Soyoil. We estimate Managed Money net long 20,000 contracts of SRW Wheat; long 65,000 Corn; net long 219,000 Soybeans; net long 67,000 lots of Soymeal, and; long 86,000 Soyoil.
The recent rally is soymeal prices was linked to concern about Argentina 2021 soybean crop. This pushed soybean board crush margins to highest level since April. Argentina lowered their soybean crop estimate to 46.5 mmt versus USDA53.5. Trade now will be watching US soybean harvest yield and SA weather for direction. SX is back to where some feel there is some new demand buying. Still, will China buy?
Corn prices are on the defensive following lower macro markets and higher US Dollar. Trade will be watching for US harvest corn yields and any new China buying for direction. Argentina lowered their corn crop estimate to 47.0 mmt versus USDA 50.0 due to dryness and reduce acres due to lower farmer profit outlook.
Lower wheat futures linked in part to talk of better west Europe and Ukraine rains. This despite ongoing dryness in Russia. Argentina lowered their wheat crop estimate to 17.5 mmt versus USDA 19.5.ArgentianPeso is at all time low and Ruble is at 5 month low. Russia wheat prices are no longer lowest in World. Russian farmer remains reluctant seller due to dry conditions.
On Wednesday Managed funds were net sellers of 8,000 contracts of SRW Wheat; net sold 1,000 Corn; sold 4,000 Soybeans; bought 4,000 Soymeal, and; net sold 5,000 Soyoil. We estimate Managed Money net long 20,000 contracts of SRW Wheat; long 65,000 Corn; net long 219,000 Soybeans; net long 67,000 lots of Soymeal, and; long 86,000 Soyoil.
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