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Midwest Weather

Mixed Grains Outlook

Grains are mixed. SX is unchanged and near 9.14. CU is down 2 cents and near 3.24. Key to prices is next week US Midwest weather. WZ is up 5 cents and near 5.22. KWZ is up 3 cents and near 4.44. There is talk that China may have bought 2-3 cargoes of US PNW wheat. US stocks are moderately higher. US Dollar is mixed. Crude is lower. Gold is lower. There is talk of a compromise for a new US aid package.

Chinese Ag futures (January) settled up 96 yuan in soybeans, down 7 in Corn, down 21 in Soymeal, up 54 in Soyoil, and up 46 in Palm Oil. Malaysian palm oil prices were up 29 ringgit at 2,740 (basis November) following Chinese vegoil markets and awaiting domestic export data.

The 6 to 10 day forecast for the US Midwest continues with mostly light rainfall for the region as models are mixed with coverage and rainfall amounts. Temps run from below to above average over the period. The 11 to 16 day forecast for the Midwest is mixed between the models with the European now turning towards average rainfall and below average temp. The GFS having average temps and average to below average precip? Argentina is still dry.

No new high-level trade talks have been scheduled between the United States and China but the two sides remain in touch about implementing a Phase 1 deal, the White House Chief of Staff said; U.S. President Donald Trump earlier told reporters during a visit to Yuma, Arizona, that he had postponed an Aug. 15 review of the trade agreement signed with China in January given his frustration over Beijing’s handling of the coronavirus pandemic.

Pro Farmer tour participant estimated IN 2020 corn yield near 179.8 versus their estimate last year of 161.4 and USDA August guess of 188.0. Pro Farmer tour participant estimated NE 2020 corn yield near 175.1 versus their estimate last year of 172.5 and USDA August guess of 191.0.Both states had soybean pod count were above last year and 3 year average.

Chinese buyers struck deals to buy 195,000 tons of American corn, the USDA said on Tuesday, as China grapples with spiking domestic prices. China’s demand for corn to feed animals has increased as its pig herd has rebounded more quickly than expected from a deadly swine disease first detected in the country two years ago. Chicken producers are also pushing ahead with aggressive expansion plans. Chinese corn inventories have dwindled following years of government efforts to whittle down a previously massive stockpile.

Corn prices now up to figuring out Iowa corn crop losses, Argentina weather and Ukraine. There is still too much corn in World. There is also too much wheat in the World.

Managed funds were net sellers of 8,000 contracts of SRW Wheat; net sold 15,000 Corn; sold 2,000 Soybeans; net sold 2,000 lots of Soymeal, and; bought 3,000 Soyoil. We estimate Managed Money net short 10,000 contracts of SRW Wheat; short 110,000 Corn; net long 58,000 Soybeans; net short 18,000 lots of Soymeal, and; long 62,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures down roughly 6,700 contracts; HRW Wheat down 385; Corn down 20,100; Soybeans up 5,200 contracts; Soymeal down 20 lots, and; Soyoil up 4,600.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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