Written Commentary
MORNING AG OUTLOOK
USDA report day. Grains are mixed. SN is up 6 cents and near 13.69. SMN is near 405.0. BON is near 52.91. CN is down 3 cents and near 6.06. WN is down 2 cents and near 6.23. KWN is down 9 cents and near 7.95. MWN is down 8 cents and near 8.07. US stocks are lower. US Dollar is higher. Crude is higher.
USDA is not expected to make major changes to US soybean numbers today. US 2022/23 soybean carryout is est at 223 mil bu vs 215 in May. In one of the more interesting rumors to date, there is talk of US soybean being exported to EU for the purpose of crushing for soyoil. The soyoil would then be exported back to the US. Higher demand for US bio diesel and slow US farmer selling could be testing US crush capacity. BON has quietly rallied from May 31 low of 44.53 to overnight high of 53.02. There is also talk of crackdown of fraudulent use on used cooking oil. Still, US soybean export commit is down 15 pct vs ly. 39 pct of US soybean area is in drought up 10 pct vs last week.
Corn futures are lower. Talk of rains next week across parts of US Midwest and lower export demand offers resistance to futures. US corn export commit remains down 36 pct vs ly. There is talk S Korea may have bought SA corn. Trade est US 2022/23 corn carryout at 1,449 mil bu vs 1,417 in May. CN-CU spread is making new highs for move near +77 on slow farmer selling. Contract high was made in May, 2022 near +103. Ukraine corn prices are lower on outlook of higher EU feed grain supply vs ly and lower demand for Ukraine exports. Drop in prices despite talk of lower acres due to flooding. 45 pct of US corn area is in drought up 10 pct vs last week.
Wheat futures are lower. There remains a volatile WN trend between 6.00-6.50. KWN broad range of 7.60-8.50 and recent 7.80-8.10 and MWN 7.78-8.38. USDA is not expected to make major changes in today’s numbers. There remains a worry over wheat crops in North America, EU, Russia, Ukraine and Australia. US wheat export commit is down 17 pct vs ly vs USDA est of a 6 pct drop. Higher Russia supply and lower Russia prices offsets worry about lower crops.
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