Written Commentary
MORNING OUTLOOK
Grains are mixed. SX is up 14 cents and near 15.02. SMZ is near 433.8. BOZ is near 67.67. CZ is up 1 cent and near 6.97. WZ is up 13 cents and near 8.72. KWZ is up 12 cents and near 9.39. MWZ is up 5 cents and near 9.31.
US Dollar is lower. US stocks are higher. Crude is higher. Gold, silver, coffee, cocoa and cotton are higher. Key US inflation data today.
USDA surprised the market with lower than expected estimate of the US 2022 soybean crop. Total US 2022/23 supply is down 138 mil bu from August. USDA dropped US exports 70 mil bu and crush 20 mil bu to get to a carryout of 200 mil bu. Question is, are futures high enough to ration the demand USDA dropped? USDA dropped US soybean crop rating 1 pct to 56 G/E. Weekly IS export inspections were lower than expected. USDA export sales on Thursday key to estimating export demand. Argentina soybean, soymeal and soyoil export prices are below US. Dalian futures reopened sharply higher in catching up with US futures gains.
Corn futures rallied to near 7.00 CZ after USDA dropped the US 2022 corn crop 415 mil bu from August. USDA dropped feed use 100, ethanol 50 and exports 100 to get to a carryout near 1,219. USDA also lowered weekly US corn rating 1 pct to 53 with 5 pct of crop harvest. USDA increased non US and China World corn crop 8 mmt and lowered EU only 1.2 mmt. USDA raised Ukraine corn crop 1.5 mmt and exports .5 mmt to 13.0. Key is if Russia renews the open export corridor deal.
Wheat prices dropped after USDA raised World wheat crop 4 mmt and carryout 1 mmt. USDA raised Russia crop 3 mmt and Ukraine 1 mmt. USDA kept India wheat exports at 6.5 mmt despite India ban on new wheat and flour exports. News India also banned new rice exports could support World wheat prices. Dry US south plains could also be supportive with US 2022/23 HRW ending stocks down 97 mil bu from last year.
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