August 15 Afternoon Comments

By ADMIS Research Team

SOYBEANS

November soybeans pushed up to a three day high at 884 early in the session but retraced most of yesterday’s rally as it traded at 872 down 7 ¾ cents at mid-session. The soy complex was led by soybean meal this week but December soybean meal was down $4.50 at $333.30 at mid-day. The Argentine government’s decision to delay tax rebates on soybean meal and soybean oil exports for six months yesterday supported the soymeal market. This should help to balance the country’s budget by 2020 in order to meet the terms set by the International Monetary Fund as part of a $50 billion credit line. Weakness is attributed to active rainfall falling in Missouri and Iowa earlier this morning and moving east into Illinois and Indiana. The latest GFS precipitation map has 1.5 to 3.0 inch rains over the entire Midwest through August 22nd. Today’s July NOPA crush will be released this afternoon with the average estimate at 161.4 million bushels (155.0-164.3 range) versus 159.2 million in June and compared to 144.7 million bushels last year. Oil stocks are estimated at 1.738 billion pounds (1.625-1.789 range) versus 1.766 billion pounds in June. China sold 127,270 tonnes of soybeans out of 302,139 tonnes offered at state auctions today according to the National Grain Trade Center. Total sales since the auctions started in mid-July are 1.22 million tonnes. The open interest in soybeans went down 1,508 contracts on Tuesday with soybean meal up 5,288 contracts and soybean oil up 2,997 contracts.

Soybean Futures Contract

CORN

December corn traded both sides of unchanged today and was at 375 ¼ down 1 ¼ cents at mid-day. Rainfall is moving across the Midwest this morning which could improve late developing corn crops. Weaker wheat and soybean markets have also pressured corn so far today. The latest GFS precipitation forecast has the potential for 2 inch plus rains from Kansas, Nebraska, Missouri, southern Iowa, Illinois, Indiana and Ohio over the next seven days. The latest 6-10 and 8-14 day outlooks are also noticeably cooler and wetter for the majority of the Midwest from August 20th through August 28th. Ethanol production for the week ending August 10 averaged 1.072 million barrels per day. This is down 2.55% vs. last week and up 1.23% vs. last year. Total ethanol production for the week was 7.504 million barrels. Corn used in last week’s production is estimated at 111.8 million bushels. This crop year’s cumulative corn used for ethanol production for this crop year is 5.46 billion bushels. Corn use needs to average 65.984 million bushels per week to meet this crop year’s USDA estimate of 5.6 billion bushels. Stocks as of August 10 were 23.017 million barrels. This is up 0.41% vs. last week and up 5.45% vs. last year. The open interest in corn went up 379 contracts on Tuesday.

WHEAT

Wheat markets pulled back today following a weaker Matif futures market. Matif December futures are down 0.5% and traded to a two week low earlier in the session. Chicago September is down 9 cents at 532 ¾ at mid-session with Kansas City down 8 cents at 537 ¾. Iraq bought 300,000 tonnes of wheat from the US, Canada and Australia. World production levels are still in question and should provide underlying support on further weakness. Egypt’s wheat purchase yesterday signals there are supply concerns from the world’s largest importer as they look to accelerate purchases. Argentine wheat production may surpass 20.0 million tonnes according to grain exporter Ciara-Cec. This is slightly higher than the preliminary estimate from the Buenos Aires Exchange of 19.1 million tonnes. This could open up the possibility of Argentine wheat exports into Mexico. The open interest in Chicago went down 144 contracts on Tuesday and Kansas City went up 49 contracts.

Wheat Futures Contract

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2018-08-15T20:21:36+00:00 August 15th, 2018|