Apr 11 Afternoon Ag Commentary

by ADMIS Research Team

SOYBEANS

July soybeans have pushed down to 909 down 6 ¼ cents at mid-session on a weak export sales number this morning. Net weekly export sales for soybeans came in well below the estimates at 270,400 metric tonnes for the current marketing year and 10,000 for the next marketing year for a total of 280,400. There were no China sales this week and a cancellation of 99,300 tonnes by Unknown. As of April 4, cumulative soybean sales stand at 86.0% of the USDA forecast for 2018/2019 (Current) Marketing Year versus a 5 year average of 93.5%. Sales of 332,000 metric tonnes are needed each week to reach the USDA forecast. July soybean meal is trading down $2.60 at $311.20 and July soybean oil is down .10 points at 28.28.Net meal sales came in at 152,200 metric tonnes for the current marketing year and 500 for the next marketing year for a total of 152,700. As of April 4, cumulative soybean meal sales stand at 76.0% of the USDA forecast for 2018/2019 (current) marketing year versus a 5 year average of 79.7%. Sales of 117,000 metric tonnes are needed each week to reach the USDA forecast. Net oil sales came in at 33,800 metric tonnes for the current marketing year and none for the next marketing year for a total of 33,800. As of April 4, cumulative soybean oil sales stand at 60.6% of the USDA forecast for 2018/2019 (current) marketing year versus a 5 year average of 68.4%. Sales of 15,600 metric tonnes are needed each week to reach the USDA forecast.

Traders see Brazil exports for the month of April sluggish and down to the lowest for April in for four years. Conab pegged Brazil’s soybean production at 113.8 million tonnes versus trade expectations for 114.8 million tonnes and up from last month’s estimate of 113.5 million. The USDA estimate is at 117.0 million tonnes. The Rosario exchange raised Argentina’s soybean production to 56.0 million tonnes versus 54.0 million previously and compared to the latest USDA estimate at 55.0 million tonnes. The open interest in soybeans went down 4,557 contracts on Wednesday with soybean meal up 1,388 contracts and soybean oil down 4,309 contracts.

 Soybeans Apr 11 Daily Chart

 

CORN

July corn has traded in a narrow 2 ½ cent range so far today with the market at 370 down ¾ cent at mid-day. Conab estimated the Brazil corn production at 94.0 million tonnes this morning compared with the USDA forecast for 96.0 million tonnes and from 80.7 million last year. This also was below pre-report estimates at 114.8 million. The Rosario Exchange pegged Argentina’s corn production at 48.0 million tonnes compared to 47.3 million previously and compared to the latest USDA estimate at 47.0 million. Today’s net weekly export sales for corn were below estimates coming in at 548,000 metric tonnes for the current marketing year and none for the next marketing year for a total of 548,000. As of April 4, cumulative corn sales stand at 74.9% of the USDA forecast for 2018/2019 (current) marketing year versus a 5 year average of 80.0%. Sales of 667,000 metric tonnes are needed each week to reach the USDA forecast.

The continued uncertainty of a US/China trade deal continues to test trader’s patience. However, there were some positive developments reported yesterday by Treasury Secretary Mnuchin on agreements with the enforcement mechanism as well as the establishment of new enforcement offices for both countries. Secretary of Agriculture Perdue commented Tuesday that China and the US have discussed reducing ethanol tariffs and anti-dumping duties regarding DDGs. The winter storm across the Dakotas, Nebraska and Minnesota continues with snowfall totals near 12-24 inches which will keep producers out of fields into late April. Last year was also wet April with delayed plantings, but was followed by a very warm and dry May. The odds of another perfect May weather scenario seems low. The open interest in corn went up 4,227 contracts on Wednesday. 

 Apr 11 Corn Daily Chart

WHEAT

Wheat prices have firmed this morning as weather issues are starting to take notice. Chicago July wheat is trading 3 ½ cents higher at 465 at mid-day with Kansas City July up 5 ¼ cents at 438. Minneapolis July wheat is trading 3 cents higher at 540 but was up as much as 8 ¼ cents earlier in the session. Blizzard conditions with howling winds have spread across the Great Plains and parts of the Midwest. More than two feet of snow is expected in South Dakota and a foot of snow in Minnesota. Spring wheat planting progress will struggle with the late-season winter storm. Dryness in Spain, France, Italy and Germany has also grabbed trader’s attention today. Strategie Grains has reduced EU wheat production to 144.8 million tonnes from 146.1 million previously. However, this would still be 14% above last year’s 127.2 million tonnes. They also cut barley production to 61.0 million tonnes from 61.8 million previously. France, the EU’s largest grain producer, has seen below average rainfall in most of the country which has raised concerns especially after last year’s drought.

Net weekly export sales for wheat came in near estimates at 273,000 metric tonnes for the current marketing year and 201,400 for the next marketing year for a total of 474,400. As of April 4, cumulative wheat sales stand at 95.6% of the USDA forecast for 2018/2019 (current) marketing year versus a 5 year average of 95.1%. Sales of 136,000 metric tonnes are needed each week to reach the USDA forecast. Algeria’s wheat tender results are expected later today. Cofco International announced on their website that they plan on doubling grain purchases from Black Sea nations over the next 2 to 3 years. The move is to expand globally and serve markets beyond China. The open interest in Chicago went up 5,385 contracts on Wednesday with Kansas City down 6,502 contracts.

Wheat Apr 11 Daily Chart

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2019-04-11T20:06:37+00:00 April 11th, 2019|