Explore Special Offers & White Papers from ADMIS

Ag Market View for Feb 10.22


Soybeans ended lower. Some feel market bought into USDA February report and was shocked today to see CONAB low estimate of Brazil 2022 soybean crop. Fund buying and short covering rallied SH to 16.33 only to fade at the close to 15.71. Some feel at the end of the day, managed funds sold 11,000 soybeans, 5,000 soymeal and bought 2,000 soyoil. USDA lowered US 2021/22 soybean carryout to 325 mil bu due to a 25 mil b u increase in crush. They left exports at 2,050 vs 2,261 ly. Some are confused why USDA did not increase US exports with their estimate of South America soybean crop down 140 mil bu and with CONAB 125 mmt estimate could be down 510 mil bu. Argentina weather looks warm and dry which suggest their crop could be lower than 45 mmt. One group could see US 2021/22 soybean carryout near 215, US 2022 acres at 89.0, yield at 51.5 and 2022/23 carryout at 75 with an average farm price near 17.25 vs 13.00 this year and 10.80 last year.


Corn futures ended lower. Talk of lower South America corn supply and uncertainty over the future of Black Sea corn exports offered support to futures. CH tested 6.62 on fund buying and sharp gains in soybeans and soymeal. Low weekly US corn export sales, increase in US farmer selling near session highs and fact USDA failed to change US 2021/22 corn supply and demand offered resistance. CH hit sell stops below 6.50 and ended near 6.41. Volatility will only increase as World 2021/22 corn supply tightens and trade begins to look forward at US 2022 crop year. Weekly US corn export sales were only 589 mt or 23 mil bu. Total commit is 45.7 mmt vs 57.5 ly or 1,750 mil bu vs 2,265 ly. China commit is 12.0 mmt or 470 mil bu, Mexico 13.5 mmt or 530 mil bu and Canada 3.3 mmt or 130 mil bu.  There was no confirmation of yesterdays rumor that China had bought 2 mmt of US corn. USDA estimates Brazil plus Argentina’s 2022 corn crop at 168 mmt or 6,610 mil bu vs 138 ly or 5,540 mil bu. Some feel final crop could be closer to 156 mmt or 6,140. Like soybeans where will trade find 160 mil bu of corn? Brazil second crop will not be available until July. Some estimate US 2021/22 corn use for ethanol up 75 mil bu and exports up 225 which would suggest a carryout closer to 1,200 than USDA 1,540. Same group could see US 2022 acres at 91.0, yield at 180.5 and 2022/23 carryout at 1,100 with an average farm price near 6.40 vs 5.45 this year and 4.53 last year.

Farmer in crop rows


Wheat futures followed the rally in corn and soybean and then the break into the close. Rally was despite fact USDA raised US 2021/22 wheat carryout on Wednesday, did not increase World demand or drop World supply as much as some are looking for and poor weekly US wheat export sales. WH rallied to 8.01 when CH was near 6.62 and SH was near 16.33. KWH rallied to 8.30 and MWH rallied to 9.78. WH tested 7.65 and ended near 7.71 when CH ended near 6.41 and SH ended near 15.74. KWH ended near 7.99 and MWH ended near 9.42. Wheat futures will continue to be a follower until more is known about 2022 Black Sea exports, global wheat import demand and US 2022 weather. USDA est World 2021/22 wheat crop near 776 mmt vs 776 last year, Total domestic demand near 788 vs 782 last year end stocks near 278 vs 289 ly. Of the total, China is 142 mmt or 51 pct. Exporting countries stocks are near 32 mt vs 36 last year. Exports stocks are only 4 pct of total World domestic use.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

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.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started