Written Commentary
MORNING OUTLOOK
Grains are mixed. SK is up 6 cents and near 14.29. SMK is near 401.7. BOK is near 56.83. CK is up 1 cent and near 5.52. WK is up 3 cents and near 6.368 KWK is down 1 cent and near 5.80.
US stocks are lower. US dollar is higher and near 4 month highs. Crude is higher. Suez canal blockage for now is supportive versus concern about demand due to EU virus lockdown. US Fed Chairman remarks dismissing inflation concerns may be easing rates. Key to US is post vaccinated food and fuel demand and rebound in employment. Higher US debt could eventually weigh on US Dollar.
Chinese Ag futures (May) settled up 90 yuan in soybeans, unchanged in Corn, up 37 in Soymeal, down in Soyoil, and down 12 in Palm Oil. Malaysian palm oil prices were down 44 ringgit at 3,886 (basis June) midsession on position-evening.
Argentina’s environment will still be favorable in most areas for late season crop development and most of the nation will receive meaningful rain Wednesday through Saturday. Net drying in much of Brazil, excluding the far south and northwest Mato Grosso, will still benefit fieldwork advancement but also raise concern of crop moisture stress. Shower and thunderstorm activity could return to the drier areas of Brazil in early April.
Last evening’s GFS model run was similar to the midday GFS model run of showing a surge of way below average temperatures to move down into the central and southern U.S. Apr. 3 – 6.
Soyoil future are seeing some selling following lower palmoil trade. Seasonally, palmoil production tend to increase now. Higher prices may also be slowing palmoil demand. Matif rapeseed oil is higher.
Soybean futures supported by higher US crush margins and talk of tighter US 2020/21 supply.
Soybean futures near upper end of range, waiting for bullish USDA report. OI is down from Feb high
Corn futures also near resistance. US cash market firm. OI down from Feb high. Midwest rains helps crop
2020/21 corn supplies also declining. USDA estimate of March 1 stocks and 2021 acres key to prices.
Matif wheat steady. EU market has gone from where is the supply to wheat is the demand
US south plains rains helps crops there and weighs on KC futures. US north plains is dry. Helps MLS
Higher US dollar and lack of new US export demand offers resistance. Lack of Russia exports supports
Wheat futures could be near support for summer end user needs. OI also down from Feb highs.
On Tuesday, Managed funds were net buyers of 5,000 SRW Wheat; 3,000 Corn; 4,000 soybeans, 1,000 soymeal and 2,000 lots of soyoil. We estimate Managed Money net long 10,000 contracts of SRW Wheat; long 349,000 Corn; net long 155,000 Soybeans; net long 55,000 lots of Soymeal, and; long 98,000 Soyoil.
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