Written Commentary
MORNING OUTLOOK
Grains are higher.SN is up 8 cents and near 16.01. SX is near 14.64. SMN is near 400.7 and 3 month low. BON is near 82.56.BON is a record 51. Pct of board crush. CN is up 5 cents and near 7.80. CZ is near 7.22. WN is up 17 cents and near 11.11. KWN is up 16 cents and near 11.91. MWN is up 12 cents and near 12.25.
US Stocks are higher. Crude is higher to talk of fewer new China Covid cases. US Dollar is lower. Gold, silver, copper, cotton, coffee, cocoa, and sugar are higher.
Dry US weather should help corn and soybean plantings. 8-14 day maps looks wetter. Rains could slow US HRS plantings. Ongoing dryness could lower US HRW crop outlook. EU, Brazil and Argentina are dry. India, Pakistan, Bangladesh and Middle east are also dry. Australia is too wet. Putin commitment to long Ukraine war raises questions about Ukraine grain exports. Russia continue to shell Odessa damaging export facilities.
Soybeans are higher. There is talk of China asking for US old and new crop soybean prices. China domestic soymeal stocks are down and below last year. WHO said China covid lockdown policy was not sustainable. USDA should lower SA soybean crops 5 mmt. Key could be estimate of US 2022/23 soybean exports. Some estimate near 2,750 vs USDA Outlook at 2,150. Soyoil finding support from record high diesel fuel prices. Palmoil slightly higher after Malaysia stocks and production were reported higher with exports lower. Matif rapeseed futures higher on dry EU weather.
Corn futures are higher on Ukraine and Brazil export concerns over US planting weather. Brazil corn crop estimates closer to 105-112 mmt vs USDA 116. Some doubt USDA will drop US corn yield from 181 vs crop watchers 177. USDA has used their outlook corn yield on the May report every year since 2014. Trade will see how USDA handles Ukraine 2022/23 corn exports.
Wheat prices are rebounding led by KC HRW .Dry and warm forecast could eventually drop US final HRW crop. US and Canada spring wheat plantings could be delayed. EU, India, Pakistan, Bangladesh, Argentina, Middle east are all dry. Pakistan, Bangladesh and Iran tendering or wheat. Iraq also will need wheat imports. Will see how USDA handles potential drop in Black Sea wheat exports due to Ukraine war. Major World wheat buyers have little forward coverage. US bakers are also short wheat with light coverage.
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