Written Commentary
MORNING OUTLOOK
Interesting day. Grains mostly lower.. US stocks are higher for now. US Dollar is lower. Crude is lower. US Fed will increase rates today. EU called for an emergency meeting on economy. Gold, silver, copper are higher. Coffee, cocoa, sugar and cotton are lower.
SU is up 4 cents and near 15.51. SN is near 16.93. SX is near 15.26. SMU is near 396.6. BOU is near 74.55. CU is down 3 cents and near 7.26. CN is near 7.64. CZ is near 7.18. WN is near 10.47. WU is down 4 cents and near 10.60. KWN is near 11.35. KWU is down 8 cents and near 11.40. MWN is near 11.98. MWU is down 10 cents and near 11.98.
US Midwest will be hot and dry the next 2 weeks. Still a few weather watchers are looking for more of a normal US summer. Some feel US Midwest heat may be helping US crops. Spain, France and Germany are dry. Black Sea, Argentina and Brazil are dry. India monsoon is off to a subpar start. Canada is wet and warm.
Markets are concerned about demand for food and fuel. Nearby US wheat futures are in a carry. This suggest lower demand offsets talk of lower supply. Biden announced a plan that would build temporary silos near west Ukraine border to help increase Ukraine food exports to the west. Matif wheat futures dropped along with US despite dry and warmer weather. World wheat buyer are looking at few export options and near record high prices.
Soybean futures were lower overnight but have rebounded with higher stocks and lower US Dollar. NOPA May crush data today. Nearby board crush margin has dropped to 71 cents. Sep in near 139. Brazil and Argentina soybean export basis continues to drop on slow demand. Malaysian palmoil futures are lower on talk if higher Indonesia palmoil exports. Dalian soybean, soymeal, soyoil and palmoil futures were lower. There is also talk that Biden could lower China import tariffs.
Corn futures are lower on demand concerns. Talk of higher Brazil and Argentina corn use for ethanol demand triggered some commercial buying of US cif. Trade trying to decide if nearby heat and dryness is helping US 2022 corn crop or if the forecast of dry and warm US 2 weeks could begin to stress the crop and add a weather premium to futures. Matif corn futures are steady on dry EU weather. Biden announced a plan that would build temporary silos on west Ukraine border to help increase Ukraine food exports to the west. There is also talk that Ukraine may use storage bags to store the 2022 crop. Reduced Ukraine and South America corn exports should increase demand for US corn. USDA announced Mexico bought US corn on Tuesday. US ethanol production, stocks and margin report today.
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