Written Commentary
MORNING OUTLOOK
Grains are higher. US stocks are higher. SN is up 3 cents and near 15.89. SX is near 14.46. SMN is near 405.5. BON is near 79.64. CN is up 1 cent and near 7.72. CZ is near 7.10. WN is up 3 cents and near 10.96. KWN is up 6 cents and near 11.68. MWN is up 5 cents and near 12.12.
Crude is lower on talk of lower Saudi Arabia prices and China lockdowns. US Dollar is higher. Gold, silver, copper and cotton are higher. Coffee, cocoa, and sugar are lower.
Jefferies forecasted higher commodity prices due to lower supplies. Warned that China Covid lockdown, slower US economy and EU recession could slow rebound. China Yuan near 18 month low.
US dry weather should help corn and soybean plantings. Rains could slow US HRS plantings. Ongoing dryness could lower US HRW crop outlook. EU, Brazil and Argentina are dry. India, Pakistan, Bangladesh, N Africa and Middle east are also dry.
Recent soybean price selloff linked to demand concerns. China April soybean imports 8 mmt. Season to date exports 51 mmt or down 6 pct vs ly. Annual pace close to 93 mmt vs USDA 96. US soybean exports 1,753 mil bu or down 20 pct ly. US soybean plantings 12 pct vs 39 ly and 24 average. IL 11 vs 55 ly, IA 7 vs 64, MN 2 vs 59. 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.
Recent corn price selloff linked to demand concerns and better US planting weather. US corn exports 1,496 mil bu or down 16 pct ly. US corn plantings 22 pct vs 64 ly and 50 average. IL 15 vs 71 ly, IA 14 vs 84, MN 9 vs 81. 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. Trade will see how USDA handles Ukraine 2022/23 corn exports.
Wheat prices are rebounding led by MLS spring wheat. USDA rated the US HRW crop 29 pct G/E vs 27 last week after last week’s rains and vs 49 last year. Dry and warm forecast could eventually drop ratings. US spring wheat plantings were 27 pct vs 47 ly. ND 8. EU, India, Pakistan, Bangladesh, Argentina, N Africa, Middle east are all dry. Will see how USDA handles potential drop in Black Sea wheat exports due to Ukraine war.
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.
