Written Commentary
MORNING OUTLOOK
USDA report day. Quiet before the storm? Grains are mixed. SH is up 9 cents and near 15.78. SX is up 11 cents and near 14.24. SMH is near 455.5. BOH is near 63.33. CH is up 4 cents and near 6.37. CZ is unch and near 5.82. WH is down 5 cents and near 7.73. KWH is down 4 cents and near 7.97. MWH is down 6 cents and near 9.34.
US stocks are higher. US Dollar is lower. Crude is lower. Gold, silver, coffee, cocoa and sugar are higher. Copper and cotton are lower.
Dalian soybeans were lower. Soymeal higher. Dalian palmoil and soyoil prices were lower. Soyoil is down on talk China may sell soyoil from reserves. Trade is looking for USDA today to drop SA soybean crop 10 mmt from Jan. China are buyers of US soybeans. US 2021 trade deficit with China was second largest at $355 billion. China bought only 83 pct of Phase 1 trade deal or equivalent of 850 mil bu of soybeans. Key today is will USDA drop US 2021/22 soybean carryout enough to satisfy the bulls.
March corn futures are higher. Dec is unchanged. Most doubt USDA will drop SA corn crop, raise US demand and lower the carryout enough to feed the bulls. Today’s US ethanol stocks could be 4th largest since 2010. US census Sep-Dec corn exports were 131 mil bu. Equal to last year, higher than inspections and vs USDA estimating a drop of 12 pct.
Wheat futures are lower. Lower than expected Canada Dec 31 wheat stocks helped wheat futures and Matif wheat turnaround higher on Tuesday. Appears threat of Russia invading Ukraine may be in decline but US south plains and N Africa are dry. May be a good 30 days away from trading the dryness. USDA could lower US wheat exports today and raise carryout. Key though could be World numbers. USDA should drop total World supplies, raise demand and lower World wheat stocks. But will they?
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