Written Commentary
MORNING OUTLOOK
Grains are higher. SK is up 9 cents and near 14.81. SX is up 5 cents and near 13.05. Both new highs. 15.35 and 13.25 next objectives. SMK is near 409.3. BOK is near 59.53. Next objective 2011 high near 60.41 then 2008 high 71.26. CK is up 7 cents and near 6.13. 2013 high 6.26 next objective. CZ is up 3 cents and near 5.32 and new highs. 5.50 next objective. WK is up 8 cents and near 6.67. 6.83 then 6.93 next objective. KWK is up 6 cents and near 6.26. 2021 high 6.60 next objective. MWK is up 6 cents and near 6.76. 7.00 next objective. Higher trade linked to exploding higher US domestic soybean and corn basis and concern about dry Brazil weather and less than ideal starts to US, EU and Black Sea 2021 crops weather.
US stocks are marginally lower and near key support. US Dollar and Crude near key support. Gold is inching higher.
Chinese Ag futures (September) settled up 47 yuan in soybeans, up 19 in Corn, up 17 in Soymeal, up 240 in Soyoil, and up 314 in Palm Oil. Malaysian palm oil prices were up 90 ringgit at 3,895 (basis July) at midsession on tightened supplies.
US 6-10 day calls for above normal temps and dry SW, normal Midwest rains. 8-14 normal temps/rains.
Increase global cases of virus increasing concern about economic rebound and energy demand.
There is talk China published new feed ration guidance that suggested lower corn and soymeal use.
Asian soymeal and vegoil futures higher. Talk of China buying Brazil soybeans.
US domestic soyoil basis sharply higher. Brazil soybeans to US do not work but Brazil soyoil to US close. US cash corn basis strong. Ethanol margins improving. USDA to low on export guess. Brazil dry.
US April Cattle on feed up 6 pct. Placements up 33 pct. June cattle down from 125 high. Dec up to 127. Hogs have been under pressure on concern over lower China demand. June hogs spiked to 106.
US wheat futures higher on US weather concerns. Canada, EU and Back Sea crops off to slow start. Market watching closely colder than normal US winter wheat temps and impact on crops.
Canada 2021 initial acreage estimate showed shift from wheat to canola.
Matif wheat futures new 6 week high. Russia farmer not selling. LY, harvest low $180 vs fall high $300.
Next US key data is weekly ethanol and export sales reports. USDA May 12 21/22 US S/D now key
On Tuesday, Managed funds were net buyers of 6,000 SRW Wheat; 35,000 contracts of Corn; 12,000 Soybeans; 3,000 soymeal and; 7,000 Soyoil. We estimate Managed Money net long 7,000 contracts of SRW Wheat; net long 461,000 Corn; net long 184,000 Soybeans; long 55,000 Soymeal, and; net long 103,000 Soyoil.
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