Home Market Market Watch Morning Outlook

Morning Outlook

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Overnight Highlights

  • Overnight markets have corn mixed, soybeans +2-3, wheat +1, crude oil +.11, dollar +.15, gold -18.0 and the Dow +35.
  • Generally higher grains overnight on money flow into the commodities markets, South American weather and uncertainty over summer US weather. Both USDA and Brazil will release monthly crop reports tomorrow.
  • Trade expects corn planting progress to be 65-70% complete on corn vs 61% average for the date. Soybean progress expected at 25-30% vs 21% average for the date.
  • China’s Customs Administration reported April soybean imports at a new record for the month at 7.07 mln mt.
  • Friday’s Commitment of Traders report for Managed Money had corn net long 71,032 (off -8,749), soybean long 167,554 (up 7,429) and wheat net short -62,241 (up -1,436).
  • Friday funds bought 11,000 soybean, 5,500 corn and 1,000 wheat.
  • Analysts expect Tuesday’s 16/17 corn ending stocks to be a bearish reminder to the market with a 2.30 bln bu estimate vs the 15/16 April estimate a year ago at 1.86 bln.

Commodity Weather Group Forecast

 

 

In the U.S., scattered weekend showers favored parts of NE, south-central SD, north-central/east-central KS, central TX, northern MO, western IA, central IL, and southwest Saskatchewan, primarily in the past 24 hours. Highs rose into the low 90s in parts of the northwest Midwest on Friday. Cooler 6 to 10 day conditions should only bring light frost to the northern edge of the Midwest and will pose little concern. Rains will scatter across the western Midwest through Wednesday and again on

Friday, with activity through Thursday and again on Saturday in the east. This will stall corn/soy seeding this week (mostly 1 to 2” amounts), but the bulk of the 6 to 10 day rain slides south of the Midwest to offer a brief window of opportunity prior to similar 11 to 15 day rain delays. While rains will not be constant in the Delta, breaks will be short-lived and planting progress more limited, as 6 to 10 day rains also favor the region. ND/MI/AL/GA are likely to see the most limited rain in the next two

weeks. Moisture will remain favorable for Plains winter wheat yields. Spring wheat seeding will be slowed by showers through mid-week and again in the 11 to 15 day, particularly in MT and the eastern 1/2 of the Canadian Prairies. The showers will ease moisture deficits in the Prairies, but the western 1/3 of the belt is not favored and will also most often be warmer.

 

In South America, Argentina showers (.25 to .75”) were confined to the southwest 1/4 of the corn/soy belt over the weekend. Showers this week are limited to northern/ western fringes of the belt and then scatter across the south late in the weekend. Overall, harvest delays should be minor, with little rain in the 11 to 15 day either. Brazil rains (.50 to 2”, locally 4”) fell in the southern 1/3 of the corn belt. Similar showers continue into Thursday before drying into the weekend, with lighter showers again in the south early next week. Flood threats are isolated. The northeast 1/3 of corn remains under stress.

 

All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.

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