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Closing Comments


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Closing Comments

Crude oil was lower as OPEC production is at record levels and oil producers work to lock in hedge profits after crude has rallied 20% off its lows.

The US dollar index started the new month continuing its lower trend and finally taking out the low of this prolonged consolidation that was established in the fall of 2015. The commodity market will be watching the dollar behavior after breaching the low.

Soybeans gained on corn today led by continued “buy meal / sell soy oil”. Corn gained on wheat as the market continues to expect higher output from the EU and US winter wheat supplies.

Corn managed to recover early losses on spillover strength from soybeans. Export inspections came in above 40 mln bushels for the fifth week in a row at 45.6 mln bushels. Corn basis in the Midwest is steady to weaker as farmers continue to move ownership to commercials. Technically corn was able to recover from early session losses but bear spreading was in play as December led strength in price. USDA planting progress for corn for May 1 was 45%, up from last week at 30% and the average for this week of 30%. States below their five year average include MI, NE, SD and TX.

Soybeans find a new high close on this run, challenging toward Thursday’s swing highs as new highs from technical buying in soy meal spilled into further buying in soybeans. Soybean inspections were nearly half of last week’s pace at only 5.5 mln bushels. USDA noted US processors crushed 4.99 mln tons of soybeans during March, just above the analyst expectations of 4.966. Soy meal end of month stocks came in at 302,672 tons, down from 330,057 in February. Down in Argentina, their state weather agency is estimating a loss of 9 mln tonnes due to recent wet weather which would amount to 15 to 16 percent of the expected crop production.

Winter Wheat lower on the day while spring wheat closes on its high up 3 cents in September. Wheat inspections came in 18% below last week at 13 mln bushels. The European Commission raised its estimate for soft wheat stocks 1 mln tonnes in the EU at the end of the 16/17 season – primarily due to a 600k increase for this season’s carryover. US winter wheat G/E conditions jumped to 61% from last week’s 59%. Spring wheat planting progress came in at 54% vs 39% for the five year average.

Cattle and feeder cattle higher right out of the gate after weeks of selling pressure but lower boxed beef values lower on the day brought the beef complex off their session highs. Choice traded $1.68 lower to $209.77 per cwt while Select was off $2.31 to $199.96.

Hogs continue higher, following through on their head-and-shoulders technical rally. Compared to the prior day, on a plant by plant basis, weighted average base prices were 0.98 lower to 2.00 higher with the market trend not yet well established. Slow market activity with light demand.

Closing Market Snapshot



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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