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Midday Update

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Midday Update

·         The Argentine crusher strike continues amid talks, but there is a sense that an agreement may be reached this week.

·         However, one of Argentina’s largest unions based  in the key port area of San Lorenzo said it will strike if it does not have a labor agreement by June 1.

·         A national strike in Argentina is expected the second week of June.

·         Soyoil is finding support from trade beliefs that the EPA will increase the biodiesel mandate.

·         The dollar has been more than 1,300 points higher this morning, putting pressure on the broader commodity complex, and more specifically pressuring wheat prices.

·         Export shipments for the week ending May 21 totaled 39.6 million bushels of corn, 4.4 million bushels of grain sorghum, 10.7 million bushels of soybeans and 15.4 million bushels of wheat.

·         The trade expects this afternoon’s USDA crop progress report to peg the corn crop at 75% Good to Excellent in its first condition ratings of the season.

·         The trade expects USDA to peg corn planting at 93% as of Sunday, up from 85% the previous week and up from the five-year average for the week of 88%. I’m looking for 92% planted.

·         The trade expects soybean planting to be at 61% complete as of this past Sunday, up from 45% the previous week and above the five-year average for the week of 55%, with spring wheat planting essentially complete.

·         Winter wheat condition ratings are expected to be down 1 point due to excessively wet conditions in the Southern Plains to 44% Good/Excellent.

·         Upfront crush margins continue to soar, suggesting that export soymeal/soyoil business is coming our way due to problems in Argentina.

·         Corn futures are down 5 cents on favorable growing conditions, a strong dollar and a collapse in wheat prices.

·         Soybean futures are up 2 cents on upfront demand, but rallies are being sold.

·         Wheat futures are 20 cents lower in Chicago on a strong dollar and a breakdown in the charts this morning, with KC down 18 and MN down 15.

·         Live cattle futures are 10 to 35 cents higher, with traders watching to see how aggressive retailers are restocking their shelves after the Memorial Day holiday.

·         Feeder cattle are 60 to 95 cents higher.

·         Lean hog futures are 25 to 65 cents weaker on slowing product demand. The cash market is again steady to $1 lower.

 

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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Arlan Suderman | Senior Market Analyst
WATER STREET ADVISORY® | www.waterstreet.org
(316) 729-4599 | asuderman@waterstreet.org

Past performance is not indicative of future results. The information contained in this report is intended for informational purposes only and is the opinion of the writer and may change at any time. This information was compiled from sources believed to be reliable but accuracy cannot be and is not guaranteed. There is no warranty, expressed or implied, in regards to this information for any particular purpose. There is SIGNIFICANT RISK involved in trading futures and or options on futures and may not be suitable for all investors. Investors should consider these RISKS and evaluate their suitability based on their financial conditions. No one should ever consider trading futures or options on futures with anything other than RISK CAPITAL. This information is provided freely and is NOT in the capacity of a trading advisor. NO LIABILITY on the part of the author exists for any trading loss you may incur in the use of this information. Information provided is not to be construed as an offer to sell or solicitation to buy any commodity or security named herein.

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