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Morning Outlook


Overnight Highlights

* Overnight markets have corn -2 1/2, soybeans -4 1/2, wheat -1-2, crude oil -.28, dollar +.28, gold -17.0 and the Dow +8.
* Grains lower overnight on profit taking and farmer selling.
* Chinese Dalian exchange futures lower with concern the government will begin offering corn supplies out of reserves April 1st.
* Talk that China has cancelled a couple Brazilian cargoes of soybeans on the rally in CBOT soybean futures.
* Yesterday funds were reportedly buyers of 10,000 soybeans, 3,000 corn and 1,000 wheat.
* Cold Storage report yesterday came in with smaller beef and pork supplies in the freezer than trade expectations.

Commodity Weather Group Forecast


In the U.S., rain/snow has favored central/western SD, northern CO, and the NE Panhandle in the past day, and this system will head eastward through the upper Midwest during the next two days (including significant snow of 4 to locally 12″ from western NE to the MN/IA border and central WI). Rain showers will also scatter through the eastern Midwest/TN Valley tomorrow, with another system heading from the C. Plains into the southern/eastern Midwest this weekend and again late next
week. The 11 to 15 day has also shifted somewhat wetter in the central/southeast Plains versus yesterday. While the best chances for Plains moisture will focus on CO, southwest NE, northern/eastern KS, central/eastern OK, and eastern TX, the event this weekend is a bit farther south and could benefit dry spots near the KS/OK border. This may narrow the driest areas to the southwest 1/3 or less of the Plains hard red wheat. Frequent cool shots during the next two weeks in the Midwest/Plains will be a discouraging factor for fieldwork and slow wheat growth but do not currently appear strong enough to threaten outright losses to wheat. Rains and planting interruptions in the Delta will favor LA/MS/central TN in the next ten days, with the best chance for broader interruptions to early seeding progress in the region primarily in the 11 to 15 day.

In South America, rain (.25 to 1″, locally 2″) favored southern Mato Grosso/eastern Mato Grosso do Sul/Goias/Sao Paulo/eastern Parana yesterday. The next rain spreads across safrinha corn areas tomorrow through the weekend, easing spotty moisture shortages. The rains will hamper soy/first-crop corn harvest in the south 1/3 of the belt, but damage will be isolated. Robusta coffee remains stressed, as rains fail to reach the area in the next 10 days. Argentina remains mostly dry over the next 10 days, ensuring that the corn harvest pace returns to normal and early soy harvest gets off to a good start.

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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