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Morning Outlook



Overnight Highlights

·         Grains open at 8:30am, Livestock at 8:00am.

·         Dollar up strong this morning, up .503 at 91.150 while crude is lower.

·         Weekly exports out today. Expectations include; Corn 600k-800k mt, Soybean 500k-750k mt, Wheat 200k-450k mt.

·         The EIA reported weekly ethanol production at 972,000 barrels per day off 20,000 barrels per day from last week. Ethanol stocks came in at 18.0 million barrels up 479,000 barrels from last week.

·         Mainland Chinese poultry farm in Guandong province that had been traced back as a source of H7N9 bird flu source, as of Friday culled over 13,000 birds.

Commodity Weather Group Forecast

In the U.S., rains spread across the southern 2/3 of the Delta yesterday (.50 to 2.5”). Rains resurge in the Delta tomorrow and expand across the eastern Midwest/Southeast through Sunday. Main wetness concerns focus on LA/MS, but the area will get at least 5 days of drying before more showers cross the area later in the 6 to 10 day. Another surge of cold into the Plains this weekend could lead to limited winterkill, but most focuses on snow-protected areas this time. The greater concern for winterkill is now focused on the Midwest at the middle of next week, when lows of -5 to -10 F could expand across the northern 2/3 of the belt. Snow cover capable of providing protection is limited to the northern 1/4 of the region, leaving nearly 1/2 of the belt at risk. Ice in OK today is unlikely to be heavy or extensive enough to cause much damage.

In South America, more showers lingered in the past 2 days for Argentina than expected, scattering across much of central/northern Cordoba, Santa Fe, Entre Rios, and eastern/far northern Buenos Aires. A few showers will occur late Tuesday in northeast areas, with a slightly broader chance again favoring the northeast later in the 6 to 10 day. Recent rains have been extensive for corn/soy, and the driest areas will likely be limited to less than the southwest 1/4 of the belt in the next 2 weeks. Heat remains limited but may expand in these far southwest areas (La Pampa and nearby areas) in the 11 to 15 day. Brazil rains favored western Santa Catarina and northwest Rio Grande do Sul in the past 2 days. The south will see a break through early next week to limit excess rain concerns. The most limited rain will continue to be in the north, but scattered 6 to 15 day activity is still likely to be adequate in all but 15 to 20% of the belt (mainly far northeast areas).

Morning Market Snapshot

Grains will open at 8:30 am and Livestock at 8:00 am this morning.


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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