Written Commentary
ADM Appoints Monish Patolawala as EVP and CFO
July 10, 2024
MORNING OUTLOOK
TGIF. Grains are higher. SK is up 7 cents and near 13.73. SMK is near 428.9. BOK is near 45.44. CK is up 3 cents and near 5.43. WK is up 2 cents and near 6.41. KWK is up 4 cents and near 6.21. US stocks are lower. US Dollar higher. Crude is lower. Key to financial, energy and currency markets will be pace of economic recovery and vaccine pace versus new virus strain. US Fed remains accommodating. US debt on the rise.
For the week, SRW Wheat prices are down roughly 4 cents; HRW down 9; HRS down 6; Corn is down 5 cents; Soybeans up 11 cents; Soymeal unchanged, and; Soyoil up 110 points. Crushing margins up $0.01 $0.67 (July); Oil share up 1% at 34%.. Key now is money flow, South America crop yields and export pace and China demand. Grain trade also has to come to terms with lower privates estimate of US corn and soybean carryout vs USDA.
Chinese Ag futures on holiday from Feb. 11 to 17 (Thursday to Wednesday) for the celebration of Chinese Spring Festival. Resumes on Feb. 18 (Thursday). Malaysian palm oil prices were closed for holiday. Next week, Brazil and US will also be on holiday. Could see quieter but choppy grain trade.
Conditions will continue to be favorable in most of Brazil the next two weeks. Net drying will occur through next Thursday from La Pampa into Corrientes and eastern Formosa of Argentina. Last evening’s GFS model run also continued to show greater rainfall for Argentina in the second week of the outlook compared to the first.
US Corn export commit is up 142%, shipments up 82% vs USDA est up 34% . Weekly nearby corn futures range was 5.24-5.74. USDA report was negative. Cash fundamentals positive. US export commit 65 pct of USDA goal. MG Brazil corn crop only 10 pct planted vs 40 ly. Argentina crop rated 23 pct G/E vs 62 last year. Only 60 pct crop pollinated. Argentina weather forecast is dry.
US Soybean export commit up 81%, shipments up 82% vs USDA est up 34%. Weekly nearby soybean price range 13.37-14.09. Cash fundamentals positive. US soybean export commit is 87 pct of USDA goal. Brazil soybean crop late. 13.5 mmt of soybean vessels waiting to load. Argentina crop rated 23 pct G/E vs 66 last year.
U.S All Wheat export commit are up 5%, shipments down 1% vs USDA est up 2% . Key to prices will be Russia export policy, EU export pace and north hemisphere weather. Russia farmer has stopped cash sales.
On Thirsty Thursday, Managed funds were net sellers of 1,000 SRW Wheat; bought 22,000 Corn; net 11,000 Soybeans and 5,000 lots of Soymeal, and; net sold 1,000 Soyoil. We estimate Managed Money net long 7,000 contracts of SRW Wheat; long 339,000 Corn; net long 177,000 Soybeans; net long 70,000 lots of Soymeal, and; long 119,000 Soyoil.
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