Written Commentary
The Ghost in the Machine Q1 2024
March 19, 2024
MORNING OUTLOOK
Grains are limping sideways to higher into the US holiday weekend. CBOT grains closed Monday. SN is up 2 cents and near 17.29. SX is near 15.41. SMN is near 427.8. BON is near 80.27. CN is up 1 cent and near 7.66. 50 DMA is near 7.70. CZ is near 7.21. WN is up 8 cents and near 11.51. KWN is up 2 cents and near 12.31. MWN is up 7 cents and near 12.99.
US stocks are higher. US Dollar is lower. Crude is higher. Gold, silver, copper, sugar and cotton are higher. US north Plains, Great Lake states and Canada will see more rains this week. US south plains forecast is drier. EU is dry. NE China is dry.
Wheat and corn are slightly higher and off Thursdays lows. Some estimate that there are 70 vessels in Ukraine that either need export or need to be loaded. Talk that a large hedge fund liquidated a large long 2 corn short 1 soybean potion may have been main reason for lower corn trade Thursday. At one point they were liquidating 2,000 contract every few minutes. Increase in US corn planting may have triggered the corn spread liquidation. Some estimate Brazil corn crop near 108 mmt vs USDA 116. Some feel USDA could be 8-12 mmt too high in SA corn supply.
Some estimate they there is 2-3 mmt of US CRP acres expiring in 2022 in which could see increase in 2023 wheat, corn and soybean acres.
US cash soybean crush margins remain positive. US August soybean demand could be record. Brazil soybean fob basis higher. Talk Argentina could increase export tax. Argentina rated their soybean crop 16 pct G/E vs 50 ly, crop 49 mmt vs USDA 53. China announced they would sell 500 mt soybean from reserves on June 1. Talk that a large hedge fund liquidated a large long 2 corn short 1 soybean potion may have been main reason for sharply higher soybean trade Thursday.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2024 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
