Written Commentary
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June 1, 2023
MORNING AG OUTLOOK
TGIT. Grains are mixed. SK is down 6 cents and near 15.04. SMK is near 450.2. BOK is near 54.86. CK is down 2 cents and near 6.50. WK is unch and near 6.82. KWK is up 6 cents and near 8.67. MWK is up 7 cents and near 8.81. US stocks are lower. US Dollar is higher. Crude is lower. Silver, copper, cocoa and cotton are higher. Coffee and sugar are lower.
Soybeans are lower. Weekly export sales are estimated near 200-600 mt vs 348 last week. Flash sale of 276 mt to unknown could be more China switching from Argentina to US. WTO est world export trade to slow to +1.7 pct vs +2.7 in 2022 and 2.6 average. Slowdown linked to ongoing Ukraine war and global inflation. Global economic growth is est at 2.4 pct vs 3.0 in 2022 and 5.9 in 2021. Brazil soybean export prices continues to drop now 70 cents fob cheaper than US. Argentina farmer has sold 5.5 mmt soybean to date vs 12.0 ly. Some feel new soya peso deal could trigger 8.0-10.0 mmt new sales. Trade est Brazil soybean crop near 153.6 mmt vs some est closer to 155. Argentina crop is est at 29.3 vs USDA 33.0 in April and some closer to 25.0.
Corn futures are lower. Next 10 days US Midwest forecast continues to offer resistance to futures. US weekly ethanol stocks dropped as US gas consumption is on the rise. Some feel final US corn acres could drop from USDA latest est especially in north and SE. Weekly export sales are est near 800-1,500 mt vs 1,036 lw. There has been no new sales announce to China. Some feel their buying may be done for now. Matif corn continues to slide lower due to increase in Ukraine imports. US domestic basis remains strong on commercial need and slowdown in farmer selling. All eyes now on the weather.
Wheat futures are mixed. Wheat futures rallied in part on Wednesday after GFS weather model reduced rains in HRW areas. HRS was also up as snow meltdown starts and could slow plantings. Funds are still short Chicago futures which adds to market price uncertainty. Matif futures are lowest since Sep, 2021. Turkey Foreign Minister said Ukraine war could intensify this summer which adds uncertainty to Ukraine export and 2023 crops. EU wheat exports are up 6 pct yoy vs USDA est of up 16 pct. USDA est Russia wheat exports at 43.5 mmt vs 33.0 ly.
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