Written Commentary
The Ghost in the Machine Q1 2024
March 19, 2024
MORNING AG OUTLOOK
Grains are higher. SN is up 6 cents and near 13.56. SMN is near 403.1. BON is near 49.57. CN is up 8 cents and near 6.06. WN is up 17 cents and near 6.41. KWN is up 16 cents and near 8.38. MWN is up 13 cents and near 8.33. US stocks are mixed. US Dollar is mixed. Crude is lower. GSI commodity index continues to drift lower. Some point to slow China and US manufacturing for the drop and lower commodity demand.
Soybean futures are higher. US Midwest is mostly dry for 7 days. N EU, Russia. Ukraine are dry. US ND and Canada is dry. USDA surprised the market by rating US 2023 soybean crop at 62 pct G/E vs 70 ly and at 4 year low. Supply bulls point to fact 28 pct of US soybean acres are in drought vs 16 pct this date in 2012. One crop scout left his US 2023 soybean yield unch at 52. Trade estimates US 2022/23 soybean carryout at 223 and 2023/24 at 345.
CN is higher. US Midwest is mostly dry for 7 days. EU, Russia. Ukraine are dry. Canada is hot.. USDA surprised the market by rating US 2023 corn crop at 64 pct G/E down 5 from last week and 70 ly. IL was down 19 pct, MI -20, OH -17. Supply bulls point to fact 34 pct of US corn acres are in drought vs 13 pct this date in 2012. One crop scout dropped his US 2023 corn yield 1 bpa to 179. Trade estimates US 2022/23 corn carryout at 1,449 and 2023/24 at 2,254.
Wheat futures are higher. Ukraine war is back in focus after Russia destroyed a Ukraine dam. NE EU, Russia spring wheat and Ukraine are dry. US ND and Canada are dry. USDA estimates World wheat crop at 789 mmt vs 788 ly. Some feel crop could drop 12 mmt to 777. Continued adverse global weather could drop crop another 20 mmt. Trade estimates US 2022/23 wheat carryout at 606 and 2023/24 at 569. Trade also estimates US 2023 wheat crop at 1,672 up 13, winter 1,143 up 13, HRW 520 up 6, SRW 414 up 8 and white winter unch at 210.
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