Month End. Grains Mixed to Lower
Month end. Grains are mixed to lower. SF is down 6 cents and near 11.85. Range is 11.83-11.99. SMF is near 394.9. BOF is near 37.88. CH21 is up 1 cent and near 4.35. WH21 is down 4 cents and near 6.01. Range is 6.01-6.09. KWH21 is down 7 cents and near 5.57. Range is 5.57-5.67. US stocks are lower. US Dollar is lower. Crude is lower. Gold is lower. Copper is higher.
SF sold off after failure to trade again over 12.00. SMF found resistance near 400. BOF found resistance near 38.65. CH found resistance near 4.40. WH found resistance near 6.10. Appears grains need new news about China demand for US soybeans and corn to push through key resistance. Over the weekend there were rains over parts of south Brazil and north Argentina.
For the week, SRW Wheat prices were up roughly 7 cents; HRW up 6; HRS up 9; Corn was up 6 cents; Soybeans up 14 cents; Soymeal up $4.00, and; Soyoil up 10 points. Crushing margins were down 2 cents at $1.02; Oil share is unchanged at 32%.
For the month, SRW Wheat prices are down roughly 4 cents; HRW up 14; HRS down 5; Corn is up 26 cents; Soybeans up $1.30; Soymeal up $24.00, and; Soyoil up 445 points. Crushing margins are down 28 cents at $1.01; Oil share is up 1% at 32%.
Chinese Ag futures (January) settled up 93 yuan in soybeans, up 19 in Corn, up 42 in Soymeal, up 42 in Soyoil, and up 22 in Palm Oil. Malaysian palm oil prices were down 27 ringgit at 3,295 (basis February) by rival oil weakness.
Rain will be confined to S Brazil, N Argentina and Paraguay for the coming week, elsewhere it will remain dry. Temps will remain well above normal, particularly in Argentina. The Black Sea looks dry over next 2 weeks. Thursday, night time lows of -15°C to -20°C into Sunday across much of Russia’s winter wheat regions could be a concern. The US Plains remain dry with temps dropping below normal.
For the week ended November 19th, U.S. All Wheat sales are running 11% ahead of a year ago, shipments down 2% with the USDA forecasting a 1% increase on the year, U.S. Corn sales are running 162% ahead of a year ago, shipments 59% ahead with the USDA forecasting a 49% increase. And U.S. Soybean sales are running 106% ahead of a year ago, shipments up 70% with the USDA forecasting a 31% increase on the year.
Concern about South America and Ukraine weather lowering supplies there and increasing demand for US exports could tighten US corn balance sheet. Most look for a US 2020/21 corn carryout closer to 1,550 than USDA 1,702. US exports could be closer to 2,750 mil bu vs USDA 2,650. Some are now estimating US 2021 corn crop near 15,200 mil bu but a 2021/22 carryout near 1,537. Matif corn futures made new highs. Ukraine corm prices are lower.
Currently the total demand for US soybean exports suggest a 50-100 mil bu increase from USDA November guess. This could bring US 2020/21 carryout closer to 100 than USDA November guess of 190. Some are now estimating US 2021 soybean crop near 4,500 mil bu but a 2021/22 carryout near 135. China domestic soymeal sales are down 50 pct from last year. Crush margins are lower. All this despite increase in hog numbers.
On Friday, Managed funds were net buyers of 7,000 contracts of SRW Wheat; bought 17,000 Corn; bought 7,000 Soybeans; net bought 1,000 lots of Soymeal, and; net bought 4,000 lots of Soyoil. We estimate Managed Money net long 25,000 contracts of SRW Wheat; long 284,000 Corn; net long 231,000 Soybeans; net long 79,000 lots of Soymeal, and; long 115,000 Soyoil.
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.
© 2021 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.