Potential For Record 2025 Global Supply Offers Resistance

MORNING AG OUTLOOK

Grains are mixed to higher. US stocks are higher. US Dollar is lower. Crude is lower. Gold is slightly higher. US Fed is expected to lower rates 25 basis points Wednesday but could pause in 2025 if inflation rates remain elevated. China November retail sales were slower.

 

SOYBEANS

SH is near 9.98. Dalian soybean, soyoil and palmoil futures were lower. Palmoil was lower due to lower exports. Rains are forecast for most of Brazil and Argentina. Front loaded US soybean export commit and near record crush offers support. Some est US crush 50 mil bu higher than USDA but exports down 45.In inflation terms, SMH is near 25 year lows. Funds have a near record short futures position. US NovNOPA soybean crush is est at 196.7 mil bu vs 189.0 ly. Overnight, BOH is below 100 DMA support. Matif rapeseed futures are higher on river logistic problems. Fund soyoil long position was larger than expected.

 

CORN

CH is near 4.43. Dalian corn futures were lower. Front loaded US corn export commit and strong ethanol production offers support. Key is how fast US shipments will be vs large open sales. Some est US domestic and export demand 110 mil bu higher than USDA. US farmer increased cash sales at 4.50 CH. China est corn crop at 294.9 mmt vs USDA 292. Increase in Brazil ethanol use and drop in EU quality also offers support to corn prices. Potential for record 2025 global supply offers strong resistance. Fund position was larger than expected.

 

WHEAT

WH is near 5.53. KWH is near 5.59. MWH is near 6.00. A strong US Dollar, Russia suspending sales to Syria, and S Hemisphere arrivals supports the record fund short. But 2025 exports from the EU/Russia could be 15 mmt below last year, and Indian domestic prices hit new highs. Reports over the weekend are that the Egyptian parliament approved a 500 mil US Dollar loan given to GASC from Abu Dhabi Exports to be used in wheat procurements over 5 years. The loan given to GASC is exclusive for wheat imports from a sole UAE entity.

 

 

 

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