Written Commentary
MORNING OUTLOOK
Grains are mixed. SK is down 4 cents and near 14.15. SMK is near 407.3. BOK is near 54.71. CK is up 2 cents and near 5.52. WK is down 4 cents and near 6.40. KWK is down 5 cents and near 6.01. US stocks are lower. US Dollar is higher. Crude is lower. Biden Administration is taking about higher taxes. Talk of vaccine helping US economy versus inflation and higher interest rates.
Chinese Ag futures (May) settled down 81 yuan in soybeans, up 13 in Corn, up 25 in Soymeal, up 74 in Soyoil, and up 2 in Palm Oil. Malaysian palm oil prices were up 18 ringgit at 4,038 (basis June) at midsession, longest winning streak in 19 years on improving exports.
In Argentina, occasional periods of shower and thunderstorm activity in the next seven to ten days are still expected to help reduce crop stress and stop the decline in crop conditions. In Brazil, rain in the next two weeks is still expected to benefit late season summer crops but lead to some additional fieldwork delays, especially with soybean harvesting and corn planting.
Nearby corn futures rallied on strong domestic US basis and better than expected weekly US export inspections. N/C Brazil weather looks drier and could help plantings. Crop is still late. Soymeal rallied on lower US Feb crush. China crush margins are down, weekly crush dropped to 1.4 mmt and there is more concern about ASF. Brazil harvest should increase with wide spread estimates of production. Soybean futures range bound until USDA March 31 report. Soyoil dropped on lower palmoil prices and some liquidation of long soyoil and short soymeal spreads. USDA raised KS wheat ratings 2 pct to 38 G/E, OK +4 to 57 and CO +6 to 25. Russia 2021 crop conditions down from normal. EU conditions also down due to cold temps.
Another weather disturbance with significant precipitation is still expected late Tuesday through Thursday with the central and portions of southern Hard Red Winter Wheat Region, central and southern Corn Belt and Delta and southeastern states involved.
On Monday, Managed funds were net buyers of 4,000 contracts of SRW Wheat; bought 17,000 Corn; net bought 3,000 Soybeans; bought 4,000 lots of Soymeal, and; net sold 2,000 Soyoil. We estimate Managed Money net long 19,000 contracts of SRW Wheat; long 368,000 Corn; net long 153,000 Soybeans; net long 56,000 lots of Soymeal, and; long 107,000 Soyoil.
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