Grains Are Mixed This AM

by Steve Freed

Grains are mixed. SN is up 1 cent and near 8.40. CN is unchanged and near 3.17. WN is down 4 cents and near 5.16. KWN is down 5 cents and near 4.78. Stocks are higher. Crude is higher. US Dollar is higher.

Freezes will occur in portions of the Corn Belt Friday through May 13 before conditions notably warm up. MN, WI, MI, OH, NE IN, N IL, and NE IA will likely be coldest in general; though, harder freezes will occur in WI and N MI in the morning Saturday and possibly next Tuesday

Pockets of light freezes in northern hard red winter wheat areas, such as NE and NE CO, will burn back vegetative growth but is unlikely to cause permanent damage

Wheat futures are lower. Talk of higher 2020/21 wheat supplies offers resistance. Some now are talking World 2020 wheat production may be near a record 776.0 mmt and stocks also a record 315 mmt. There continue to be a steep discount from old crop Russia prices to new. This offer resistance to futures. Satellite images show crop deterioration in S Russia. Today weather forecast suggest lighter rains for S Russia that earlier estimate.

Corn futures may be in a range after USDA estimated US corn plantings ahead of what was expected and average. Trade will now be positioning in front of the USDA May 12 report. Today’s ethanol report, Thursday US export sales, rapid US corn planting pace and May 12 USDA report could all offer resistance to prices. US cash basis slipped on talk of increase US farmer selling.

Soybean prices may be on the defensive until China begins to buy more US soybeans or there is a weather concern. Trade will be watching USDA May 12 report and see if they drop 2019/20 demand and what they forecast for US and World 2020/21 supply and demand.

On Tuesday, Managed funds were net buyers of 2,000 contracts of SRW Wheat; net bought 1,000 Corn; net even Soybeans; net even Soymeal, and; even Soyoil. We estimate Managed Money net long 14,000 contracts of SRW Wheat; net short 152,000 Corn; net long 8,000 in Soybeans; net short 7,000 lots of Soymeal, and; net short 8,000 Soyoil.  

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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.