Written Commentary
MORNING OUTLOOK
Grains are higher. SU is up 5 cents and near 13.15. SX is up 3 cents and near 13.05. SMU is near 363.9. BOU is near 59.44. CU is up 2 cents and near 5.55. CZ is up 2 cents and near 5.41. WU is up 9 cents and near 6.64. KWU is up 11 cents and near 6.17. MWU is up 15 cents and near 7.98.
US stocks are higher. US Dollar is mixed. Crude is higher. Gold is higher. Fed Chairman said inflation is a passing phenomenon. Labor market slower than he hoped. US home prices record high.
Algorithm machines focused on this week’s rains in east including IA. NW and N plains hot/dry next week.
Many position trades are unwilling to take new positions into USDSA report. Funds long soya short corn. Large premium CN over CU and SN over SU do to slow farmer selling and tightening supplies. Commercial exporter appears to be large new short. Corn and soybean crushers covered into Aug. Based on USDA data, 41 pct of US Midwest soils are in drought. Record corn yield in doubt.
Rumors continue that China bought a few US PNW soybean cargoes and a few Brazil Aug-Sep. China Dalian corn, soybean, soyoil, palmoil prices were higher. Hog margins lowest in 7 years.
Most est US June 1 soybean stocks near 763 mil bu vs 1,381 ly. Mar-May exports 181 vs 246 ly. Same group could see US soybean acres near 88.5 vs USDA 87.6 and 83.1 ly. Cotton 11.8 vs 12.1.
Most est US June 1 corn stocks near 4,014 mil bu vs 5,003 ly. Mar-May exports 1,053 vs 606 ly. Same group could see US corn acres near 93.6 vs USDA 91.1 and 90.8 ly. Sorghum 7.1 vs 5.9 ly.
Most est US June 1 wheat stocks near 841 mil bu vs 1,028 ly. Mar-May exports 263 vs 246 ly. Same group could see US all wheat acres near 46.2 vs USDA 46.4 and 44.3 LY. Rice 2.7 vs 3.0.
Baltic and Russia new crop wheat export prices remain a discount to US.
SU resistance near 13.30, CU 5.80 and WU in a 6.40-6.80 range.
On Tuesday, Managed funds were net sellers of 5,000 SRW Wheat; 15,000corn; 12,000 soybeans; 5,000 soymeal and bought 2,000 soyoil. We estimate Managed funds to be net short 13,000 SRW wheat; long 242,000 corn, 105,000 soybeans, long 17,000 soymeal and long 72,000 soyoil.
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