Ami Heesch

Jul 29, 2020

Ami L Heesch 

 

Highlights

Row crops weaker on retreating temperatures from recent bouts of extreme heat. Wheat found some legs on more reductions to EU and Black Sea Region. The Federal Reserve opted to leave interest rates near zero. 

  • The energy markets are mostly higher with crude oil up 22 cents at 41.27/barrel.
  • The US$ is down 0.360 at 93.33, the gold market is up 11 bucks at 1961/ounce and the CD$ is up 0.00115 at 0.74965.
  • DJIA up 161 at 26540, S&P up 36 at 3260 and NASDAQ up 130 at 10532. 

Corn

Corn prices remain on the defensive as outlook continues to favor a big US corn crop. Temperatures seemed to have settled back this week, which should continue to be beneficial for the crop going forward. 

  • Closes: September at $315 ½, down 4 ½  cents, December at $3.26 ¼, down 3 ¾ cents, March at $3.38 ¼, down 3 cents, July at $3.52 ¼, down 2 cents.
  • CIF premiums are 3-5 cents weaker for August.
  • Weekly export sales estimate: 600 tmt-1.6 mmt.
  • Ethanol production increased 50k barrels per day to 958k barrels per day. Stocks were raised 471k barrels to 20.7 million barrels.
  • Argentina’s corn crop estimated at 47.6 mmt versus 50.0 mmt previously, because of extended periods of hot/dry weather conditions.
  • Spreads: U/Z 10 ¾ carry (snuck out to 11 cents during the session), Z/H 11 ¾ carry (think it’s stuck here), Z/N 25 ¾ carry, Z/Z 35 ½ carry.

Oilseeds

Lower trade on mild weather conditions and big crop ideas. Thoughts are that the crops are looking better all the time now as the temperatures have retreated slightly and there has been pop-up showers about the US Midwest.   

  • Closes: November at $8.86 ¼, down 1 ¼ cents, January at $8.92 ½, down ¾ cent, July at $9.00 ½, up 1 ½ cents. The products were mixed with meal down 1-2 bucks and oil up 36 points.
  • CIF premiums are steady for August.
  • Weekly export sales estimates; 108-205 mmt for beans, 150-475 tmt for meal and 8-35 tmt for oil.
  • The canola market traded higher on increased buying from technicals and commercials. Additional strength stemmed from strength in related veg oils. Canola closed up 4 bucks at $491.60.
  • Brazil farmers are thought to increase soybean plantings to 93.9 million acres this year. This compares to around 91.0 million acres last year.
  • Spreads: X/F 6 ¼ carry (widest has been 10-10 ¾, with full carry at 19.6 cents), X/H 4 carry, X/N 14 ¼ carry, X/X 6 ¾ carry.

Wheat

Wheat prices were higher on weakness in the US$ and more cuts to the French and Russian wheat crops. Optimism about the US gaining a place in the world export arena because of the steep decline in the US$. 

  • September closes: Mpls at $5.10 ¾, up 4 ½ cents, KC at $4.45 ½, up 8 ¾ cents and Chicago ta $5.33, up 9 ½ cents.
  • Weekly export sales estimate: 250-650 tmt.
  • Russia’s wheat estimate reduced to 79.3 by SovEcon, the French wheat crop is expected to be near 30.0 mmt versus 31.3 mmt previously and Argentina’s wheat crop is estimated at 20.0 mmt, down from 21.0 mmt previously.
  • Spreads: Mpls U/Z 13 ¾, Z/H 14 carry, Kansas City U/Z 10 carry, Z/H 10 ¼ carry, Chicago U/Z and Z/H at a 6-cent carry.