Ami Heesch

Jul 30, 2020

Ami L Heesch 

Highlights

The grain markets were mixed with the row crops steady to a bit higher and the wheat market and canola a bit softer. Mpls did manage to close on the greener side of life as the Northern Plains hopes for beneficial moisture to finish off the spring wheat crop. The world at large was on the defensive on economic uncertainty from spiraling cases of the CoronaVirus and the ongoing battle between the US and China. 

  • The energy markets are mostly weaker with crude oil down 95 cents at 40.32/barrel.
  • The US$ is down 497 at 92.95 (levels not seen since May 2018), the gold market is down 5-6 bucks at 1954/ounce and the CD$ is down 0.00435 at 0.74405.
  • DJIA down 225 at 26313, S&P down 3-4 at 3248 and NASDAQ up 45 at 10587.
  • First Notice Day for August futures is tomorrow. Longs get reported after today’s close.
  • USDA data to be released on August 12 at 11 AM CDT. 

Corn

The corn market lacked strength despite the ginormous Chinese corn purchase. Position evening prior to the end of the month, and weakness in outside markets provided pressure to the corn market. Gains were kept in check form favorable temperatures across the US Midwest. September closed ¾ cent above its contract low. 

Oilseeds

Large weekly export sale numbers out this morning, gave the soybeans a bit of a boost to the upside, despite the lack of new Chinese business announced in the daily sales report. The milder temperatures across much of the US Midwest seems to be the heavy on the soybeans.  

  • Closes: November at $8.88 ¾, up 3 ½ cents, January at $8.94 ¾, up 3 ½ cents, July at $9.02 ¼, up 3 cents. The products were firmer with meal up 2-4 bucks and oil up 53 points.
  • Gulf premiums were 2 cents firmer for August. Processor bids were mostly unchanged with Decatur 2 cents weaker.
  • Weekly export sales came in at 3.6 mmt, well above what the trade was expecting.
  • Expectations are that there will be no soybean deliveries against the August contract, and that the meal and oil deliveries from July could be re-delivered against the August.
  • The canola market took a step back from its 21-month high, on a bout of profit taking. November closed down 1.20 at $490.00 per cwt.
  • Spreads: X/F 5 ¾ carry, X/H 4 carry, X/N 13 ½ carry, X/X 6 ¾ carry.

Wheat

The wheat market was mixed with KC and Chicago on the defensive from lack of fresh supportive news. Prices drew additional pressure from technical selling. Mpls stood strong, if you can say that being only up a penny or so.  North Dakota is in need of some beneficial moisture. There have been forecasts suggesting the rains may come but has been mostly disappointing so far. Spring wheat harvest is 3-4 weeks out yet.  

  • September closes: Mpls at $5.12 ¼, up 1 ¼ cent, KC at $4.39 ¾, down 6 cents, Chicago at $5.28 ¾, down 4 cents.
  • Weekly export sales were at 677 tmt, above the top end of the trade estimates.
  • EU milling wheat prices firmer on lack of farmer selling. Gains were limited from strength in the Euro and spillover weakness in the US market.
  • The Argentine wheat crop is under the gun from extended periods of hot/dry weather and not they speak of frost, of all things.
  • Spreads: Mpls U/Z 13 ¾  carry, Z/H 13 ½ carry......Kansas City U/Z 10 ½ carry, Z/H 10 ¼ carry........Chicago U/Z 6 ½ carry, Z/H 6 ¼ carry.

US Dollar