Ami Heesch

Sep 16, 2020

Ami L Heesch 

Highlights

Grains were mostly stronger on demand and crop worries. Hurricane Sally muscles her way around Alabama and the Carolinas (moving slowly and dropping lots of water, creating serious flooding in some parts). Snowflake stock traded its first day today. The Federal Reserve left interest rates at low levels. 

  • Weekly export sales out tomorrow at 730 AM CDT.
  • USDA small Grains Summary and Sep 1 Grain Stocks reports are scheduled for September 30th at 11 AM CDT.
  • The energy markets squirreled higher form hurricane Sally, with crude oil up 1.89 at 40.81/barrel.
  • The US$ turned higher, trading up 0.052 at 93.102, gold up a buck at 1959 and CD$ up a freckle at 0.75925.
  • DJIA higher but lost earlier strength, trading up 37 at 28032, S&P down 14 at 3392, NASDAQ down 140 at 11050. 

Corn

Corn prices traded higher on borrowed strength in the soy complex and the energy markets. Additional support came from fund buying. Ethanol stocks declined to their lowest level since January 2017. Ukraine corn production and exports were revised downward from lack of beneficial moisture.   

  • Closes: December at $3.71 ¾, up 5 ¾ cents, March at $3.80 ¾, up 5 cents, July at $3.89 ¼, up 4 ¼ cents.    
  • CIF premiums were mostly unchanged for Sept/Oct.
  • Weekly ethanol production declined 15k barrels per day to 926k barrels per day. Stocks declined 195k million barrels to 19.8 million barrels.
  • Average trade estimate for weekly export sales: 800 tmt-109 mmt.
  • Spreads: Z/H 9 carry.

Oilseeds

Soybeans were sharply higher on demand for US beans, with another flash sale announced this morning. Market chatter suggests 8-20 cargoes of US soybeans have been sold. November hits new contract highs ( on a continuous chart for nearby it reached levels not seen since June 2018). 

  • Closes: November at $10.11 ½, up 2 cents (Woot! Woot!), March at $10.14 ½, up 18 ½ cents, July at $10.15 ½, up 15 ½ cents. The products followed the beans higher with meal up nearly 7 bucks and oil up 74 points. November canola closed up $10.40 at $531.30/cwt.
  • CIF premiums were 1 cent weaker for September and October.
  • USDA announced the sale of 327k tonnes of beans to China for 20/21.
  • Hearing we could be in soybean harvest pretty good by the weekend in western ND.
  • Average trade estimate for weekly export sales: 1.5-2.8 mmt for beans, 225-550 tmt for meal and 0-40 tmt for soyoil.
  • The canola market rose to the occasion from technical buying and spillover strength in the US soy complex.  Additional support stems from concerns of lower than expected yields form unfavorable weather conditions during the growing season. Manitoba canola harvest was reported at 54% complete versus the 3-year average of 69%.
  • Spreads: X/F 4 carry.

Wheat

The wheat market traded higher in sympathy with the soy complex. Chicago moved higher after dipping down to the Aug 26 low of $5.33 ¼. 

  • December closes: Mpls at $5.30, up 5 ¾ cents, KC at $4.74 ½, up 6 ½ cents, Chicago at $5.42 ¼, up 4 cents.
  • Paris milling wheat prices turned higher on assessments of Algeria possibly looking to Black Sea origins for their future wheat tenders which could make competition for French exporters. 
  • Egypt’s GASC bought 235k tonnes of optional origin wheat from $249-$251/tonne C&F (60k Polish and 175k Russian).
  • Average trade estimate for weekly export sales at 300-700 tmt.
  • 21/22 winter wheat acres are expected to be up 2-3% at 31.3 million acres ( fall moisture, fall insurance price around $4.90 KWN1, $4.98 for KWU1 and $5.06 WU1, early row crop harvest). There are ideas acres could be closer to 5-10% more.
  • 21/22 other spring wheat acres are estimated at 11.6 million versus 12.2 this year(11.6 spring / 400k hard white spring). Spring wheat acres could be 11.0-11.2 million acres.
  •  Spreads: Mpls Z/H 12 ¾ carry, Kansas City Z/H 10 ¾ carry, Chicago Z/H 9 carry, Mpls/KC Z 55 ½ cent premium Mpls Dec.