Ami Heesch

Oct 26, 2020

Highlights

The grain markets were mostly lower on outside influences. Much needed moisture fell across the US Plains, with expectations of more to come.  Tropical Storm/ Hurricane Zeta makes its way toward Florida. Louisiana and the Carolinas.

  • New daily price limits set to change on November 1st.  Corn and wheat limits look to be unchanged at 25 cents for corn, 40 cents for KC/Chicago and 60 cents for Mpls wheat. Soybeans limit expected to go from 60 cents to 70 cents, meal from 200 to 250 and oil from $20 to $25.
  • Renewed worries of the spread of the CoronaVirus in Europe and the US, along with what looks to be a stalemate in the stimulus aid pressured energy and equity markets.
  • First Notice Day for November futures is Friday with long positions being reported after the close on Thursday.
  • The energy markets are mostly weaker with crude oil down 1.24 at 38.61/barrel.
  • The US$ is up 272 at 93.04, the gold market is up a freckle at 1902/ounce and the CD$ is down 0.0033 at 0.75760.
  • DJIA is down 748 at 27587, S&P down 71 at 3381 and the NASDAQ down 248 at 11299.

     

    Corn

    Corn prices saw pressure from weakness in the wheat, energy and equity markets. Additional pressure came from a stronger US$. Harvest delays continue from rain events across the ECB and recent snow/rain mix in the WCB.    

  • Closes: December at $4.17 ¼, down 2 cents, March at $4.17 ¾, down 2 ½ cents, July at $4.18 ¾, down 2 cents.
  • Most months hit resistance near the $4.20 area.
  • CIF premiums were 2 cents firmer for Oct/ FH Nov and unchanged for LH Nov. Cash markets remain strong.
  • Weekly export inspections were disappointing at 636 tmt.
  • Harvest progress is estimated at 73% complete (68-75) versus 60% last week.
  • Spreads: Z/H ¾ carry, X/N 1 carry, Z/Z 26 inverse.

     

    Oilseeds

    Soybeans started the session lower but managed to pull themselves back into positive territory for Nov/Jan/March. Weekly export inspections were decent for this past week, leaving some thoughts that we may see an increase in soybean exports on the next USDA monthly S&D report.

     

  • Closes: November at $10.86 ¾, up 3 cents, March at $10.67 ¾, up 1 ¾ cents, July at $10.57 ¾, down 2 cents. The products were stronger with meal up 2-3 bucks and oil up 31 points.
  • The Nov & Jan seemed to have topped out just short of $10.90.
  • CIF premiums were mostly unchanged for O/N. Cash markets remain firm.
  • Weekly export inspections were solid at 2.7 mmt.
  • Harvest progress expected to be 86% complete (83-89) versus 75% last week.
  • Spreads: X/F 4 ¼ inverse, F/H 14 ¾ inverse.

     

    Wheat

    The wheat market got thumped on beneficial moisture for the US Southern Plains and the Black Sea Region. Prices drew additional pressure from strength in the US$ and spillover weakness in the equity markets.

     

  • December closes:  Mpls at $5.65 ½, down 12 cents, KC a t $5.51, down 18 ¾ cents and Chicago at $6.19 ½, down 13 ¼ cents.
  • Weekly export inspections were disappointing at 364 tmt.
  • Planting progress is estimated at 86% complete (84-88) versus 77% last week, with conditions expected to be near 52% G/E (42-65).
  • Paris milling wheat prices dew pressure from sharp losses in the US wheat market.
  • Spreads: Mpls Z/H 10 carry, Kansas City Z/H 7 carry, Chicago Z/H ¼ carry. MWZ sits at a 12 ¾ premium to the KWZ.