MORNING GRAINS COMMENTS

 

Jack Scoville

 

Thursday, October 17, 2019

 

 


Price Futures Group, CBOT

Chicago, IL

(312) 264-4322

jscoville@pricegroup.com

 

JSL, SA de CV

San Salvador, El Salvador (503) 2260-7806 jslsadecv@comcast.net

 

JSL, SA

San José, Costa Rica (506) 2282-7024 

jslsa@comcast.net

 


 

 

 

WHEAT                                 

General Comments:  Wheat markets were higher on news that Egypt paid higher prices for Russian, Ukrainian, and French Wheat at its tender yesterday.  The sale shows that world prices are turning up and that has provided some room for US prices to rally as well.  The charts still suggest that higher prices are coming this week.  Futures have been supported lately by the very cold weather and snow that moved through parts of the Great Plains and the western half of the Midwest.  The snow buried some of the remaining Spring Wheat harvest and made planting the Winter Wheat that much more difficult.  Some of the Spring Wheat will be lost or will see reduced quality.  Winter Wheat planting and emergence has been good until now.  The weather will start to moderate this week but the damage has been done.  Wheat in the Canadian Prairies has seen the same wet and cold weather and reports of yield and quality losses are now being heard.  Winter Wheat planting is slow in parts of Europe, mostly France, due to dry weather.  The world cash market is firm.  Export demand for US Wheat has been fair. 

Overnight News:  The southern Great Plains should get mostly dry weather this week.  Temperatures should be variable.  Northern areas should see mostly dry conditions.  Temperatures should be below normal.  The Canadian Prairies should see mostly dry weather.  Temperatures should be below normal.    

Chart Analysis:  Trends in Chicago are up with objectives of 521, 522, and 538 December.  Support is at 504, 501, and 497 December, with resistance at 515, 522, and 527 December.  Trends in Kansas City are up with objectives of 433, 434, and 436 December.  Support is at 417, 414, and 401 December, with resistance at 428, 433, and 439 December.  Trends in Minneapolis are mixed to up with objectives of 564 and 581 December.  Support is at 544, 541, and 536 December, and resistance is at 552, 557, and 560 December.

 

RICE

General Comments:   Rice was higher on what appeared to be speculative buying after holding the lows of Tuesday.  There was no real news to prompt the rally, but the Long Grain harvest is winding down amid mixed yield reports and grains markets including Rice usually start to rally once the bulk of the harvest has passed.  It is the tail end of harvest and some speculators are hoping for producer selling.  Some producers are delivering on contracts but most will be content to wait and see how the prices act over the next few weeks.  The potential for tight supplies in Long Grain Rice are there and should support futures prices.  The harvest is winding down in all areas except California and field yields appear to be generally below last year.  Milling quality is said to be lower on later harvested Rice but was very good for the early harvested Rice.  Basis levels are reported to be firmer as the harvest comes to an end and the Rice gets put in on farm storage. 

Overnight News:  The Delta should get mostly dry conditions.  Temperatures should be near to above normal.

Chart Analysis:  Trends are mixed.  Support is at 1183, 1179, and 1173 November, with resistance at 1208, 1217, and 1220 November.

 

CORN AND OATS                   

General Comments:  Corn closed unchanged to a little lower and Oats closed lower after making new highs for the move.  Its possible that the Oats rally is running out of steam as the weather in Canada is said to be improving.  Corn carry spreads were weak and that implies that some Corn was moving in cash markets.  Cash selling has not been confirmed and most producers are more interested in checking crops for damage after the cold weekend or harvesting.  It was a freeze even in many areas and the growing season ended in these areas.  Some crops were damaged and loss estimates are around 200 million bushels for now.  Conditions remain better east of the Mississippi as temperatures did not get below freezing except for far northern areas that do not really produce grain or oilseeds.  Demand remains hard to find.  Demand ideas remain weak as there have been very few announcements of big sales of Corn in the daily system and as EPA released its plan to restore ethanol demand that the ag side said could hurt farmers more than help.

Overnight News:  

Chart Analysis:  Trends in Corn are mixed.  Support is at 388, 385, and 378 December, and resistance is at 393, 397, and 399 December.  Trends in Oats are up with no objectives.  Support is at 299, 294, and 289 December, and resistance is at 305, 309, and 312 December.

 

SOYBEANS AND PRODUCTS

General Comments:  Soybeans and Soybean Meal were lower on fears that the US side is overstating the deal with China and on ideas of increasing harvest selling.  USDA showed greater than expected harvest progress in the reports released Tuesday as farmers have decided to harvest Soybeans before Corn.  There is also talk that producers in South America are starting some sales of the next crop as the Real has become weak and is testing recent lows.  There has been no new indication of demand from China and this has kept some speculators away from buying.  The trade wants to see Soybeans being bought and shipped, but ideas are that none of this will happen right away.  China could wait now until a more formal agreement is in place.  Soybean Oil was firm on spreads against Soybean Meal.  The weather has started to moderate after the big chill and snow of last week and traders are looking for loss reports.  Ideas currently are that about 100 million bushels of Soybeans were lost.  The market will start to listen to yield reports from the country for both Soybeans and Corn to see if the lower yields are justified.  It is possible that yields for both products will be lower than the latest USDA estimates.  The market will also start to keep a closer eye on the weather in South America.  It has been too dry in parts of central and northern Brazil and the planting progress has been delayed.  There are forecasts for more rains to allow better planting progress appearing in the next couple of weeks. 

Overnight News:  

Chart Analysis:  Trends in Soybeans are mixed to up with objectives of 945 November.  Support is at 924, 919, and 911 November, and resistance is at 933, 945, and 960 November.  Trends in Soybean Meal are mixed to down with objectives of 302.00 and 296.00 December.  Support is at 304.00, 301.00, and 300.00 December, and resistance is at 309.00, 312.00, and 314.00 December.  Trends in Soybean Oil are up with objectives of 3120 December.  Support is at 3020, 3000, and 2980 December, with resistance at 3070, 3110, and 3130 December.

 

CANOLA AND PALM OIL        

General Comments:  Canola was a little lower on price action in Chicago.  The weather is starting to improve for harvesting but there is talk of losses due to cold and snowy weather earlier.  The market has held in a trading range for the last week or so and should be able to break out one way or another.  The breakout will probably be down as the harvest gets rolling again.  Harvesting is almost complete in Saskatchewan and is moving to completion in Manitoba.  Palm Oil was higher despite worries that weaker export demand would continue.  A weaker currency and word that Malaysia will try to improve diplomatic relations with India after recent disparaging comments made in Malaysia about is biggest buyer helped the market move higher.  Vegetable oils are firm and Palm Oil is trying to form a bottom.  The charts show that futures are turning trends up again.

Overnight News: 

Chart Analysis:  Trends in Canola are mixed.  Support is at 458.00, 455.00, and 451.00 November, with resistance at 465.00, 468.00, and 469.00 November.  Trends in Palm Oil are mixed to up with objectives of 2260 and 2310 January.  Support is at 2230, 2220, and 2190 January, with resistance at 2260, 2280, and 2300 January.

 

 

Midwest Weather Forecast:   Mostly dry conditions through Saturday, then showers.  Temperatures should average near to below normal.

 

US Gulf Cash Basis

Corn

HRW

SRW

Soybeans

Soybean Meal

Soybean Oil

Octember

+37 Dec

+170 Dec

+75 Dec

+37 Nov

+12 Dec

N/A

November

+42 Dec

+85 Dec

+43 Nov

December

+51 Dec

+85 Dec

+39 Jan

All basis levels are positive unless noted as negative

 

DJ ICE Canada Cash Grain Close - Oct 16

WINNIPEG -- The following are the closing cash

canola prices from ICE Futures. 

Source: ICE Futures 

                     Price     Basis     Contract     Change

CANOLA

*Par Region          433.40    -28.00    Nov 2019     up 1.50

Basis: Thunder Bay   470.00     10.00    Nov 2019     dn 1.40

Basis: Vancouver     480.00     20.00    Nov 2019     dn 1.40 

All prices in Canadian dollars per metric tonne. 

*Quote for previous day 

Source: Commodity News Service Canada

(news@marketsfarm.com, or 204-414-9084)

 

DJ Malaysian PM Cash Market Prices for Palm Oil - Oct 17

  The following are prices for Malaysian palm oil in the cash market at 1000 GMT Thursday, supplied by commodity broker Matthes & Porton Bhd.

  Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.  

Refined, bleached and deodorized palm oil, FOB, Malaysian ports

              Offer      Change      Bid        Change   Traded

Oct           535.00     -02.50      Unquoted   -        -

Nov           535.00     -02.50      Unquoted   -        -

Dec           542.50     -02.50      Unquoted   -        -

Jan/Feb/Mar   562.50     -02.50      Unquoted   -        -  

RBD palm olein, FOB, Malaysian ports

              Offer      Change      Bid        Change   Traded

Oct           537.50     -02.50      Unquoted   -        -

Nov           537.50     -02.50      Unquoted   -        -

Dec           545.00     -02.50      Unquoted   -        -

Jan/Feb/Mar   565.00     -02.50      Unquoted   -        -  

RBD palm stearin, FOB, Malaysian ports

              Offer      Change      Bid        Change   Traded

Oct           535.00       0.00      Unquoted   -        -  

Palm Fatty Acid Distillate, FOB Malaysian ports

              Offer      Change      Bid        Change   Traded

Oct           435.00       0.00      Unquoted   -        -  

Crude palm oil, Delivered Basis, South Malaysia

              Offer      Change      Bid        Change   Traded

Oct           2,180.00    0.00      Unquoted   -        -  

Palm kernel oil, Delivered Basis, South Malaysia

              Offer      Change      Bid        Change   Traded

Oct           144.00     +02.00      Unquoted   -        -  

($1=MYR4.1820)

 

DJ China Dalian Grain Futures Closing Prices, Volume - Oct 17

Soybean No. 1  

Turnover: 154,496 lots, or 5.33 billion yuan  

        Open    High    Low  Close   Prev.  Settle  Ch.      Vol      Open

                                    Settle                        Interest

Nov-19  3,375  3,375  3,348  3,348   3,370   3,366   -4       10       282

Jan-20  3,426  3,438  3,385  3,416   3,419   3,408  -11  132,498   194,210

Mar-20  -          -      -  3,444   3,444   3,444    0        0        34

May-20  3,688  3,708  3,681  3,700   3,694   3,694    0   18,128    69,538

Jul-20  3,702  3,730  3,702  3,730   3,724   3,716   -8        4        28

Sep-20  3,768  3,780  3,742  3,762   3,768   3,761   -7    3,856     5,998  

Corn  

Turnover: 624,220 lots, or 11.61 billion yuan  

        Open    High    Low  Close   Prev.  Settle  Ch.      Vol       Open

                                    Settle                         Interest

Nov-19  1,805  1,810  1,800  1,805   1,805   1,805    0    2,506     12,854

Jan-20  1,849  1,854  1,843  1,848   1,848   1,847   -1  465,228  1,191,138

Mar-20  1,871  1,875  1,866  1,870   1,867   1,870    3   78,978    313,070

May-20  1,919  1,925  1,916  1,920   1,920   1,920    0   67,248    531,176

Jul-20  1,947  1,949  1,942  1,948   1,945   1,946    1      208      8,250

Sep-20  1,965  1,973  1,965  1,970   1,968   1,970    2   10,052     69,200  

Soymeal  

Turnover: 1,647,356 lots, or 48.64 billion yuan  

        Open    High    Low  Close   Prev.  Settle  Ch.        Vol       Open

                                    Settle                           Interest

Nov-19  3,013  3,016  2,991  3,000   3,013   3,000  -13      5,664      7,984

Dec-19  2,986  3,005  2,985  3,002   3,003   2,998   -5     63,074    247,972

Jan-20  2,972  2,976  2,953  2,968   2,976   2,966  -10  1,233,558  2,164,974

Mar-20  2,932  2,946  2,924  2,946   2,939   2,936   -3         70        774

May-20  2,891  2,896  2,876  2,892   2,889   2,887   -2    306,370  1,307,128

Jul-20  2,899  2,906  2,891  2,906   2,900   2,899   -1         62      4,914

Aug-20  2,892  2,906  2,892  2,906   2,905   2,898   -7          8         50

Sep-20  2,934  2,940  2,919  2,935   2,933   2,931   -2     38,550    257,630  

Palm Oil  

Turnover: 906,430 lots, or 43.88 billion yuan  

        Open    High    Low  Close   Prev.  Settle  Ch.      Vol      Open

                                    Settle                        Interest

Oct-19  -          -      -  4,880   4,880   4,880    0        0         0

Nov-19  -          -      -  4,836   4,836   4,836    0        0         4

Dec-19  4,738  4,870  4,738  4,870   4,866   4,812  -54        6         6

Jan-20  4,812  4,850  4,788  4,800   4,772   4,816   44  824,590   479,584

Feb-20  -          -      -  4,898   4,854   4,898   44        0       708

Mar-20  -          -      -  4,976   4,932   4,976   44        0         4

Apr-20  -          -      -  4,978   4,934   4,978   44        0         6

May-20  5,078  5,114  5,060  5,078   5,048   5,082   34   79,148   180,020

Jun-20  -          -      -  5,096   5,096   5,096    0        0         6

Jul-20  -          -      -  5,072   5,072   5,072    0        0       602

Aug-20  -          -      -  5,040   5,008   5,040   32        0         2

Sep-20  5,118  5,148  5,106  5,118   5,092   5,124   32    2,686    17,352  

Soybean Oil  

Turnover: 727,526 lots, or 43.88 billion yuan  

        Open    High    Low  Close   Prev.  Settle  Ch.      Vol      Open

                                    Settle                        Interest

Nov-19  -          -      -  5,966   5,966   5,966    0        0         4

Dec-19  -          -      -  5,888   5,888   5,888    0        0        10

Jan-20  5,994  6,050  5,994  6,032   5,974   6,022   48  595,192   688,984

Mar-20  6,058  6,096  6,058  6,060   6,016   6,074   58       10       504

May-20  6,062  6,092  6,048  6,066   6,038   6,068   30  126,330   289,472

Jul-20  -          -      -  6,078   6,048   6,078   30        0       526

Aug-20  -          -      -  5,982   5,982   5,982    0        0         0

Sep-20  6,100  6,128  6,090  6,108   6,078   6,112   34    5,994    53,024  

Notes:

1) Unit is Chinese yuan a metric ton;

2) Ch. is day's settlement minus previous settlement;

3) Volume and open interest are in lots;

4) One lot is equivalent to 10 metric tons.

 

 

 

 

 

 

 



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