MORNING GRAINS COMMENTS

 

Jack Scoville

 

Tuesday, January 28, 2020

 

 


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

 


 

 

 

 

DJ USDA Grain Inspections for Export in Metric Tons - Jan 27

COUNTRY OF DESTINATION IS REPORTED AS KNOWN AT THE TIME OF EXPORTATION.

INFORMATION CONTAINED IN THIS REPORT REFLECTS EXPORTED GRAIN INSPECTED AND

WEIGHED THROUGH THE AUTHORITY UNDER THE U.S. GRAIN STANDARDS ACT.

NO ADDITIONAL ANALYSIS, COMPILATIONS OR DATA IS AVAILABLE. 

               GRAINS INSPECTED AND/OR WEIGHED FOR EXPORT

                  REPORTED IN WEEK ENDING JAN 23, 2020

                            -- METRIC TONS --

-------------------------------------------------------------------------

                                                   CURRENT     PREVIOUS

             ----------- WEEK ENDING ----------  MARKET YEAR  MARKET YEAR

  GRAIN      01/23/2020  01/16/2020  01/24/2019    TO DATE     TO DATE 

BARLEY            416         318           0       17,662        6,534

CORN          668,559     396,613     968,585   10,150,559   21,584,077

FLAXSEED            0           0           0          396          218

MIXED               0           0           0            0            0

OATS              200          48           0        2,266        1,793

RYE                 0           0           0            0            0

SORGHUM       142,217      31,005       7,605    1,130,903      572,227

SOYBEANS    1,038,840   1,206,140     944,680   25,214,900   20,484,903

SUNFLOWER           0           0           0            0            0

WHEAT         223,994     516,309     367,604   16,223,914   14,384,336

Total       2,074,226   2,150,433   2,288,474   52,740,600   57,034,088

-------------------------------------------------------------------------

CROP MARKETING YEARS BEGIN JUNE 1 FOR WHEAT, RYE, OATS, BARLEY AND

FLAXSEED;  SEPTEMBER 1 FOR CORN, SORGHUM, SOYBEANS AND SUNFLOWER SEEDS.

INCLUDES WATERWAY SHIPMENTS TO CANADA.

 

WHEAT: 

General Comments:  Wheat markets were mixed, with Chicago SRW a little lower and the other markets a little higher.  Futures had been sharply lower in reaction to news that the corona virus was spreading but recovered those losses as world market conditions remain firm.  The markets have run a long way on news of world production problems and firm world prices.  Russia has less Wheat this year and prices in the Black Sea region have strengthened.  The Ruble has also been firmer against the US Dollar and this has also caused Russian prices to form in the world market.  World prices will still be dictated by what happens in Europe and the Black Sea area and US prices will most likely remain a follower as the US tries to compete.  The lack of production in Russia and in the southern parts of the world means higher prices for now.  US farmers planted less Wheat than any time in the last 100 years so no real change in the world scenario of less supply is indicated.

Overnight News:  The southern Great Plains should get some light and mixed precipitation today and then dry conditions.  Temperatures should trend to near to above normal this week.  Northern areas should see mostly dry conditions except for some light precipitation on Thursday and Saturday.  Temperatures will average near to above normal.  The Canadian Prairies should see mostly dry weather.  Temperatures should be above normal.   

Chart Analysis:  Trends in Chicago are mixed.  Support is at 564, 560, and 557 March, with resistance at 575, 583, and 587 March.  Trends in Kansas City are mixed.  Support is at 481, 477, and 467 March, with resistance at 491, 500, and 504 March.  Trends in Minneapolis are down with objectives of 537, 522, and 516 March.  Support is at 542, 540, and 539 March, and resistance is at 556, 560, and 563 March.

 

RICE

General Comments:   Rice was lower for the week but recovered from its lowest levels to close with more moderate losses.  The trade was worried about how the corona virus could expand and hurt Asian demand, but the US sell into the west and not into the east.  Stocks in the west are tight and stocks are called tight in the US.  The tone remains firm but some speculators and producers have been selling.  The weekly charts still display a bullish market as futures have traded to levels not seen since 2014 on the weekly continuation charts.  Prices are profitable for producers at this time.  Some are also selling the next crop and the trade and open interest in the September contract is relatively large for the time of year.  More selling from producers of the next crop is expected on any further rally attempts.  Demand for US Rice remains generally positive and the export sales pace in general has been very good.  The US domestic market is now quiet with the harvest mostly done and no one real interested in selling.  Mills and exporters are thought to be covered for now but will need to step into the market to buy again soon. 

Overnight News:  The Delta should get showers and rains tomorrow and again late in the week.  Temperatures should be near normal.    

Chart Analysis:  Trends are mixed.  Support is at 1335, 1326, and 1316 March, with resistance at 1355, 1370, and 1380 March.

 

CORN AND OATS                   

General Comments:  Corn and Oats moved lower in reaction to news of the spread of the corona virus.  Ideas of lost demand hurt the market.  The markets got especially hurt by the weakness in petroleum products and the potential loss of ethanol related demand.  Export demand has been disappointing and ethanol and other industrial demand has started to improve but faces an uncertain road ahead.  Export demand was strong in the USDA reports released on Friday, but the trading world wants to see much more of these kinds of weekly sales before getting too excited.  Much of the improved ethanol demand will be seen if and when China starts to buy.  Feed demand was improved as seen in the latest quarterly stocks report.  That report showed less supplies on hand than expected.  There is little Corn available to the domestic cash market.  The market has been short Corn as farmers have been holding.  Corn could srill trade to 405 and then 420 based off the weekly charts and basis the nearby futures contract, but the rally potential is now in doubt after the selling on Friday.

Overnight News:  Mexico bought 124,355 tons of US Corn overnight.

Chart Analysis:  Trends in Corn are down with objectives of 370, 368, and 350 March.  Support is at 377, 373, and 371 March, and resistance is at 385, 394, and 396 March.  Trends in Oats are down with no objectives.  Support is at 295, 288, and 283 March, and resistance is at 305, 308, and 312 March.

 

SOYBEANS AND PRODUCTS

General Comments:  Soybeans and the products were lower on ideas of demand losses in part due to big production potential in Brazil and in part due to the effects of the corona virus now spreading through China and other countries.  In fact, five cases have now been confirmed in the US, mostly from travelers coming back for Wiehan in China.  Soybeans have left a well defined top with second swing objectives of 883 basis the March futures contract.  The first target was 905 seen on Friday.  The news that the US and China had reached agreement on a Phase One deal that covered agricultural goods was bullish but already part of the market.  New buying from China is expected but US prices will need to be competitive with those from South America.  Lower prices there will hurt overall demand here, and lower prices are very possible in Brazil.  Brazil is harvesting now and yield reports from the field indicate that a bumper crop is coming.  Argentina has been dry and more dryness is expected, so conditions and production potential are down there.  China will return in the end to buy at least as many Soybeans as it did before the trade war, but when is the main problem and is compounded by good growing conditions and ideas of big crops in South America. 

Overnight News:  

Chart Analysis:  Trends in Soybeans are down with objectives of 884 March.  Support is at 890, 888, and 883 March, and resistance is at 903, 911, and 915 March.  Trends in Soybean Meal are mixed to down with objectives of 291.00 March   Support is at 296.00, 293.00, and 290.00 March, and resistance is at 301.00, 304.00, and 307.00 March.  Trends in Soybean Oil are down with no objectives.  Support is at 3110, 3070, and 3040 March, with resistance at 3200, 3260, and 3300 March.

 

CANOLA AND PALM OIL        

General Comments:  Canola was lower along with the price action in Chicago Soybean Oil and Malaysian Palm Oil.  The fallout from the coronavirus affected this market as well as those in the US.  Demand from crushers is reported to be good and crush margins are reported to be strong.  Farmers are not selling.  Palm Oil was lower in consolidation trading before the Lunar New Year holiday. 

Overnight News:    

Chart Analysis:  Trends in Canola are down with no objectives.  Support is at 461.00, 459.00, and 456.00 March, with resistance at 468.00, 473.00, and 474.00 March.  Trends in Palm Oil are mixed.  Support is at 2820, 2800, and 2760 April, with resistance at 2970, 3000, and 3040 April.

 

Midwest Weather Forecast:   Some rain and snow off and on all week.  Temperatures should average near normal.

 

 

US Gulf Cash Basis

Corn

HRW

SRW

Soybeans

Soybean Meal

Soybean Oil

January

+50 Mar

+166 Mar

+110 Mar

+52 Mar

+12 Mar

N/A

February

+53 Mar

+112 Mar

+50 Mar

March

+60 Mar

+112 Mar

+47 Mar

 

 

 

 

 

DJ ICE Canada Cash Grain Close - Jan 27

WINNIPEG -- The following are the closing cash

canola prices from ICE Futures. 

Source: ICE Futures 

                     Price     Basis     Contract     Change

CANOLA

*Par Region          434.26    -35.24    Mar 2020     dn 3.60

Basis: Thunder Bay   468.50      7.00    Mar 2020     dn 8.00

Basis: Vancouver     489.50     20.00    Mar 2020     dn 8.00 

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 - January 28

  The following are prices for Malaysian palm oil in the cash market at 1000 GMT Tuesday, 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

Feb           697.50     -67.50      Unquoted   -        -

Mar           697.50     -65.00      Unquoted   -        -

Apr/May/Jun   657.50     -75.00      Unquoted   -        -

Jul/Aug/Sep   627.00     -72.50      Unquoted   -        -  

RBD palm olein, FOB, Malaysian ports

              Offer      Change      Bid        Change   Traded

Feb           700.00     -67.50      Unquoted   -        -

Mar           700.00     -65.00      Unquoted   -        -

Apr/May/Jun   660.00     -75.00      Unquoted   -        -

Jul/Aug/Sep   630.00     -72.50      Unquoted   -        -  

RBD palm stearin, FOB, Malaysian ports

              Offer      Change      Bid        Change   Traded

Feb           710.00     -50.00      Unquoted   -        -  

Palm Fatty Acid Distillate, FOB Malaysian ports

              Offer      Change      Bid        Change   Traded

Feb           680.00     -20.00      Unquoted   -        -  

Crude palm oil, Delivered Basis, South Malaysia

              Offer      Change      Bid        Change   Traded

Feb           2,700.00   -320.00      Unquoted   -        -  

Palm kernel oil, Delivered Basis, South Malaysia

              Offer      Change      Bid        Change   Traded

Feb           200.00     -29.00      Unquoted   -        -  

($1=MYR4.0840)

 

 

 

 

 

 



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Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures.

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