Written Commentary
MORNING OUTLOOK
Grains are mixed. SX is down 3 cents and near 12.53. SMZ is near 373.4. BOZ is near 58.81. Jan soybean board crush margin +198. CZ is down 1 cent and near 5.75. WZ is down 5 cents and near 8.21. KWZ is down 6 cents and near 8.30. MWZ is down 8 cents and near 10.13. Grain futures may be overbought and due for a correction.
US stocks are mixed. US Dollar is mixed to higher. Crude is higher.
US Midwest weather dry. EU and Black Sea dry. Argentina, Brazil weather favorable. S Brazil dry. Dalian soybean and soyoil futures are lower. Soymeal, palmoil and corn are higher. Biden and Xi talk lasted 2 hours. No discussion on China Phase 1 obligation.
Corn futures lower on slow US exports. Exports down 6 pct from last year. 91 pct of crop harvested. End users are short and could be net buyers on breaks. Speculators also want to buy due to inflation talk. Some feel CH may be in 5.50-6.00 range. Drier Argentina S Brazil weather could force CH to 6.25-6.75. Argentina corn 61 pct planted. Concern about maxi currency devaluation. Higher export taxes.
Favorable South America weather and lower US exports could keep SF in a 11.80-12.50 range. Dry S Brazil and Argentina weather needed to push SF/SH over 13.00. US farmer selling could limit gains. US soybean exports down 33 pct vs last year and USDA 10 pct drop. US harvest 92 pct. US Sep NOPA soybean crush 184 mil bu, Soyoil stocks 1,835 mil lbs and highest since May, 2020.
KC futures made new highs on talk of tight World exporter supplies. Lower overnight. WZ and KWZ resistance 8.50. Some feel KWH could rally to 8.75-9.00 if Russian and EU exports slow. Algeria delayed wheat tender waiting addition offers. Prices $20 above last purchase.
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