News Source: SETZ

Morning Comments; Monday, October 25th, 2021

Much of this week will be spent getting positions in place ahead of month end. This is more of a factor for the November contracts as they will go into delivery. Soybeans will see the most activity from this, although many of the existing November contracts have already been rolled to deferred months. Aside from this contract positioning trade will continue to focus on many of the same factors this week that it has for the past several. The main one of these is harvest activity with some reports of activity winding down in a few regions of the Corn Belt. As this happens, we are starting to see elevated country movement as on-farm storage facilities are filling. This is beneficial for processors who have been pushing for deliveries. It is interesting to see than many of the deliveries that are taking place are going end-user direct and bypassing elevators. Trade is taking this as a sign the quality of this year’s crops is not as bad as initially thought. The real question is what will be done with inventory once harvest wraps up. Many farmers claim they will store this year’s crop and market later on which should help support interior basis values.

Highlights
* High commodity values not hurting demand
* Margins offsetting higher costs
* Input costs impact on acres debated
* Price ratio favors corn over soybeans
* Farmers may look for alternative crops
* Early SAM harvest expected this year
* Elevated double cropping in SAM likely
* Canada/China trade tensions easing
* US gasoline supply -4% on the year
* FND on Nov contracts is Friday

Corn
* Privates raise US yield estimate  
* Some now 4 bpa above USDA 
* Brazil exports remain larger than expected  
* Ukraine harvest slow to build
* US corn carryout may be too high

Soybeans
* Private analysts close to USDA yield 
* Harvested acres may be higher
* China sourcing most needs from Sam  
* Brazil harvest to start in December
* US crush capacity to expand 250 mbu in 2 years

Wheat
* Rains delay Chinese plantings
* High returns continue to favor plantings 
* China shopping for US offers 
* SAM yields being questioned
* SAM crops still better than last year

Livestock
* Oct 1st COF 98.5%
* Sep placements and marketings were 97% 
* Beef in cold storage at 435.3 mil pounds
* Pork in CS 466.4 mil pounds
* Pork bellies in CS 13 mil pounds 


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Friday, October 22nd, 2021

Given the need for large crops of all three major crops this year we are seeing more attention on acres than usual, especially for this time of the year. The most talked about of these is for corn where we are already seeing predictions for lower acreage than last year. This is the result of high input costs, especially fertilizer. Fertilizer values have doubled in some cases from last year and industry officials claim they could be even more expensive by next spring. A greater concern on fertilizer may be availability regardless of the cost. Several of the United States’ fertilizer suppliers are limiting exports to ensure they have adequate products for needs which is tightening world inventories. This news is being welcomed by the soy complex as it may prevent the need to push for acres to continue building reserves. While inputs are a leading reason for a potential decline in corn plantings next year, so are returns for other crops. Two of the most notable are wheat and cotton. This is especially the case in fringe areas where these types of crops tend to yield better. There are many scenarios being laid out on potential acreage for next year, and we will undoubtedly see more prior to spring planting.

Highlights
* World Bank predicts higher Ag prices into 2022
* Ukraine raises grain export forecast
* Total Ukraine grain crop +15 mmt last year
* Russia sees favorable winter crop weather
* US barge freight becomes volatile
* World energy values to stay elevated
* Coal values +100% since early September
* Half of US exports are through PNW
* Analysts predict sizable acreage shift this year
* November options expire today

Corn
* IGC raises world crop 1 mmt,  
* IGC increases total grain demand 3 mmt
* US corn $15/mt under Ukraine  
* EU bumps crop estimate 2.6 mmt
* Export sales +2.1% from last year

Soybeans
* Chinese crush remains limited 
* US crush to increase
* Correction to global veg oil market expected 
* Argentine exports -2.5 mmt on the year
* Yearly export sales -35.5%

Wheat
* China sourcing needs from France
* China Sep imports -40% from 2020 
* Yearly Chinese demand still +25% 
* US Plains need more precip
* Year to date sales -20% from 2020

Livestock
* Oct 1st COF estimated 99% last year
* Sep placements 101.4%, marketings 97.2% 
* 2021 beef sales MY low at 7,800 mt
* 2022 beef sales just 200 mt
* 2021 pork sales 20,900 mt


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Thursday, October 21st, 2021

There are two vast differences in opinions forming on current stocks to use figures on grains and oilseeds. Domestically we have started to see stocks to use increase on corn and soybeans in recent months. These are now projected at 10.1% on corn and 7.3% on soybeans for the end of the 2021/22 marketing year. These are both right at levels where rationing would be considered but not necessarily needed. This is a considerable change in the mindset of the market from just a few months ago when the market was worried over the possibility of depleting domestic reserves, especially on soybeans. As a result, we have seen much less urgency in the market, and less buying interest from the speculative crowd. We have seen the same change in global figures, although these numbers are not as negative. This is more of a case on corn where even with an 83 million metric ton increase in production from last year, our reserves at the end of the year are only forecast to increase 12 million metric tons. In the world soy complex we are expected to see a 5.4 million metric ton rise in stocks, even with production climbing 20 million metric tons. These figures show how important it is for large global crops every year.

Highlights
* Chinese buyers focus on South America
* Several Chinese processors remain offline 
* Global energy shortages an issue
* World inflation continues to build
* Covid continues to impact manufacturing 
* Brazil planting pace 2nd highest on record
* November options expire tomorrow
* This likely last big week for harvest
* Weekly ethanol production 3rd highest on record
* US ethanol stocks rising with production

Corn
* US becoming favored source for needs 
* Ethanol demand is rising 
* Ukraine selling to decline  
* Chinese corn cheaper than wheat
* Active Argentine planting reported

Soybeans
* China to auction soybeans today 
* ECB basis 30c better than average
* WCB basis 40 cents above average 
* US crush near full capacity
* Few delays to SAM planting

Wheat
* Exporters try to ration supplies
* US wheat most affordable globally 
* Russian taxes continue to rise
* US has little unshipped wheat sold
* EU exports +45% in past three months

Livestock
* Chinese pork production +43% last quarter
* China pork production in 3rd quarter a 3-year high
* US hog weights rising  
* Average US hog weight +1 pound from average
* US slaughter slowed from Covid guidelines 


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning Comments; Wednesday, October 20th, 2021

Country movement of newly harvested corn and soybeans has been up in the past few weeks, but overall deliveries are not as high as in most years. Reports from interior terminals indicate that most of these deliveries are forward contracted bushels. Farmers across the Corn Belt are reporting ample storage space to tuck away this year’s crops and showing no urgency in extending sales coverage at this time, especially with futures retreating in recent sessions. More movement has taken place in regions with lower storage space, but even then, movement is minimal compared to production reports. The question in the cash market now is if farmers will continue to hold this inventory and when the next flush of stored inventory will take place. Normally we see movement at year end as cash positions are balanced. Historically we also see elevated movement after the 1st of the year when cash flow is needed for new crop expenses. Many commodity buyers report high volumes of deferred income from last year though and this may be used for expenses rather than making new sales. The possibility of this is keeping basis values firm, even with harvest and high yield reports.  

Highlights
* Favorable rains continue in Brazil
* Argentina turning dry 
* Brazil firms raise export forecasts 
* La Nina to last through February
* US tractor sales +11% from last year
* Combine sales +18% on the year
* US DDG values weaken
* US ethanol most affordable in global market
* Brazil ethanol -15 cents to US 
* Another favorable weekly ethanol report expected

Corn
* Chinese corn at $10.00/bu 
* Rally may push buyers to US 
* US corn acres expected to decline  
* Farmers continue to hold corn
* Export sales remain above last year

Soybeans
* Quality impacting importer choices 
* Most concern on Chinese demand
* US crush margins near $2.00 
* Farmers continue to make sales
* China booking all new crop from Brazil

Wheat
* China raises loan rates on wheat
* Rains slow US plantings 
* China to auction 1 mmt from reserves today
* Russian exports -1.6% this year
* Buyers starting to shop US offers

Livestock
* US beef exports +17% from last year
* Yearly beef exports at 720,000 mt
* Yearly pork exports at 1.6 mmt  
* Pork exports -9.4% from last year
* US cash trade remains thin


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Tuesday, October 19th, 2021

While not a significant amount the US harvest pace has been slowed due to widespread rainfall. This has not been a major concern for the market though as the overall harvest pace is still ahead of the five-year average. Not only has weather slowed harvest, but so has better production as activity moves into the heart of the Corn Belt and higher yields are reported. The slowing harvest pace has also been beneficial for processors and commercial terminals as it allows them to better handle incoming bushels. One difference between this year’s crops and those in recent history is the record production that is being seen in the fringe areas. Much of this is in regions that are not accustomed to handling crops the size of this year’s, and the slow downs is preventing terminals from being overrun. The slower deliveries in the interior market are also beneficial for the export market as logistics are not back to full capacity from Hurricane Ida. Interior processors went into this year’s harvest with very little inventory which has been a benefit for commodity flow.  

Highlights
* Processors push bids to capture climbing margins
* Soybean crush margin nearly $2.00 
* Ethanol margins at 50 cents 
* Brazilian coffee trade -26.5% due to container shortage
* Financial firms showing better earnings
* US ethanol exports continue to rise
* Ukraine grain yields remain elevated
* Input costs causing acreage shifts
* Analysts predict 3 mil decline to corn plantings
* Harvest pressure starting to lift

Corn
* Harvest at 52%, average is 41% 
* Analysts raise US yield estimates
* Corn displacing feed wheat  
* Quality improves as harvest progresses
* France to cut acres over input costs

Soybeans
* US harvest at 60%, normal is 55% 
* Privates predict 52 bpa yield
* Soybean demand likely still too high
* India lowers veg oil import tax
* Argentine acres questioned

Wheat
* Wheat planting at 70% with 71% normally done
* Wheat emergence is 44%, average would be 47% 
* Buyers push back on high values
* Global stocks to remain tight
* Rains benefit US stands

Livestock
* Auctions attract few buyers
* Cash cattle trade steady from last week
* Slow slaughter not supporting boxed beef 
* Japan remains leading US importer
* High values limiting export demand


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning Comments; Friday, October 15th, 2021

Harvest continues to progress across the United States, and as it does, we are starting to see seasonal changes to the interior cash markets. Prior to harvest starting we were seeing sizable incentives for quick ship bushels, especially on corn for ethanol manufacturing. Even when harvest started many of these processors held their bids firm to encourage movement. One reason for this was to capture current margins, but also to encourage movement as the US farmer has shown more interest in marketing soybeans than corn. Now that harvest is progressing, we are seeing corn basis values relax as movement has increased. Movement on a whole is still slower than usual, which is keeping basis values historically firm at this time of the marketing year. Soybean movement has been higher as farmers see more potential for a corn rally than for that crop. Farmers can also move less inventory and generate more revenue with soybeans which tends to increase sales as well. As harvest advances, we are starting to see a light increase in movement though, which is being taken as an indication of better yields and filling storage. Movement is high enough that the futures market now has enough carry to make the holding of inventory more lucrative.  

Highlights
* US barge availability is rising
* US export demand termed “routine” 
* PNW export capacity full into January 
* River logistics improve in SAM 
* Vessels still limited to 50% of capacity
* US yields remain better than expected
* Fertilizer values top 2008 records 
* Oats hit all-time highs; 2x year ago 
* US crude inventory +6.1 million barrels last week
* US ethanol production highest since late July

Corn
* EU corn rallies to contract highs
* EU will increase imports this year
* Input costs expected to trim global acres  
* Mexico to see record imports this year
* Ukraine export program full into December

Soybeans
* Harvest pressure to ease
* SAM exports continue to pressure US
* Brazil meal exports in Sep +33% year ago
* Oct Malaysian palm oil exports -16.1% from Sep
* NOPA crush today est 155.07 bbu

Wheat
* Further losses expected to Canadian crops
* Final crops likely under USDA estimates
* US wheat values in line with global market
* Tight global supplies ease GMO restrictions
* Black Sea expects frost this weekend

Livestock
* Cattle margins strained by high feed costs
* Hogs less affected
* Chinese pork imports remain light
* China has bought 30,000 mt pork for reserves 
* Hog slaughter highest in 7 months


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Thursday, October 14th, 2021

Now that we are past the monthly WASDE report, trade will be waiting for its next fresh round of fundamental information. Given the time of the marketing year we are at this is unlikely to come until the next set of supply and demand data that will be released in November. Until then trade will continue to monitor the US harvest activity and yield reports. We will also see more attention on South American weather and growing conditions. So far conditions in South America have been near perfect, especially in Brazil. Heavy rains have fallen in Brazil recently creating the best soil conditions in the past several years. This is giving the crops a good start to the growing season, something they did not have last year. This is already generating ideas we could see elevated production in Brazil this year. It is not out of the question farmers in Brazil could see additional acres as well, especially with favorable returns. The question in South America is the same as it is in the United States though and that is input availability. Fertilizer use is expected to increase 8% in Brazil this year that may only push yields higher. It is early in the South American growing season though, and plenty of time for issues to develop such as they did last year.  

Highlights
* US inflation continues to rise
* Consumer prices in Sep +5.4% from 2020
* Energy costs up 1.3%, food +0.9% 
* US ethanol margins near 50c/gallon
* Draft restrictions remain on US rivers
* Covid closures limit global trade
* All global trade reporting issues
* Currency rates promote SAM sales
* US farmland values rally
* Another favorable weekly ethanol report expected

Corn
* Interior basis firming
* Futures starting to push for acres
* Mexico accounts for 55% of US demand  
* US corn cheapest in global market
* Ethanol margins support processing

Soybeans
* Export basis firming
* Canola futures offering complex support
* Canadian canola reported as high in quality
* YTD exports a 6-year low
* Brazil projects higher exports

Wheat
* Milling quality values rally
* EU planting is underway
* EU exports +60% from last year
* Importers pass on US offers
* High Russian taxes support global market


Livestock
* Cash cattle range from $121 to $124
* High feed costs weigh on feeders
* Livestock liquidation has slowed
* Yearly cattle slaughter +3.3% 
* YTD hog slaughter -1%


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning Comments; Thursday, September 30th, 2021

The much-anticipated quarterly stocks data will finally be released today. This will cover the US inventories of corn, soybeans, and wheat as of September 1st. For corn and soybeans this will basically give us the old crop ending stocks for the 2020/21 marketing year. Trade estimates indicate we will see lower stocks than last year across the board. Corn stocks are forecast to be down 750 million bu, soybeans down 350 million bu, and wheat down 290 million bu from last year. Once this data is released trade will quickly turn its attention back to the US harvest and production data. Yields continue to be highly variable across the US which is not that surprising given the wide variance in growing season conditions. As harvest progresses, we are starting to see yields creep higher though which indicates we may not see a reduction to production in the October WASDE report such as some analysts are predicting. Even if we do see a lowering of the US crop sizes it may come at the end of harvest when more data can be collected. We will also see attention shift back to the progress being made at the US Gulf for exports. While volume is picking up, gulf exports are still well below the levels seen prior to Hurricane Ida.  


Highlights
* Much interest on US debt talks
* La Nina still forming, expected to be short-lived
* Gulf operations more active
* Overall US export business is slow
* US processing margins remain favorable
* Active planting reported in SAM 
* Fresh US news is sparse
* US ethanol production falls, stocks rise
* Energy values drive fertilizer costs
* Quarterly stocks report at 11:00 AM CT

Corn
* Average stocks estimate 1.17 bbu
* Sep 1st 2020 was 1.92 bbu
* Trade est too high in 6 of past 10 years
* US yields better than expected
* Ukraine yields disappointing 

Soybeans
* Sep 1st stocks est 174 mbu 
* Year ago stocks were 525 mbu
* Farm gate sales remain high
* US crush margins slip, still positive
* Global oilseed values to correct

Wheat
* Sep 1st stocks est 1.86 bbu
* Year ago stocks were 2.15 bbu 
* 2021 all wheat production est 1.68 bbu 
* August production est was 1.7 bbu
* Quality a major trade issue

Livestock
* Whole sales beef still weakening
* Slaughter numbers down
* Higher slaughter weights reported
* US hog litter size record high 
* High retail costs limiting demand   


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Wednesday, September 29th, 2021

Elevated positioning in today’s session is a given ahead of tomorrow’s reports, these being the quarterly stocks data from the USDA. Nearly all estimates are for smaller stocks than a year ago, the question being how much smaller. It is not out of the question we could see smaller inventories of corn, soybeans, and wheat, yet a neutral to bearish report if stocks are surprisingly high. Tomorrow also brings month and quarter end, as well as first notice day on the October contracts. While this first notice day is not an issue for grains or oilseeds, it can impact managed money positions on a whole. Given their larger role in market attitude and price discovery their positioning can have an impact on all commodities. Even with these factors, trade is still closely monitoring several other factors, including global weather, demand, and the return of export business to the US Gulf. When it comes to weather not only is it impacting crop development but logistics as well. Low water levels on US rivers have restricted movement recently just as the gulf is trying to reopen. These ongoing issues continue to limit import buyer demand and may until operations are fully functional.  

Highlights
* Global economy remains an influence
* Trade monitoring US debt talks
* China continues to restrict energy usage
* China now asking for halt in fertilizer production
* Global weather is less threatening
* Ukraine grain exports +14% from last year
* Higher weekly ethanol manufacturing expected
* Trade predicts higher commodity demand
* Quarterly stocks data tomorrow
* Month, quarter end positioning today

Corn
* Brazil corn +$30/mt vs US
* Brazil to exhaust exports by November
* Weak Chinese values pressure global market
* China projects 9 mmt fewer corn imports
* Ukraine production +39 mmt on the year

Soybeans
* Brazil Sep exports above estimates 
* Argentine crush pace slowing
* US export loadings slowest since 2008
* Chinese soy bookings -303 mbu from 2020
* Chinese crushers remain offline    

Wheat
* EU exports +43% on the year
* Russia may lower export quota 
* US yearly loadings -13.5% 
* China still importing Australian wheat
* Elevated US planting expected

Livestock
* China keeps buying domestic pork for reserves
* Hog futures $20 discount to cash
* Brazil beef values stabilize
* Cattle slaughter +3.5% from last year 
* Yearly hog slaughter -1.5%   


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Tuesday, September 28th, 2021

Now that we have a good start to the US harvest the question being asked is what is being done with new crop inventory. It appears the majority of the deliveries taking place are on bushels that were forward contracted. This is mostly on soybeans as it appears farmers across the US are more willing to store corn this year which has been expected. As a result, it is not uncommon to hear of sizable premiums being paid to encourage corn deliveries. In many cases this has put cash corn bids well above the futures market. These premiums are short lived however and not expected to last through the remainder of the harvest season. That said, it is unlikely we will see basis values weaken in the near future either given the low pipeline supply of corn and soybeans at the present time. A big impact on interior basis will be what the US sees for export demand and if we start to see bushels back up into delivery locations. This may not happen until next spring when the South American harvest and export program gets underway. Expect to see ongoing positioning for Thursday’s stocks reports today, along with squaring ahead of month and quarter end.

Highlights
* Energy outlooks turn bullish
* High energy values may impact input costs, acres
* Logistic issues continue to plague gulf
* PNW ports at full capacity
* Farmer movement remains lights
* Economists predict favorable ag outlook into 2023
* Rains slow Chinese harvest
* Widespread rains predicted for Brazil
* Brazil corn planting at 25%, soybeans just getting started
* Argentine corn is 10% planted

Corn
* Harvest at 18%, normal is 15%
* Crop rated 59% G/E
* US production only 200 mbu above demand
* Yields continue to vary
* Input costs become market factor

Soybeans
* Harvest at 16%, average is 13% 
* Soybeans rated 58% G/E
* US crush margins shrink 30%, still favorable
* High US oil bids reduce exports
* Farmers sell soybeans for cash needs  

Wheat
* Winter wheat 34% planted
* Emergence at 9% 
* Australia is trending drier
* Yields up 18% in Russia
* Siberian crop largest in 12 years

Livestock
* Pork cutout continues to soften
* Hog futures a discount to cash
* Russia reports ASF at major production facility
* Hog packer margins at $37/head 
* By-products add another $22/head  


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Monday, September 27th, 2021

It would not be surprising to see elevated position squaring in the first part of this week’s trade. Thursday of this week brings not only month end, but quarter end as well. This tends to elevate the activity from the managed money crowd as they shore up positions and take profits. We will also see elevated positioning for the quarterly stocks numbers that will be released on Thursday as well. These will be as of September 1st and give a clear indication of old crop ending stocks on corn and soybeans. Trade is fully expecting these to be lower than last year which is not surprising. What would catch trade by surprise would be inventories on the high side as they would indicate last year’s crops may have been underestimated. Given the fact harvest is underway we may need to see a sizable divergence from expectations for the stocks data to be a major market mover. Once the stocks numbers are released trade will quickly return its attention to actual harvest reports from the Corn Belt. Harvest is starting to move into the heart of the Corn Belt and now is when we will start to get better indications of actual production possibilities.  

Highlights
* Yields reports remain mixed
* US has no room for production losses
* Favorable conditions for Ukraine planting
* Food inflation a global concern
* Input availability, cost may impact acres
* Markets starting to see new crop acreage push
* US gasoline consumption +4% year ago
* Quarterly stocks report on Thursday
* Thursday also month, quarter end
* FND on October contracts on Thursday as well

Corn
* Heavy harvest this week
* Average US basis -16 Dec
* Analysts lower yield estimates
* Some data shows less US acreage
* EU lowers crop forecast

Soybeans
* Harvest to pick up this week
* Yields in line with USDA estimates
* Planting remains slow in Brazil
* Brazil plantings expected to rise 3.6% 
* Farmers sales on soybeans remain high  

Wheat
* Russia yields better than expected
* Russia puts crop at 75.6 mmt 
* USDA has Russian crop at 72.5 mmt
* Active US planting reported
* Elevated double cropping expected

Livestock
* Sep 1st cattle on feed 99% at 11.23 million
* August placements 102% at 2.1 million
* August marketings 100% at 1.89 million
* US hog herd on Sep 1st 75.35 million, -3.9% 
* Breeding hogs -2.25%, market hogs -4.1%  


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning Comments; Friday, September 24th, 2021

Now that harvest is underway, we are starting to see a seasonal shift in market focus from supply to demand. This happens every year when harvest gets underway, and the US supply line starts to refill with corn and soybeans. For the past several months trade has been worried over US soybean demand and if it would deplete reserves. While this was a legitimate concern, in recent weeks we have started to see a shift in attitude. Cumulative soybean sales this year are currently 35% under a year ago showing us that rationing has worked. The larger soybean crop out of Brazil has also diminished demand for US soybeans, especially into China. Brazil is currently selling soybeans for fall shipment which is further stressing our demand potential. Cancellation of existing soybean sales have happened recently which only amplifies worries over future soybean demand. Corn demand has been more favorable, but even that has softened in recent weeks. Cumulative corn bookings are up 30% from last year but have stalled after our initial wave of sales. This is giving trade the indication that corn demand may be front loaded and our yearly sales will be slow to build from here on out.  

Highlights
* Power mostly restored to New Orleans
* Gulf export capacity still only 50%
* Buyers starting to extend gulf coverage
* Weekend rains may benefit low US river levels
* Concerns voiced over high input costs
* Input availability also a worry
* Global basis values firming
* Chinese commodity demand not slowing
* Big jump in US harvest expected next week
* Yields staring to increase with harvest progress

Corn
* US corn loadings -70% from last year
* Sales up 10% from last year
* Logistics hinder US exports
* Brazil removes corn import tariff
* Buyers pushing to encourage movement

Soybeans
* SAM weather concern fading
* US export sales -35% from last year
* Chinese bookings -37% on the year
* Most US exports through PNW
* Harvest to advance next week  

Wheat
* Russian wheat rallies for 9 weeks
* Russian wheat tax at $70/mt 
* IGC lowers world production 1 mmt
* US exports 1% under last year
* Rains benefit Argentine crop

Livestock
* Sep 1st cattle on feed est 98% last year
* August placements est 99.0% year ago  
* August marketings at 100% last year
* US hog herd est -1.7% from last year
* Breeding hogs -1.1%, market hogs -1.8%


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Thursday, September 23rd, 2021

We are now one week away from month end which will bring us our next round of fresh fundamental news, that being the September quarterly stocks report. This will give us our corn, soybean, and wheat inventories as of September 1st, which in effect are the old crop ending stocks numbers for corn and soybeans. While this report does receive market attention the fact that harvest is already underway tends to distort the data. This is from the fact that inventories are already being replenished and the possibility of diminishing reserves has been avoided. The earlier start to harvest we have seen in recent years has made the September numbers less of a factor for old crop contracts. What the data does have an impact on is new crop. If we see smaller than expected old crop reserves, it is typically carried over into new crop and those numbers will be adjusted downward as well. Right now this is more of an issue for soybeans as stocks to use remains at a rationing level. In the September WASDE report that USDA did raise the new crop stocks to use to 4.2%, but this is still a level that would warrant price rationing. The corn stocks to use is up to 9.5%, and while less of a concern, will be closely monitored as well.  

Highlights
* US Gulf expected to be 85% operational soon
* Managed money crowd remains unsettled
* Black Sea grain values rally
* Markets continue to struggle with Covid issues
* Brazil reports lowest drought area in 3 years
* Larger yearly exports predicted than USDA shows
* Ethanol manufacturing down 1.2% last week
* Ethanol stocks increase for 1st time in 8 weeks
* One week from quarterly stocks data
* October options expire tomorrow

Corn
* US yield data remains heavily mixed
* Brazil corn planting 24% complete
* World corn use record high 
* Global basis firms
* Ukraine yields under trade estimates

Soybeans
* Weak soy oil pressures complex
* Malaysian Palm Oil stocks up 10% year ago
* Rationing may have been overdone
* China’s soybean demand remains high
* US yields in line with USDA estimates  

Wheat
* 37% of HRW area dry in past 60 days
* This percentage lowest in past 3 years 
* Ukraine wheat crop an all-time high
* Russian crop larger than expected
* Chinese 2021 imports largest in 20 years

Livestock
* Cattle packer margins at $782/head
* Packer margins up $453 from last year  
* Frozen beef supply -35 million pounds from year ago
* Frozen pork supply down 5 million pounds on the year
* COF, Hog inventory reports tomorrow


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning Comments; Wednesday, September 22nd, 2021

Volatility is starting to build in the US grain and soybean markets. This is mostly on the cash markets and not that uncommon for this time of the marketing year. In some regions of the interior market processors are paying substantial premiums to entice quick-ship deliveries. This is more of a case on corn, especially to ethanol manufacturers. One reason for this is to secure as much fall inventory as possible, but ethanol manufacturers also want to capture as much of current margins as possible. These incentives are also being reported in the soy market, although incentives are not as great as for corn. These basis pushes are starting to cause more of a separation in the market between cash bids and futures values. In regions where corn and soybeans are needed, we are seeing basis values rally to a point where cash values are above futures at times. Not only is this done to generate movement but also to prevent corn and soybeans from entering the export channel. To see this in years with tight stocks to use is not uncommon. While basis values may soften as harvest progresses, current demand outlooks indicate they may remain historically firm.

  

Highlights
* Weather favors US fieldwork
* Harvest to gain momentum
* Low water levels a concern on US rivers
* 60 vessels wait to load in US Gulf
* Global economic concerns build
* US Fed meeting today/tomorrow
* Concerns over dry conditions in US Plains
* Rains move through dry regions of Brazil
* Higher ethanol production expected in weekly report
* Further decline in ethanol stocks also predicted

Corn
* US sales +25% from year ago
* Buyers now passing on US offers
* China imports remain record large 
* Barge movement -84% since Ida
* 30% of US corn area in drought

Soybeans
* China reportedly has 25% of Oct needs to cover
* China continues to favor Brazil over US for needs
* Brazil Sep exports ahead of estimates
* Palm Oil under pressure
* 26% of US soy area in drought  

Wheat
* Export loadings -9% on the year
* China agrees to take lower quality wheat 
* 70% of French crop low-grade
* Ukraine wheat crop +33% year ago
* Russia raises crop estimate

Livestock
* Yearly beef exports +18% from 2020
* US pork exports -7% on the year
* China pork imports from US -75%  
* China filling reserves with domestic pork
* Retail meat costs remain record high


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.
 

Morning comments; Tuesday, September 21st, 2021

Even with harvest progressing across the United States we are hearing more discrepancies when it comes to yields and potential crop sizes. Several reports are coming in that the crops are not as good as thought, especially on corn. Some reports from across the harvested regions claim yields are up to 20 bushels per acre under average. Others claim yields are better than average though, with some regions claiming their corn yields will be the best ever. This division is likely to continue all harvest season given the wide range of growing conditions the crop was subjected to. The question with this scenario is always if the good areas will yield high enough to offset the losses in the poor areas. One factor to watch with corn is test weight as some field scouts claim this will be below average given late growing season heat and quick crop maturity. Given the low volume of the corn crop that has been harvested it is hard to accurately determine final crop size. We are seeing less division on soybeans as harvest has yet to advance very far on that crop. The general consensus on soybeans is that late season rains were more beneficial than for corn.  

Highlights
* US acreage debate starting to build
* Australia turning drier
* Argentine farmers increase sales
* US processing margins firming
* Gulf remains slow to open
* Global stocks to use forecasts remain tight
* Stalk quality becoming more of US concern
* Also seeing more worries on test weight
* Lack of empty barges impacting movement, exports
* Global economic issues to increase

Corn
* Crop is 57% mature
* Corn harvest 10% complete
* Countries again shopping for corn 
* Processors back off quick ship premiums
* Farmers not making fall sales

Soybeans
* 58% dropping leaves
* Harvest is 6% complete
* Brazil importing Argentine soy oil
* China to increase soy oil imports
* Farmers sales on soybeans remain high  

Wheat
* Winter wheat 21% planted, 3% emerged
* EU exports ahead of last year 
* EU may out-sell production
* France raises export forecast
* Ukraine harvest pressuring global market

Livestock
* China August beef imports 190,000 mt
* YTD Chinese beef imports at 1.52 mmt
* Chinese August pork imports 288,000 mt 
* August pork imports -21% from last year
* China continues to liquidate sows


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Friday, September 3rd, 2021

Harvest pressure is starting to build on the US commodity market. This is not uncommon as we approach the fall season, and more inventory becomes available. Even though harvest is not rolling in full momentum, we are already seeing basis values back off on both corn and soybeans. While still favorable, basis values are currently the weakest they have been in the past several months. While soybean harvest is just getting underway, buyers know now how much inventory they will have until have until activity increases. Processors are also more willing to slow or halt operations than pay a premium to try and entice old crop movement, especially in a market environment where farmers are unwilling sellers. The loss of exports through the US Gulf is also causing backups in the interior market to pressure basis. We have seen more selling in the new crop contracts on soybeans which is further tempering basis values. Given our projected demand and tight stocks forecasts a collapse in soybean basis is not expected. Corn basis is also becoming unsteady. This is partly from the approaching harvest, but also from uncertain demand. The US has potential for large exports this year, but trade wants confirmation before extending bids. We may see elevated activity during today’s trade session as the markets will be closed next Monday for the Labor Day holiday.  

Highlights
* Trade continues to survey Ida crop damage
* Infrastructure repairs from Ida are underway
* Nearly all export interest now on PNW
* Stimulus payment concerns impact consumer spending
* Increased double cropping in Brazil likely this year
* Trade questions US energy product demand
* Yearly US exports likely over-estimated
* US weather mostly favorable to start harvest
* Trade closed next Monday for Labor Day
* Elevated fund positioning today is likely

Corn
* Census July exports at 215 mbu
* So Africa predicts larger crop
* Brazil field scouts more optimistic on yields
* China to auction 142,000 mt today
* Import buyers turn to Argentina

Soybeans
* July Census exports at 35 mbu
* Trade expects more Chinese business
* Importers wait for market breaks
* US maturity at a fast level
* Global oilseed market is pressured  

Wheat
* July exports at 75 mbu
* Argentina wheat little affected by drought
* Russia pricing itself out of world market
* Seasonal tendencies support wheat futures
* US harvest winding down

Livestock
* Weekly beef sales +49% at 15,600 mt
* Weekly pork sales +39% at 33,500 mt
* July beef exports at 107 mt
* July pork exports at 182 mt
* Beef exports +16.7% year ago, pork exports -9%


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Tuesday, August 31st, 2021

The ratings of the US corn and soybean crops held steady last week, indicating recent rainfall may have been more beneficial that thought. The big question when it comes to crop ratings will be next week when we start to see how much damage might have been caused by Hurricane Ida. The initial reaction is that little damage took place, but given current stocks to use estimates, any loss may be excessive. We are starting to see a shift in the market that will also be noticeable in the next few weeks. One of these is the advancement of the US harvest season. Trade is anxiously awaiting yield reports from the heart of the Corn Belt where big crops are going to be needed to compensate for losses in other regions. We are also going to start seeing more interest on the planting that is taking place in South America. An estimated 5.5% of Brazil’s winter corn crop has already been seeded, slightly behind last year’s 8%. A large amount of corn needed to be replanted in Brazil last year though which put the crop behind the normal pace all growing season. Much of today’s session will again be spent analyzing damage from Hurricane Ida, both to crop and infrastructure. Final month end positioning will also be a factor.  

Highlights
* Ukraine grain exports +3% from last year
* Starting to see new crop acreage debate
* SAM weather becoming more of a factor
* US gulf ethanol stocks lowest in 5 years
* Trade wants to see more Chinese demand
* Countries lower biofuel blend rates
* US barge movement -56% from last year
* Buyers continue to surface on breaks
* 38% of US corn in drought conditions
* 32% of US soybeans in drought areas

Corn
* Corn rated 60% G/E
* 9% of crop is mature, 7% is average
* Buyers push for new crop coverage 
* High input costs a global worry
* Planting advancing in Brazil

Soybeans
* Crop is 56% G/E
* 9% has dropped leaves, normal is 7% 
* Flash sales continue
* Brazil expected to be exporting in January
* Census crush today est 165 mbu  

Wheat
* Spring wheat is 88% harvested
* Canadian harvest starting  
* Canadian crop not as small as thought
* Export taxes halt Russian sales
* US winter wheat planting will start soon

Livestock
* Very light cash cattle trade
* Yearly beef exports a record 600,000 mt
* Japan leading destination beef
* Yearly pork exports at 1.2 mmt
* China pork demand likely to rise


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation. 
 

Morning Comments; Monday, August 30th, 2021

The highlight of this week’s early trade will be positioning for month end. This is more of a case as the September contracts will go into delivery. Most spot contracts have already been rolled but we always have a few left that can generate wide price swings in futures. As August draws to a close and we transition into September we tend to see a shift in market attitude. For one we see more attention on the start of the US harvest. While harvest activity has been taking place for several weeks now, September is when it moves into more followed portions of the Corn Belt. We also start to see more interest on the September WASDE report as it is the first of the year to contain accurate field collected data. We will also start to see positioning for the September stocks report that will be released on the 30th of the month. Leading up to that trade will try and better determine what our actual old crop ending stocks will be. Export loadings have trailed the volume needed to reach our yearly projections, meaning old crop sales will be rolled to new crop delivery. While this happens every year, it always has a knee-jerk reaction.

Highlights
* Hurricane Ida hits US gulf over weekend
* Crop damage will be assessed all week
* Frost damage noted in Argentina
* Trade expects more Chinese buying
* US basis values continue to soften
* Loss reports in Canada build
* Ethanol margins remain positive
* La Nina worries build
* Dry start to SAM planting 
* FND on Sep contracts next Tuesday

Corn
* Privates put US yield at 176 bpa
* Mexico is primary US buyer
* Yearly exports may be underestimated 
* Chinese corn -4% last week
* Rating decline expected tonight

Soybeans
* US yield held at 50 bpa
* Palm Oil production to increase
* Chinese soy values -4% last week
* China crush only profitable on domestic inventory
* Ratings 1-2 points lower tonight  

Wheat
* World milling quality supply shrinking
* 7 mmt loss in Canada expected  
* STATS Canada production numbers this week
* Farmers storing wheat world-wide
* US harvest pressure lifting

Livestock
* Very light cash trade last week
* Boxed beef likely has topped
* Hog slaughter slips lower
* US pork supply 20% under 5-year average
* Retailers focused on post-Labor Day demand


RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.