Ami Heesch

Jun 26, 2020

Ami L Heesch 

Highlights

Negative day in the markets from concerns of an economic slowdown with fears of a second round of the CoronaVirus before the end of the year. Some states  were said to have begun to real back on some of their re-opening status in an effort to contain the spread of the virus.  

  • Next week marks an end to another month and another quarter of the year.
  • The energy markets are mostly weaker with crude oil down 48 cents at 38.24.
  • The US$ is up 58 at 97.48, the gold market is up 13-14 bucks at 1776/ounce and the CD$ is down 0.0019 at 0.73075.
  • DJIA down 730 at 25015, S&P down 65 at 3005 and the NASDAQ down 259 at 9757.
  • StatsCan updated acreage report on Monday morning. USDA acreage and stocks reports out at 11 AM CDT on Tuesday.
  • First Notice Day for July futures is Tuesday with all long positions being reported after the close on the 29th.
  • Short trading week next week  for grains, with markets closed on Thursday evening and Friday in observance of the July 4th holiday. Trade resumes Sunday night at 7 PM CDT. 

Corn

Corn prices dipped lower again today on big crop ideas, month end/quarter end positioning and the USDA’s acreage and stocks data to be released on Tuesday at 11 AM CDT. Prices drew additional pressure from sharp losses in the wheat market and weakness in the energy and equity markets. 

  • Closes: July at $3.16 ¼, down 1 cent, September at $3.18 ¼, down 2 ¼ cents, December at $3.24, down 4 cents.
  • CIF premiums were 1 cent firmer for J/J and 2  cents firmer for August.
  • New contract lows were made from Dec 20 through July 21.
  • The USDA announced the sale of 204k tonnes of sorghum to unknown destinations (135k this year and 68k for next year).
  • Spreads: tightened with N/U at -1 ½ carry, N/Z 7 ¼ carry, U/Z 5 ¾ carry, N/Z 25 ¾ carry.

Oilseeds

The soy complex traded lower on spillover weakness in the energy and equity markets. Prices drew additional pressure from favorable weather condition for the US Midwest. Crop conditions are expected to show an improvement on Monday’s crop progress/ conditions report. 

  • Closes: July at $8.66, down 3 ¼ cents, August at $8.60 ½, down 6 cents, November at $8.61 ½, down 6 ¾ cents.  The products were weaker with meal down 3-4 bucks and oil down 20 points.
  • CIF premiums were mostly unchanged.
  • USDA announced the sale of 132k tonnes of beans to China for the 2020/21 marketing year.
  • The canola market traded lower on non-threatening weather across the Canadian Prairies and spillover weakness in the US soyoil market. Underlying support stemmed from a weaker CD$. The nearby contract closed down 2.10 at $470.  Alberta’s canola crop was rated 75% G/E.
  • Spreads: N/Q 5 ¼ inverse, N/X 4 ¼ inverse, Q/X 1 ¼ carry, X/F 2 ¾ carry, X/H ½ inverse, X/N 7 ½ carry.

Wheat

The wheat market fell apart on position squaring ahead of the weekend and next week’s acreage and stocks data. Plentiful global supplies of wheat and fund liquidation weighed on Chicago, increased harvest activity weighed on KC and forecasts for beneficial rains for the Northern Plains over the weekend and early next week pressured Mpls. 

  • July closes: Mpls at $4.98 ½, down 11 cents, Kc at $4.20, down 9 ¾ cents, Chicago at $4.73 ¾, down 13 cents.
  • New contract lows were hit across all three classes of wheat.
  • EU wheat prices traded lower in sympathy with the sharp decline in Chicago wheat.
  • Spreads: Mpls N/U snuck into a nickel midday and then rolled back out to a dime at the close, U/Z 14 ¼ carry.