Bryant Sanderson

Jul 20, 2021

Highlights

Equity markets rebounded from yesterday’s sharp loss but did not recover all the losses. Airline and cruise companies led the correction higher as American Airlines was 8% higher and Delta was 5% higher. Royal Caribbean was 8% higher. Energy markets jumped back higher as well.    

  • The Commerce Department showed housing starts rose 6.3% for June while May was revised down. Single-family starts were 6.3% higher and multi-family starts were up 6.2%. However, building permits for future home construction fell to an 8-month low.  
  • The $1.2 trillion bipartisan infrastructure deal is up in the air after Republicans questioned the funding for enforcement of existing tax laws to pay for the bill.
  • Dow Jones up 549 at 34,511, US$ up 0.075 at 92.975, and Crude Oil up $1.00 at $67.42.

                                                                                   

    Corn 

    The corn market was stronger throughout the day and finished a few cents off the highs. Concerns about dry and above normal temperatures in the western Corn Belt provided support to the market today.

  • The September/December spread jumped back up to a 5 ¾ inverse after getting as low as 2 ¼ yesterday.
  • AgRural out of Brazil esimates 30% of their safrinha corn crop has been harvested through July 15 vs. 43% last year.
  • Spreads: U/Z 5 ¾ cent inverse; and Z/H 7 cent carry; Z/N 10 ¼ cent carry.

     

    Oilseeds 

    Soybeans were stronger throughout the day but finished roughly 15 cents off the highs. The lows on the day were reached shortly after the noon hour but the market slowly climbed back higher into the close. 

  • It appears money was buying today, putting some weather premium into the market today after seeing outside influences yesterday causing a weaker finish.
  • Argentina has passed a law reducing its biodiesel blend mandate by half, essentially adding 500,000 metric tons of soybean oil a year to the global markets.
  • Spreads: Q/X 54 ¾ cent inverse; X/F 2 ½ cent carry; X/H 17 ¾ cent inverse.

     

    Wheat 

    Wheat finished mixed after trading higher for much of the day session. The Minneapolis market finished 7 cents weaker on the day while the KC wheat was the leader finishing 8 cents higher.   

  • There are continued rumors of the Chinese looking for US wheat, this time it is rumored to be the hard red winter wheat instead of the soft white winter that was rumored yesterday.
  • There were spotty showers over North Dakota and into Minnesota overnight. The weather across much of the spring wheat area still looks poor as dry and hot conditions are expected to persist. It appears the drop in futures is attributed to the failure to break through yesterday’s high, which is the contract high.
  • Spreads: Mpls U/Z 11 ½ cent inverse, Kansas City U/Z 10 ¾ carry, Chicago U/Z 8 cent carry.