Ami Heesch

Nov 20, 2020

 Highlights

  • The energy markets are stronger with crude oil up 26 cents at $42/barrel.
  • The grain markets are trading higher: corn 4-6 cents, beans 15-16 cents, meal 4-5 bucks, oil 27 points and wheat 1-3 cents, canola 5-7 bucks.
  • US$ slightly firmer at 92.32, gold up 4 bucks at 1865, CD$ is stronger at 0.76615.
  • DJAI down 28 at 29414 and the S&P down slightly at 3579.
  • Dec options expiry takes place at the close today. FND for Dec futures is Nov 30 with long positions being reported after the close on the 27th.
  • Shortened trade week next week with Ag markets closed on Wednesday evening and Thursday in observance of the Thanksgiving Day Holiday. Trade resumes Friday at 830 AM with a 12:15-12:30 close. 

Corn

  • The corn market traded higher overnight on spillover strength in the soy complex.
  • South Korea bought 268k tonnes of corn for May shipment at $241.99/tonne C&F..
  • China’s corn prices were down 2 cents overnight.
  • Brazil’s 1st crop nears 80% planted. This compares to 78% last week and 84% on average.
  • Spreads: Z/H 5 ½ carry. 

Outlook: higher values expected on demand, tightening stocks, spillover strength in the soy complex and SA weather

 

Oilseeds   

  • The soy complex bounced higher overnight with strength stemming from increased demand as China continues to rebuild their hog herds.
  • Argentina’s bean plantings were reportedly just shy of 29% complete. This compares to 31% last year. The crop was rated at 95% in good condition versus 64% last year.
  • Palm oil closed down 54 ringgit at 3,288 ringgit.
  • China’s soy complex: beans down 2-7 cents, meal 5-6 bucks higher, oil down 29 points, palm oil down 131.
  • Weather forecasts for Brazil and Argentina look unchanged.
  • Spreads: F/H 1 ¼ inverse. 

Outlook:  higher road on tight stocks, strong demand and dryness in SA 

 

Wheat

  • The wheat market was slightly higher overnight in sympathy with the corn and soy complex.
  • US winter wheat areas are expected to see beneficial moisture over the weekend and next week.
  • French wheat planting nears completion at 95%.
  • Thailand bought 60k tonnes of US wheat at $290-$295/tonne C&F for April shipment.
  • Argentine’s wheat harvest nears 20% complete, on par with last year and the 5-year average. 57% of the crop was reported to be in good condition.
  • Australian wheat production estimated at 32-34 mmt. This compares to ABARES and the USDA estimate at 28.5 mmt.
  • Spreads: Mpls Z/H Mpls Z/H 16 ½ carry, Kansas City Z/H 8 ¼ carry, Chicago Z/H 6 ¼ carry. 

Outlook:   higher trade on spillover strength in the corn and soybean markets