Bryant Sanderson

Apr 16, 2021

Highlights

  • Equity futures are higher finding support off stronger global markets. The Dow closed over 34,000 for the first time ever yesterday.
  • China released their GDP showing it was at 18.3% above a year ago for Q1. That is less than the expected 19% growth. Month over month growth was 0.6%, slowing down from the 2.6% quarterly increase in Q4 of 2020.  
  • The Commerce Department will release data on March housing starts and building permits today. New home construction is expected to be 14% above February to 1.611 million after February was down 10.3%. Better weather and strong demand for new homes are the reasons for the recovery in housing starts.
  • At 7:02 am CT: Crude is up $0.12 at 63.58, DOW futures are up 63 points at 33,986, S&P futures up 8 points at 4,170.5, and the USD down 0.093 at 91.525. 

Corn

  • Overnight market is a few cents higher after a mixed day yesterday. No new highs were set overnight.
  • Farmer selling of old crop was noted yesterday as the nearby May futures breached the $6.00 level.
  • The 6 to 10 day forecast in southern Brazil has turned wetter. The US weather in the Corn Belt is expected to remain cool and dry for the next week with any rain events expected to amount to very little.
  • The Buenos Aires Grain Exchange out of Argentina raised their corn production estimate to 46 mmt, up from 45 mmt.
  • May/July is at a 13’2 inverse, May/Sept at 60’6 inverse and July/Sept at 47’6 inverse. Dec/March trades at a 6’6 carry.

Outlook: Higher, recovering from yesterday on the nearby contracts while the new crop December contract continues to trade firmly. 

Oilseeds      

  • Soybeans are higher overnight with the May seeing the biggest gain of around ten cents while soymeal and soyoil are higher as well.
  • Basis levels continue to firm as there isn’t much farmer selling happening as many farmers just flat out don’t have any soybeans left to sell.
  • Dalian domestic number 1 soybean price was up 18 cents overnight and their number 2 import soybean price was up 26 ¼ cents.
  • Malaysian palm oil July futures were higher again, up 126 ringgits to finish 162 ringgits higher for the week. The higher palm oil market has continued to provide support to our domestic soybean oil price.
  • May/July at a 7’4 cent inverse, May/August at 47’0 inverse. Nov/Jan at a 1’0 inverse.

Outlook: Higher, finding support from the soybean oil price as global edible oil prices remain firm.

Wheat

  • Wheat is modestly higher after trading lower most of the night. EU Matif wheat is down one euro/tonne.  
  • Widespread precipitation is expected today over much of the hard red winter wheat areas with heaviest amounts in southeast east Kansas.  
  • Russia’s plan to restrict foreign warships near Crimea is not to affect the Kerch Strait, a major trade route for grain.
  • French wheat ratings slightly lower following a hard-cold snap. An estimated 83% of the soft wheat were in good/excellent condition, down from 85% in the previous week.  
  • Mpls May/July sits at a 7’0 cent carry, KC May/July at a 7’2 cent carry, and CHI May/July at a 1’2 carry.

Outlook: Higher, finding strength from corn and dryness in North Dakota. The hard red winter wheat areas are getting a mix of snow and rain today.