Bryant Sanderson

Jun 9, 2021

Highlights

  • US Senate passed a $250 billion bipartisan tech and manufacturing bill yesterday to remain competitive with China as one of the world’s technological leaders.
  • The consumer price index is out tomorrow with expectations for a rise of 4.7% from a year prior. April’s 4.2% on an annual basis was the fastest rise since 2008.
  • China’s National Bureau of Statistics said their producer price index rose 9% in May from a year ago due to rising commodity prices. That is the highest rise since September 2008.
  • As of 6:45 AM: Crude oil up 0.31 to 70.36, Dow futures down 33 at 34,553, S&P 500 futures up 3.00 at 4228.75, and the U.S. $ index down 0.081 at 89.995. 

Corn

  • Corn is lower overnight with the December contract leading the way. Forecasts still show dry conditions for the western Corn Belt, but corn has been lower since the start of the overnight session.
  • WASDE report is out tomorrow at 11am CT with old crop stocks expected to be 1.207 billion bushels vs. 1.257 billion in May. New crop stocks are expected to come in at 1.423 billion bushels vs. 1.507 in May.  
  • The market is expecting the USDA to revise their Brazilian production lower tomorrow on the WASDE report from 102 mmt in May to 97.32 mmt as dry weather has impacted their yields.
  • Open interest was up 3,930 with N down 27,000, U up 20,500 and Z up 4,200.
  • Spreads: N/U 56’0 inverse, N/Z 76’6 inverse, U/Z 20’6 inverse, Z/H 5’6 carry. 

Outlook: Lower, led by the new crop contract. WASDE report comes out tomorrow. 

Oilseeds      

  • Soybeans are lower overnight with the new crop contracts down more than the nearby.
  • USDA’s WASDE report tomorrow is expected to show old crop stocks at 122 million bushels vs. 120 million in May. New crop stocks are expected to be 146 million vs. 140 million in May.
  • There have been rains in North Dakota this week with another chance on Friday but much of the western Corn Belt has been dry and is expected to stay dry. Basis values have dropped substantially from mid-May.  
  • Malaysian palm oil futures were down 178 ringgits overnight to 3871 ringgits and is weighing on the soybean oil futures this morning.
  • Open interest was down 880 with N down 12,000 and X up 7,800.
  • Spreads: N/Q 42’2 inverse, N/X 127’4 inverse Q/X 85’2 inverse, X/F 1’0 carry. 

Outlook: Lower, led by the new crop contract and soybean oil pressured by lower palm oil. 

Wheat

  • Lower across the board led by the Minneapolis market being 20 cents lower. Matif wheat was 2.00 euro/tonne lower to 214.25 euro/tonne overnight.
  • Rains are falling across parts of North Dakota, South Dakota, and Canada this morning with another chance of rain Friday for a large part of North Dakota. The Minneapolis market is seeing rain in the short-term forecasts, but rainfall totals are going to be key because the extended forecasts call for dry conditions to return.
  • WASDE report tomorrow is expected to show old crop stocks at 869 million bushels vs. 872 million in May. New crop stocks are expected to be 783 million bushels vs. 774 million in May. Hard red winter production is expected to be 760 million bushels vs. 731 million in May.
  • Mpls N/U 5’0 carry, Kansas City N/U 8’0 carry, Chicago N/U 6’0 carry. 

Outlook: Lower with the Minneapolis market leading the way and feeling pressure from the corn market.