Bryant Sanderson

Oct 11, 2021

 Highlights

  • Equity markets are lower this morning after the Dow gained 1.2% last week, the best performance since June.
  • Banks are closed today in observation of Columbus Day. The bond market is also closed.
  • WTI crude oil has made another new high this morning, breaking through the $82/barrel level and is the highest it’s been since October 2014.
  • USDA will release their October WASDE report tomorrow at 11:00am CT with ag markets quietly trading overnight in anticipation of the report.
  • At 7:10 a.m. central time, Dow futures are down 94 points at 34,532, and S&P futures down 20 at 4,362, and WTI crude is up $2.40 at $81.76
  • The U.S. $$ is up 0.111 at 94.190, gold down 2.0 at 1,754.3, and silver down 0.194 at 22.500.  

Corn

  • Futures see higher trade through the night session but the range for the night was around three cents across the strip.
  • The market is expecting US stocks to be slightly larger than the Sept WASDE report at 1.432 billion bushels with the yield to come in slightly lower than the 176.3 bushels/acre in Sept at 176.0 for this report.
  • Corn harvest is expected to be slowed this week as rains are expected midweek for much of the Corn Belt.
  • Open interest was up 4,220 with Dec 21 down 6,800 and March 22 up 10,200.
  • Spreads: Z/H 9’2 carry, Z/K at 14’2 carry, and Z/N at 15’4 carry. 

Outlook: Quiet trade in anticipation for tomorrow’s WASDE report. 

Oilseeds      

  • Soybeans are a couple cents higher this morning, off roughly six cents from the overnight highs.
  • Soybean stocks are expected to see a large jump in tomorrow’s WASDE report thanks to the Sept 30 Grain Stocks report showing old crop stocks well market expectations. New crop US stocks are expected to be 300 million bushels vs. 185 million in Sept with the yield a little higher at 51.1 bushels/acre vs. 50.6 in Sept.  
  • Soybean harvest is expected to slowdown midweek as most of the Corn Belt is expected to get rains.
  • Malaysian palm oil futures for December were down 11 ringgits overnight as the US soyoil futures are modestly higher this morning.
  • Open interest was up 3,780 with Nov 21 down 11,200, Jan 22 up 9,700, March 22 up 3,100, and Nov 22 up 2,200.
  • Spreads: X/F at 11’2 carry, X/H at 21’2 carry, X/K at 30’2 carry, and X/N at 35’2 carry. 

Outlook: Quiet trade with the world edible oil markets tame overnight and the WASDE report tomorrow. 

Wheat

  • Mixed start for the week with the winter wheat classes a few cents higher but the Minneapolis market struggling to trade higher overnight.
  • EU Matif wheat was higher overnight, up 1.50 euro to 270.50 euro/tonne.
  • US all wheat stocks are expected to drop to 576 million bushels from September’s 615 million bushels. World stocks are expected to be at 280.82 mmt vs. 283.22 in Sept.
  • World wheat values have continued to climb as tighter world supplies and Russia increasing their export tax have pushed prices up.
  • Spreads: Mpls Z/H 10’4 inverse, KC Z/H at 8’2 carry, and Chi Z/H at 13’0 carry. 

Outlook: Higher in the winter wheat classes as the Minneapolis market struggles to hold strength after making new life of contract highs last Friday.