Bryant Sanderson

Oct 13, 2021

 Highlights

  • Equity markets are higher this morning as the market is expecting to see September’s consumer inflation report this morning to show a rise of 0.3% or 5.3% annualized rate.
  • JPMorgan Chase released their Q3 earning’s this morning showing revenue at $30.44 billion vs. $29.8 billion expected with earnings at $3.74 per share vs. $3.00 expected.
  • At 7:05 a.m. central time, Dow futures are up 50 points at 34,310, and S&P futures up 9 at 4,350, and WTI crude is down $0.67 at $79.97.
  • The U.S. $$ is down 0.249 at 94.270, gold up 17.1 at 1,776.4, and silver up 0.421 at 22.935. 

Corn

  • Futures are lower overnight following yesterday’s larger than expected yield at 176.5 and ending stocks at 1.5 billion bushels by the USDA.
  • The December’21 futures contract has broken through yesterday’s low of $5.1925 overnight to $5.19 this morning but it is still above the 200-day moving average at $5.185.
  • The USDA also released the crop progress report yesterday showing the country at 41% harvested with Illinois at 55% harvested.  
  • Open interest was up 12,020 with Mar 22 up 10,800 and July 22 up 2,400.
  • Spreads: Z/H 9’2 carry, Z/K at 15’0 carry, and Z/N at 16’6 carry. 

Outlook: Lower trade following USDA’s report yesterday but running into technical support levels. 

Oilseeds      

  • Following yesterday’s bearish WASDE report showing yield at 51.5 and ending stocks at 320 million bushels, the soybean market is trading higher this morning getting support from the soybean oil futures trading over 2% higher.
  • Malaysian palm oil futures for December were up 166 ringgits overnight, breaking through the 5,000 ringgit/tonne price level for the first time as India cuts its import tax on vegetable oils to zero. This has perked up the waning soybean oil futures overnight and has given support to soybean futures.
  • Soybean harvest is now at 49% complete with Iowa at 56% complete and Minnesota at 83% complete vs. 46% average.
  • China’s soybean imports for September dropped 30% from last year due to poor domestic crush margins.
  • There was 1 soybean meal delivery and 18 soybean oil deliveries.
  • Open interest was up 26,770 with Jan 22 up 15,400 and March 22 up 4,400.
  • Spreads: X/F at 11’2 carry, X/H at 22’0 carry, X/K at 31’2 carry, and X/N at 38’2 carry. 

Outlook: Higher trade this morning supported by higher global edible oil futures but yesterday’s WASDE report is limiting gains. 

Wheat

  • Lower across the board with the KC wheat dropping five cents and Chicago wheat down three while the Minneapolis market is down a penny.
  • EU Matif wheat is down 2.50 euro to 269.00 euro/tonne.  
  • US all wheat stocks were down about as expected in yesterday’s WASDE report, but the world wheat stocks were down more than anticipated as Canada’s crop was cut by 2 mmt to 21 mmt.
  • Hard red winter wheat planting is at 60% complete, on par with the average rate.
  • Pakistan is thought to have received offers in their 90,000-tonne tender with the lowest believed to be $388.83/tonne c&f.
  • FranceAgriMer lowered its forecast of French wheat stocks for 2021/22 to 2.4 million tonnes, down from 2.9 million last month due to lower production.
  • Spreads: Mpls Z/H 11’0 inverse, KC Z/H at 8’4 carry, and Chi Z/H at 13’2 carry. 

Outlook: Lower, correcting from yesterday’s gains.