Written Commentary
Ag Market View for July 26.24
July 26, 2024
SOYBEANS
The soybean complex was mixed with beans down $.02 – $.05, meal was $2 – $3 higher, while oil was down 120 – 140. Nov-23 soybean were able to hold above last week’s low at $12.56 ¾. Dec-23 bean oil plunged to its lowest level since late June, ignoring strength in the energy markets. Dec-23 oil also violated support at 55.00, the midpoint between the May low and July high. Export inspections and the weekly crop progress and condition reports are delayed until tomorrow in observance of Columbus Day. US harvest weather should remain favorable thru Wed. before heavy rains develop from northern NE and southern SD extending east to MI by next weekend. Amounts from 1.5-3.0” are likely, resulting in harvest delays which would include all of IA, southern MN, WI, northern IL, IN, and OH. No significant change to SA forecast with heavy rains in southern Brazil with only scattered showers in Argentina and WC Brazil in the next week to 10 days. Last week MM’s sold just over 25k contracts of soybeans, 18k contracts of meal, while buying just over 6k contracts of bean oil. In total, the MM long position in the soybean complex has been reduced to 87,370 contracts, a 4 month low. Brazil’s soybean plantings have reached 10%, in line with YA. Malaysia’s palm oil stocks are expected to have increased 12.5% in Sept to 2.38 mmt with production at 1.86 mmt, up 6% from Aug-23. The Malaysia’s Palm Oil Board’s monthly report is due out tomorrow.
CORN
Prices were $.03 – $.04 lower with Dec-23 holding support above its 50 day MA $4.86 ½. Corn failed to track energy prices higher following the weekend surprise attacks on Israel by Hamas. So far the US State Dept. has confirmed that at least 9 Americans have been killed in the violence. If it is determined that Iraq had helped Hamas in the planning or carrying out of the attacks it will likely lead to international sanctions. Iraq currently produces just over 3 mil. barrels of crude oil per day (approx. 4% global production) with roughly 2 mil. barrels being exported. Last week MM’s were net buyers of just over 9k contracts of corn, while index funds were net buyers of just over 8k contracts. AgRural est. Brazil’s 1st crop corn planting have reached 37%, up from 32% LW. Our 2023/24 demand forecast at 14.340 bil. bu. is down 50 mil. from the USDA Sept forecast as a result of lower exports. Our ending stock forecast at 2.165 bil. is down 56 mil. from the Sept-23 USDA est.
WHEAT
Prices were higher across all 3 classes today with Chicago up $.05 – $.07 , while KC and MGEX were both $.09 – $.12 higher. IKAR raised their Russian grain production forecast 1.2 mmt to 141.2 mmt, while also raising their export forecast .5 mmt to 64.5 mmt. They also est. their wheat export price for early Nov-23 delivery fell $5 last week to $230/mt FOB. SovEcon estimates that Russia exported 880k mt of grain last week, down from 1.22 mmt the previous week. The bulk of these exports, 850k mt, being wheat. Last week MM’s were net sellers of just over 2,400 contracts of CGO wheat and 7,400 contracts of KC wheat. The MM short position in KC wheat has swelled to nearly 24k contracts, the largest since Aug-20.
See more market commentary here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
