Ag Prices Higher Across The Board

MORNING AG OUTLOOK

All green on the screen this AM as agricultural prices are higher across the board ahead of the weekly export sales data, delayed a day due to the Veteran’s Day Holiday.  CFTC-COT data is pushed back to Monday.  Market strength appears to be technically driven as market moving headlines are scarce.  Speculative traders were healthy sellers across the Ag. space yesterday driven by the US $$$ surging to a 19-month high and reports another round of tri-lateral peace talks between US, Ukraine and Russia is in the works.  Updated Brazilian production forecasts from Conab were uneventful.  Energy prices are little changed after yesterday’s recovery.  Spot WTI crude oil down $.15 per barrel at $88.60 while spot RBOB is down $.02 per gallon with HO up $.02.  A mix of rain and snow across the Great Lakes region and ECB the past 24 hours, otherwise dry across the nation’s midsection.  The WCB remains dry for another week which should enable harvest to wrap up in a timely manner.  Week 2 of the outlook has above normal precipitation across the Plains and WCB helping further ease drought conditions.  South American weather remains largely non-threatening.  Rain in Argentina will favor central and northern growing areas where it is most needed.  In Brazil heavier precipitation shifts into the WC and northern growing areas, also where it is most needed.  The US $$ is slightly higher while carving out a fresh 19-month high.  Producer prices are expected to have risen .4% in Oct-26 while up 6.6% YOY.  US stock indices are slightly higher.

Corn: 

Dec-26 is up $.04 ½ at $4.47, wiping out yesterday sell-off.  Speculative sold another 12k contracts yesterday taking the MM short position to nearly 30k contracts.  Open interest was up another 9.4k contracts despite heavy liquidation of the Dec-26 contract.  Conab kept their Brazilian production forecast unchanged at 148 mmt, vs. the USDA forecast of 141 mmt.  Export sales are expected to range from 75-115 mil. bu.  Ukraine’s Ag. Ministry reports their 26/27 exports as of Nov. 13^th at 2.42 mmt is down 5.5% YOY.

Soybeans:

Jan-27 beans are up $.16 at $12.35 with the overnight high stopping just shy of the November high at $12.37 ¾.  Next resistance is the 100-day MA at $12.53 ½.  Dec-26 meal is up $3 at $328.40 while Dec-26 oil is up 55 points at 63.97.  Crush margins are steady at $1.92 bu.  Increased attacks by Russia has forced Ukraine to suspend operations at 2 major sunflower oil processing plants causing further damage to their agricultural economy.  Conab held their Brazilian production forecast unchanged at 181.6 mmt, vs. the USDA est. of 186 mmt.  Exports are expected to range from 35-70 mil. bu. for soybeans, 250-450k tons of meal and 0-10k oil.  With the lower-than-expected US production and stocks there is little wiggle room for South American yields to come in below trend.  Brazilian planting are approaching 75% while just underway in Argentina, so a lot of growing season ahead.  Argentine planting updates are delayed due to holiday.  China purchases likely sitting around 20 mmt.  With the USDA raising US exports 25 mil. to 1.720 bil. bu. this week (46.8 mmt), leaves only 21.8 mmt to non-Chinese buyers, after China wraps up their 25 mmt purchases.  That would be down 25% from YA.

Wheat: 

Prices have surged back $.07-$.09 across the 3 classes.  Dec-26 CGO is up $.09 at $5.93, Dec-26 KC is $.07 higher at $6.29 while Dec-26 MIAX is up $.07 ½ at $6.30.  The market seems less confident a 2^nd round of tri-lateral peace talks will have any more impact than the 1^st round in reopening the Black Sea.  Ukraine’s wheat exports as of Nov. 13^th at 4.11 mmt are down 39% YOY.  Russian grain exports vis seaports in Oct-26 at only 2.8 mmt are off 56% vs. YA.  YTD shipments for the 26/27 MY at 9 mmt are down 54%.  Conab lowered their Brazilian production forecast .5 mmt to 5.26 mmt, vs. the USDA est. of 5.8 mmt.  Higher global stocks support the recent price selloff however continued supply disruptions from the Black Sea region may reverse that trend.  US wheat has become more competitive in the global marketplace.  Look for further easing of drought conditions across the US plains as the winter crop heads towards dormancy.  Export sales are expected to range from 12-24 mil. bu.

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