COMMENTARY 3/27/18

Yesterday Funds were just light sellers of commodities.  Their overall positions are long 250k yc, long 194k ysb, and long 29k srw contracts.

CORN

UNCHANGED

Mixed. The Stocks and Planting Report is Thursday at 11 AM.  The avg acres guesti-mate is 89.4 in a 87.6-91.0.  Stocks are thought to be 8.703 bill in a 8.550-8.881 range.  Until the report comes out we’ll likely chop in the same 370-380 range.  Freight is still firm with the current rains affecting the rivers.  Demand for US bu’s is good today but our un-shipped sales are still at a record high of 926 mill vs 747 mill in2013.  Argentina’s crop is rated 75% poor/very poor and still just 18% harvested.  Brazil’s earliest safrinha corn should be starting to pollinate next week and will hit the market late Jul-ish.  With the passage of the omnibus spending bill, the 199A “Grain Glitch” was approved by Senate and signed by Pres Trump on Fri.  Producers can retroactively sell grain to private companies without a 20% reward to cooperatives.  THANKS for your support and positive attitudes as our elected officials sorted through the discourse!  

Bloomberg Trader Bias:  Bullish, 44% TW (33% LW), Bearish 17% (22% LW), Neutral 39% (44% LW)

 

BEANS              

DOWN 6

Technical selling and profit taking.  Fears over the potential China trade war are beginning to fade and also felt pressure from an increase in Agroconsult’s Brazil est to 118.9 MMT, up from 117.5.  That’s record big.  The USDA’s est is at 113 and Informa at 116.  As recently mentioned and again pointed out at the top of this page, specs have collected a rather large long position in the past several months. The USDA report coming ahead of a three day weekend COULD be setting up for something significant especially since we’re creeping up on the end of the month and that does sometimes have an influence on the size of exposure they have going into a new month.  Stocks are expected to be 2.030 bill bu, according to both Reuters and Bloomberg in a 1.81 – 2.11 range and compares to last year’s 1.739.  Planted acres are seen by Reuters to be 91.06 and Bloomberg at 90.9 mill in a 89.9-92.1 range.

Bloomberg Trader Bias:  Bullish, 18% TW (10% LW); Bearish, 35% (53%)); Neutral, 47% (37%)

Wheat

DOWN 5

Weaker as TX, OK, and KS get much needed accum with more possible in the forecast.  There ARE still the driest areas that are still very dry, however.  Yesterday’s Crop Conditions did improve with the recent rains.  G/E for KS  was up 2 at 13% but compares to a normal G/E of 38%.  OK was 9%, up 4% and 40% Normal,  CO 39% this week, up 8% from last week and 47% Normal, TX 12% up 2% from last week and 37% Normal, NE 51% G/E up 8% from last week vs 48% normally.  Acres on Thurs are expected to be 46.5 in a 46 -47 range and compares to 46 last year.  Stocks as of Mar 1st look to be 1.493-ish in a 1.45 – 1.64 range and compares to 1.659 last year.

Bloomberg Trader Bias:  Bullish 17% TW (16% LW), Bearish 35% (26% LW), Neutral 47% (58% LW)