COMMENTARY 6/7/18

Nice scattered showers have started their trek across the W corn Belt.  Hope we get some here!  Coverage and expected amounts are increasing to 1.50” to 3.00” in the next 7!  Temps ARE warming and getting miserably muggy which IS good for creating storms.  The Delta and S Plains should stay dry.

CORN

DOWN 2

Good growing weather and bean futures took a toll. Funds were thought to have sold some 19k contracts.  Export Sales were mid-range at 33 vs expectations of 24-35 mill bu. Big buyers were Mexico and Vietnam. This month’s export demand has been the second best in the last 12 yrs!  Old crop shipments could end up being 75 mill MORE than the last USDA est.  The next USDA Wasde will be out Tues 6/12.  The Trade is expecting to see 17/18 c/o 18 mill bu lower at 2.164 in a range of 2.125-2.208.  The 18/19 c/o is thought to be 30 mill bu lower at 1.652 in a range of 1.425-1.851.  The SA crop est look for Argentina down ½ MMT to 32.5 in a range  of 31.0-33.0. Brazil 2.9 MMT lower at 84.1in a range of 78.4-87.0.

BEANS              

DOWN 20

BONZI!!  Funds selling and the Brazilian Real took a nose-dive!  Funds sold some 17k contracts today and the Real was down 3% on its’ low from uncertainty and unrest from Brazil elections (and a candidate who is in jail).  Export Sales were low, below the 7-18 mill bu expectations at just 6.1.  Our friends, China cancelled 1.4 million old crop and did not buy ANY new crop. Out old/new crop sales combined this past month avg’d about 15 per week.  This is BELOW the 5 yr avg of 19.  Both Meal and Oil sales were near the low end of expectations with meal at 131 K vs 50 -350 expected.  Oil was 10 K vs expectations of 5 – 25. Trade sees the pre-report 17/18 c/o dropping 6 mill to 524 in a range of 473-566 and 18/19 c/o increasing 25 mill at 440 in a 395-702 range.  The SA crop is expected to show Argentina dropping 1.2 MMT to 37.8 and Brazil growing by 0.3 MMT to 117.3.

WHEAT

UP 7

There ARE still concerns about the wheat in the Black Sea Region and paid NO attention to beans today. Due to dry weather, many are suggesting Russia’s crop could decline another 5 MMT below the USDA’s 72 MMT May est  and the Ukraine could be down 3-5 MMT.  Flash flood warnings are in effect OK City and Moore today. A big portion in Central OK received 1 – 2.5” of rain with some areas getting up to 3”.  For the upcoming Wasde, Bloomberg expects the 17/18 c/o to increase 9 mill to 1.079 bill bu (compares to the USDA last month at 1,070).  The 18/19 c/o are expected to be 2 mill higher at 957 in a 820-994 range.