Market Commentary  02/22/18 3:36:39 PM Printer Friendly VersionPrinter Friendly Version

Thursday, February 22, 2018

CORN

Corn closed a penny higher in a 3 cent trading range today. Funds were buyers of 2,000 contracts at mid-day and hold an 8,000 contract short and so have almost liquidated a very sizeable short position. CH has touched $3.70 but do funds want to go long this market? SA production estimates at least for Argentina continue to fall with estimates in the 34-37 MMT range (USDA Feb 39 MMT.) Brazil still has roughly 60% of their second (and larger) corn crop to plant and would like to have it completed in February. Ample world stocks continue to act as a buffer against SA shortfalls. USDA Ag Forum today/tomorrow came out with 90 mln. acres planted to corn this morning – balance sheets tomorrow. General thought is ending stocks in 18/19 will be less than 17/18 but not tremendously so. Weekly ethanol report shows corn usage rebounding nicely to 110.4 mln. bu. from 105 mln. bu. last week while stocks declined 5.5 mln. gallons. Weekly corn export sales delayed until tomorrow morning and the trade expects very good sales: 1.0-1.5 MMT. A sale of 130 tmt to unknown destinations announced this morning.

BEANS

Soybeans closed 2 cents lower in a 10 cent trading range today. Funds were buyers of 3,000 contracts at mid-session and hold an estimated long position of 73,000 contracts. SBM and SBO took a breather today which was negative soybeans as meal has been driving beans higher due to Argentine SBM export storyline. Argentine production estimated in the 45-48 MMT range (USDA Feb 54 MMT.) Argentina a meal and oil exporter and losses there expected to improve U.S. SBM demand. Hanging over the market is Brazil production potential – which is still viewed as robust. Ag Forum lists U.S. bean acres at 90 mln. with balance sheets tomorrow. Trade expects larger carryout in 18/19 than 17/18. Weekly export sales tomorrow morning and expected at 600-900 tmt. Sales announcements this morning had 55 tmt for 17/18 and 55 tmt for 18/19 to unknown destinations.
Wheat managed to close 4 cents higher today with funds buying 4,000 contracts but still short 70,000 contracts. Weekly exports expected in the 250-500 tmt range. CIF SRW continues to firm, bid 72 offered 80 this afternoon.
 
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