All Members: Sunday

CBOT Called Mixed To Start April; Cold Central US Temps and Limited Early Seeding

Apr 1, 8:32 am | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 1 cent lower to 2 cents higher, corn steady to 1 cent higher with wheat 1 lower to 1 cent higher   

 ** Sunday Weather & Market Comment Discussion: Happy Easter! Opening week calls are mixed as the aftereffects of Thursday’s USDA report trade around the world. China’s Dalian Commodity Exchange traded huge volume of meal on Friday with 4.3 Mil lots changing hands and prices $1-3/MT higher than Chicago’s Thursday close. End users were short bought on spring and early summer meal needs and were active buyers. Chinese corn values did not follow meal and settled mixed. European and other world markets were closed for Easter.

  There were showers across Argentina on the long weekend, most totals were less than .6”  with 2 stations reporting totals over 1.00”.  The forecast offers better chances for Argy rain starting around April 7th and continuing in the 8-15 day period. Near normal rain falls across the winter corn areas of Brazil.

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 Friday’s CoT report showed that the managed money is; short 78,000 contracts of Chi wheat (up 22,000), long 117,000 corn (down 96,000), long 184,000 beans (down 11,000), short 36,000 soyoil (up 11,000) and long 102,000 meal (up 3,000).   

** Central US Weather Pattern Discussion: Rain/snow/cold occurred across the Central US on the long holiday weekend. Lows were in the single digits across the N Plains and the lower 20’s into W Kansas and the Northern Midwest.

  The major forecast models offer a progressive spring weather pattern with warming hinted at in the 11-15 day period. Limited spring planting will occur over the next 10-12 days with temps too cold and bouts of rain/snow expected into April 12th. 3 spring storm systems are expected over the next 14 days for the Midwest, but none of them appear to be far enough west to produce needed moisture for the drought stricken Western Plains. Each system looks capable of producing .25-1.00” across the Midwest with totals for the Mid-South less than what was indicated on Thursday. The first system is early this week, followed by a more southerly system next weekend, and new system for April 11-12th. Below to much below normal temps persist thru the 10-day forecast with some of the coldest temps in the 1st week of April. The GFS model hints at a warming trend beyond April 12th. The other models are less enthused about the drier/warmer trend. Our confidence this far out is low, but it’s something to monitor in coming forecasts. Until then, it’s a cold pattern with frequent rain.

** North American 10 Day Rainfall Forecast and 1-15 Day Temp Anomaly: 

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US temps

CBOT Called Mixed With Weather Supportive, But Focus On NASS Thursday

Mar 25, 9:45 am | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 1 cent higher to 2 cents lower, corn steady to 1 cent higher with wheat called 1-2 cents higher.  

** Sunday Weather & Market Comment Discussion: Opening week calls are mixed as the CBOT starts to acutely focus in on Thursday’s USDA March 1st Stocks and Seedings Intention report. The report is expected to be bearish soybeans with US March 1st soybean stocks and US Seeding Intentions to be record large. The grain data is being called supportive with US corn seeding to decline from last year with US wheat stocks well below last year. ARC notes that the CBOT is closed Friday for the Easter Holiday, and that a 3-day weekend, end of the month and quarter all loom. This calendar fact along with US trade tensions will likely hike CBOT market volatility this week.

  Friday’s CoT report showed that the managed money is; short 56,000 contracts of Chi wheat (up 20,000), long 213,000 corn (down 20,000), long 196,000 soybeans (down 13,000), short 25,000 soyoil (up 4,000), and long 99,000 contracts of meal (down 12,000).

** Central US Weather Pattern Discussion:  The North American EU model 10-day rainfall forecast is attached. Note that the forecast features more above normal rainfall for the Delta and the southern half of the Midwest. The cold and soaking rain will further delay Southern US corn seeding and limited rains are slated to fall on the drought areas of the Plains, adding further acute stress on HRW wheat. 

** EU Model 10 Day Precip Forecast: Plains Drought to Deepen While Delta/S Midwest Spring Seeding Slows:

North American Precip

** March 1-31 Percent of Normal Precip; the Plains Drought Deepens While the Midwest is Cold

US Percent of Normal.

Rain/snow occurred across the C and E Midwest on the weekend (.2-2.00″) and more of the same is expected in the week ahead. A new storm system will take aim on the Midwest from late Tuesday into Thursday with .4-2.00” of moisture expected. Some of the precip will fall as snow. A second storm system will take aim across the E Midwest in the opening days of April.

Below to much below normal temps persist thru the 2-week forecast with some of the coldest temps in the 1st week of April. Any spring seeding will be slow to start due to the ongoing cold/wet weather conditions.

** South American Weather Pattern Discussion: The US and EU weather models are in good agreement that limited rains will fall across Argentina in the next 10 days, deepening the drought and producing nearly complete losses for the 2nd corn/soy crops. The attached map and drawn drought area reflect just a few spits of moisture which along with warm temperatures will elevate worry for summer row crop yields and the new wheat crop soon to be seeded. High temps look to range from the 80’s to lower 90’s.

  The Brazilian forecast features ongoing above normal rainfall for the winter corn crop. There is no evidence of a withdrawal of the rainy season into mid-April. Safrinha corn is flourishing.

** EU Model 10 Day South American Rainfall Forecast; Drought to Deepen Across Argentina:

South American precip

** March 1-31 Rainfall Percent of Normal: 

South American Precip Dev

CBOT Called Weaker To Start on Improved Plains and Argentine Weather; Trump Trade Announcements Awaited

Mar 18, 2:41 pm | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 3-5 cents lower, corn 1-2 cents lower, with wheat called 1-2 cents lower.  

 ** Sunday Weather & Market Comment Discussion: Opening week calls are slightly lower on the growing net long CBOT fund position and the meaningful rain that fell in some of the key soy growing areas of Argentina this weekend. And the parched areas of the Central US Plains will also receive some needed moisture.

  The USDA March Stocks and Seeding Report looms in 10 trading sessions along with the end of the month and quarter. And Trump trade uncertainty prevails with rumors of new tariffs to be announced against China ($30-60 Bil) this week while steel/aluminum tariffs become active. The EU is rumored to be targeting US corn in a retaliatory response, but last year the US exported less than 30 Mil Bu of corn to the EU – just 1.3% of the US total.

  Friday’s CoT report showed that the managed money is; short 36,000 contracts of Chi wheat (up 3,000), long 233,000 corn (up 70,000), long 208,000 soybeans (up 24,000), short 21,000 soyoil (up 12,000), and long 111,000 contracts of meal (down 4,000). Funds were longer than expected in soymeal, corn, and soybeans. Funds are holding a record net long soy complex position of 274,000 contracts.

** Mar 16-18 Rainfall; Better than Expected Across Key Argy Soybean Area:

weekly Euro

** March 1-31st  Percent of Normal Rainfall; Drought Deepens

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** US Plains Weather Pattern Discussion: A storm system is expected to produce some lite to moderate moisture for the Plains early this week, the first good chance of precipitation in months. Some nice rains have already fallen across the Texas Panhandle and SW Oklahoma. The rains will spread north and east into Tuesday. Rainfall totals are estimated in a range of’ .2-1.00” with another chance of moisture next week, and again in the opening days of April.

** 10 Day EU Model  Precip Forecast for North America; 

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** 15 Day North American Temperature Anomaly:

US temps

** South American Weather Pattern Discussion: The US and EU weather models are in fair agreement with the EU model being wetter for Argentina and N Brazil over the next 10 days. Both models offer another chance of rain on Friday and the weekend, but rain totals/locations are still being sorted out. Based on the weekend rains and the EU correctness in getting it right, our forecast is based more on the EU model forecast. 

 A few additional lite showers are expected to fall across N Argentina in the next 12 hours before mostly dry weather returns for Monday thru Thursday. Shower chances will increase on Friday/Saturday with totals of .25-1.50” and a few locally heavier amounts. There additional rain in the 11-15 day forecast. Note that near to above normal rains will continue across much of Brazil favoring their winter corn crop.

** 10 Day EU Model South American Rainfall Forecast:

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CBOT Called MIxed to Slightly Lower on Charts/CoT

Mar 11, 9:19 am | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 1-3 cents lower, corn 1-2 cents lower, with wheat called 1 cent higher to 2 cents lower.  

 ** Sunday Weather & Market Comment Discussion: CBOT opening week calls are mixed to mostly lower on carry through chart based selling as funds are holding a record long position in the soy complex and some meaningful rains are slated to drop across E Argentina after March 16th. The rains are positioned slightly farther north than what was indicated on Friday, and will cover reduced amounts of W and S Argentina. However, the rains are still a week away and the models are trying to sort of the exact details of amounts and location.  Based on the weather trends so far, this growing season, we fear that the Argy rains will under-perform. RGDS is S Brazil will be favored.   

**Mar 1-23% of normal Rainfall;

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  Friday’s CoT report showed that the managed money is; short 32,000 contracts of Chi wheat (down 29,000), long 163,000 corn (up 104,000), long 184,000 soybeans (up 37,000), short 9,000 soyoil (flat), and long 115,000 contracts of meal (up 9,000). Funds were much longer than expected in soymeal, corn, and soybeans. The long KC wheat position of 21,000 contracts offsets the Chi short.

** US Plains Weather Pattern Discussion: Dryness is expected across the Western US Plains with mild temps for the next 10-12 days. There is a chance of a few showers over the eastern third of KS, OK and NE. High temps will range from the 50’s to the 70’s. Wheat has started the greening process and is in dire need of moisture over the next few weeks.    

** South American Weather Pattern Discussion: The US and EU weather models are in good agreement that a continued warm/dry weather pattern will persist across Argentina/S Brazil this week. The weekend was dry and crop stress continued unabated. High temps ranged from the mid 80’s to the mid 90’s.

  The forecast models argue that rains will start to fall in the March 16th forward timeframe as several strong cold fronts pull northward. The rains will start across Buenos Aires and shift slowly north producing .25-1.50”.

 However, as the attached map depicts, the best chance of rain will be across S Argentina and far S Brazil (RGDS) next week. This positioning is farther north than what was indicated on Friday. Some areas of C and W Argentina will be short changed, but there are additional showers indicated during the 11-15 day period. Near normal rain is forecast for Brazil with seasonal temperatures.  crush

CBOT Called Higher as Traders Debate Worsening Argentine Drought Against US Ag Trade Retaliation

Mar 4, 7:55 am | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 2-5 cents higher, corn 1-2 cents higher, with wheat 2-3 cents higher.  

 ** Sunday Weather & Market Comment Discussion: CBOT opening week calls are firm as the Argentine drought deepens with limited rains over the next 10 days. However, concern over Trump proposed tariffs on steel/aluminum is causing anxiety over potential US ag trade retaliation. A host of nations on the weekend offered to retaliate against the US steel tariffs including China, who mentioned US beef/crops on their targeted list. Moreover, the tariffs are going to make resolving NAFTA issues far more difficult with mid March meetings planned. Traders will have to balance declining South American crop potential against the potential that US ag could be caught in  rising global trade tensions.

**Jan 1-March 18 % of Normal Rainfall:

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  Friday’s CoT report showed that the managed money is; short 61,000 contracts of Chi wheat (down 6,000), long 59,000 corn (up 40,000), long 147,000 soybeans (up 48,000), short 9,000 soyoil (down 18,000), and long 106,000 contracts of meal (up 21,000). Funds are less long corn, but holding a record net long soymeal position.

** US Plains Weather Pattern Discussion: Dryness is expected across the Central US Plains with warming temps for the next 7-8 days. The EU model offers a hint of better rains across the eastern third of Kansas after March 12th. High temps will range from the 70’s to the mid 40’s. 

** 15 Day North American Rainfall Anomaly: C & S Plains Remain Parched!

15 day US rainfall

 

** South American Weather Pattern Discussion: The US and EU weather models are in agreement that a continued warm/dry weather pattern will persist across Argentina. There is no evidence of a pattern change which would offer improved rains to stabilize crop yields into March 14th. The attached graphic is the EU weather model’s forecast for rains over the next 10 days. We have circled the crop areas of Argentina that look to be in a dry trend. ARC notes that the GFS model offered a chance of .5-2.00” of Argy rain in the 11-15 day period. This rain is not confirmed by the EU or GFS Ensemble Models and our confidence in such rain is low. High temps look to range from the 80’s to mid 90’s. Note that RDGS in Southern Brazil will be included in the above arid forecast.  

  Near to above normal rain will continue across N and C Brazil. The rains will slow the 1st crop harvest and the pace of winter corn seeding. Brazil’s CONAB will be out with updated crop estimates this week. The USDA March Crop Report is released on Thursday.

** 10 Day EU Model Projected Rainfall for South America: Dry Across Argentina!

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** Near to Above Normal Argentine Temps on Dry Soils:

1-15 day South American temps

Argentine Drought About To Become Historic? CBOT Called Higher on Crop Loss

Feb 25, 7:26 am | Sunday Commentary

** AgResource Pre Opening Sunday Market Calls: Soybeans 4-9 cents higher, corn 1-3 cents higher, with wheat 2-4 cents higher.  

 ** Sunday Weather & Market Comment Discussion: CBOT opening week calls are  higher as the Argentine drought looks to become historic! February rains across the major grain areas of Argentina look will be no more than just over 1.52” — the lowest in 38 years. And the forecast offers limited rain into  mid March. The loss of crop potential is rising dramatically and trader chants for a 40-42 MMTs soybean and a 31-33 MMTs corn crop will be noticeable this week. Such crops argue for expanded US export demand as world end users become more aggressive in their purchase pace. A run to new CBOT rally highs is expected in both corn and soybean futures as this drought now exceeds the 2008/09 episode.

 **Feb 1-March 11 % of normal Rainfall:

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Friday’s CoT report showed that the managed money is; short 67,000 contracts of Chi wheat (up 10,000), long 19,000 corn (up 29,000), long 99,000 soybeans (up 56,000), short 27,000 soyoil (up 13,000), and long 85,000 contracts of meal (up 14,000). ARC looks for funds to push to a record long soybean position.

** US Plains Weather Pattern Discussion: Dryness is expected across the Central US Plains with warming temperatures for the next 2 weeks. High temps will be mild with highs ranging from the 40’s to 70’s thru next weekend. There is no meaningful W Plains rain foreseen into March 10th.

** South American Weather Pattern Discussion: The US and EU weather models are in strong agreement that a continued warm/dry weather pattern will persist across Argentina for another 10-14 days. There is no evidence of a pattern change which would offer improved rains to stabilize crop yields. The attached graphic is the EU weather model’s forecast for rains over the next 10 days. We have circled the crop areas of Argentina that look to be in a dry trend into March 10th. In fact, the major weather models maintain parched Argentine weather with periods of heat. High temps look to range from the mid 80’s with a few days of lower 100’s possible mid and late in the forecast. Note that far southern Brazil will be included in this arid weather and warm pattern.

  Above normal rains will continue across N and C Brazil as the seasonal trends start to diminish rainfall chances in several weeks. The harvest and the seeding of the winter corn crop will continue to struggle this week.

** EU Model 10 Day Rainfall Forecast: 

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Some Rain on Long Weekend; Argentine Forecast Parched into March

Feb 19, 6:28 am | Sunday Commentary

** AgResource Pre Opening Monday Market Calls: Soybeans 6-15 cents higher, corn 1-3 cents higher, with wheat steady to 2-4 cents higher.  

 ** Monday Weather & Market Comment Discussion: CBOT opening week calls are sharply higher on the acute Argentine drought amid the ongoing dryness across the Western US Plains. There were weekend rains across Argentina with the best  totals falling in far Northern Santa Fe and S/E Buenos Aires where amounts ranged from .3-3.00”. Other areas were missed. The coverage of this rain is estimated at 20-23% of the crop area. The attached map reflects rainfall percentages for the month of February (including the 9-day forecast).

  Argentina is facing its driest February in decades with the shaded area reflecting key crop areas have seen just 15-55% of normal rain. This follows months of below normal rainfall.

  **Feb 1-28 % of normal Rainfall:

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Friday’s CoT report showed that the managed money is; short 57,000 contracts of Chi wheat (down 26,000), short 11,000 corn (down 82,000), long 43,000 soybeans (up 53,000), short 14,000 soyoil (up 13,000), and long 71,000 contracts of meal (up 19,000).

** US Plains Weather Pattern Discussion: Rains are slated to fall across the E Plains with totals of .1-1.50” with the best coverage across E Texas and E Oklahoma. The C and E Midwest will get soaked with rainfall of .5-3.75”.  Unfortunately, the HRW wheat areas of the W and N Plains will be missed.

  High temps will be warm with highs ranging from the 40’s to 70’s thru the weekend. There is no meaningful W Plains rain foreseen into March 6th.

** South American Weather Pattern Discussion: The US and EU weather models are in strong agreement that a continued warm/dry weather pattern will persist across Argentina for another 10-14 days. There is no evidence of a pattern change which would offer improved rains to stabilize crop yields. Also, moderate to heavy rains are forecast to fall across N and C Brazil which will continue to slow their soy harvest/winter corn seeding campaign. The attached graphic is the EU weather model’s forecast for rains over the next 10 days. We have circled the crop areas of Argentina that look to be in a dry trend into the opening days of March. In fact, all of the major weather models maintain parched Argentine weather into Mar 6th.

  Temperatures this week will be warm to hot with highs ranging from the  upper 80’s to lower 100’s across Argentina and the 80’s to lower 90’s across Brazil.

** EU Model 10 Day Rainfall Forecast: 

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weekend precip