Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
NEAR-TERM MARKET FUNDAMENTALS: The lower dollar and higher crude oil markets helped to support the soybean complex overnight according to traders. However, one analyst pointed out that all other influences may well be overwhelmed by today’s all-important Planting Intentions Report. The consensus estimate for US soybean planted area is just over 79 1/2 million acres, although some trade estimates are in record territory at well over 80 million. Argentina’s Agriculture Secretariat estimated 2008/09 soybean production there at 37 to 39 million tonnes yesterday as compared with the USDA forecast at 43.00 million. This compares to 46.2 million last year. This report has been delayed in recent months, adding to the controversy over government policy there. Trade sources in Argentina report that grain flows are resuming after the end of last week’s strike by farmers. China’s Ministry of Agriculture reports that stem rot, a fungus affecting rapeseed is up nearly 50% versus last year to 1.43 million hectares. This year’s planted area is pegged at 7 million hectares. An active weather system is expected to bring showers and thunderstorms to the Midwest over the next 10 days with Delta seeing even more activity over the short term. This week’s export inspections were 23.453 million bushels versus 25.916 last week. This was in line with trade expectations. Total inspections to-date stand at 78.3% of the USDA’s projected total, right in line with a 5-year average of 78.2%. Inspections need to average just 11.3 million bushels each week to reach the USDA projection. South Korea bought 20,000 tonnes of non-GMO US soybeans today.
CASH NEWS AND TENDERS: South Korea bought 20,000 tonnes of non-GMO US soybeans today. Egypt is tendering for 25,000 tonnes of soy oil and 15,000 tonnes of sunflower oil.
WEATHER: Cooler temperatures and scattered showers are forecast in Argentina over the next few days. Somewhat drier weather is forecast for the period in Brazil. In the US, an active weather system is expected to bring showers and thunderstorms to the Midwest over the next 10 days with Delta seeing even more activity over the next few days.
TODAY’S GUIDANCE: Outside markets provided some support overnight, but this morning’s USDA Planting Intentions and Quarterly Stocks reports should overwhelm all other factors during the day session. Cash market sources report that fewer farmers have made planting decisions at this point than is normally the case, which could make today’s numbers a continued source of market debate as farmers continue to weigh their options.
TODAY’S MARKET IDEAS: The market has a habit of absorbing big surprises on USDA reports within one day, two at the most. Often, this is followed by a move in the opposite direction.
