About The Author

Jack Scoville

Jack Scoville is an often quoted market analyst in the grain and soft commodities sectors. You will find his commentary throughout the Reuters, Wall Street Journal, Dow Jones, Bloomberg, and Barron's publications. Contact Mr. Scoville at (312) 264-4322

MORNING GRAINS COMMENTS
Jack Scoville

Wednesday, August 14, 2019

Price Futures Group, CBOT
Chicago, IL
(312) 264-4322
jscoville@pricegroup.com

JSL, SA de CV
San Salvador, El Salvador (503) 2260-7806 jslsadecv@comcast.net

JSL, SA
San José, Costa Rica (506) 2282-7024
jslsa@comcast.net

WHEAT
General Comments: Wheat markets were mixed to lower on follow through selling tied to higher than expected US production estimates from USDA and on demand concerns. Reports of weaker prices overseas kept HRW and HRS under some pressure, and Minneapolis was also lower on harvest progress. USDA showed higher Winter Wheat and Spring Wheat estimates and also higher than expected ending stocks estimates. The higher ending stocks estimates came despite increased demand estimates. The demand estimates are considered aggressive as US export sales have not really increased since the beginning of the new crop year. World ending stocks were slightly lower due to continued weakness in overseas production. The trade keeps hoping for better demand in the world market for US Wheat, but this has not yet shown up as US prices remain fairly high in the world market. Ideas are that feed demand for Winter Wheat has been strong in the Great Plains, but export demand has been harder to find. The weather remains dry in much of the Midwest and Great Plains, but some rains have been noted in the Northern Plains to slow harvest activity there. Trends are down on the daily charts.
Overnight News: The southern Great Plains should get scattered and light showers this week. Temperatures should be near to above normal. Northern areas should see scattered showers and storms. Temperatures should be near to above normal. The Canadian Prairies should see mostly dry weather. Temperatures should be near to above normal.
Chart Analysis: Trends in Chicago are down with objectives of 465, 460, and 436 September. Support is at 466, 455, and 451 September, with resistance at 479, 483, and 496 September. Trends in Kansas City are down with objectives of 383 and 354 September. Support is at 381, 378, and 375 September, with resistance at 393, 403, and 408 September. Trends in Minneapolis are down with objectives of 485, 464, and 407 September. Support is at 500, 497, and 494 September, and resistance is at 514, 516, and 519 September.

RICE
General Comments: Rice was a little lower yesterday. The charts show that prices held some support areas and the USDA reports on Monday were positive for prices. However, the harvest is active and some producers as well as some speculators sold yesterday. Long grains yield were less and provided a bullish backdrop for the trade. We have been hearing of lower yields in Texas and Louisiana and lower yields are expected in Arkansas and Mississippi once these states start to harvest. Yield reports from Louisiana seem especially low this year. Long grains production was down as was domestic consumption. Exports were left unchanged. Medium and short grains yields were also lower except for California which saw increases due to very good growing conditions. Futures closed higher and the daily charts show that the market is about to try to rally again with moves over 1200/cwt possible.
Overnight News: The Delta should get mostly dry conditions. Temperatures should be near to below normal.
Chart Analysis: Trends are mixed to up with objectives of 1182 and 1207 September. Support is at 1135, 1130, and 1127 September, with resistance at 1157, 1163, and 1172 September.

CORN AND OATS
General Comments: Corn was lower on follow through selling tied to the USDA reports that showed higher than expected production potential and less demand. USDA showed more acres planted to Corn than had been anticipated by the trade. It also raised its yield estimate from last month by 3.5 bushels to push production estimates well above the trade guesses. USDA trimmed ethanol and industrial demand and cut export demand. Ending stocks were well above trade estimates. Futures have seen significant fund and speculator selling in response to the reports and futures have now given back any weather related gains seen in the market since the start of the growing season. The crop remains very late and the production estimates made by USDA could be subject to significant revisions down depending on the weather through harvest. Prices can become more stable but there is no real reason to expect a major rally for now due to the production estimates. It is very possible that USDA has published their biggest production estimates for this crop year.
Overnight News:
Chart Analysis: Trends in Corn are down with no objectives. Support is at 366, 360, and 353 September, and resistance is at 379, 385, and 391 September. Trends in Oats are mixed to up with objectives of 295 September. Support is at 268, 265, and 261 September, and resistance is at 273, 276, and 278 September.

SOYBEANS AND PRODUCTS
General Comments: Soybeans and Soybean Meal were higher in response to news that the US and China had exchanged telephone calls in an effort to keep the trade talks going. There are hopes that China might start to buy again but there re real questions as to how many Soybeans they need to buy due to diminished feed demand there. The Asian Swine Flu is still hurting feed demand and causing reduced imports from all sources. Soybean Oil was lower. USDA left its yield estimates unchanged from the June reports and showed less planted and harvested area from June. Export demand was cut due to the lost Chinese market demand due in part to the trade wars and in part to less demand generally from China due to the effects of the Swine Flu. Domestic demand was unchanged. It is likely that USDA will make significant revisions in the Soybeans production estimates in the next few months.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed up with objectives of 896 September. Support is at 869, 863, and 861 September, and resistance is at 883, 887, and 896 September. Trends in Soybean Meal are mixed. Support is at 293.00, 291.00, and 287.00 September, and resistance is at 300.00, 303.00, and 305.00 September. Trends in Soybean Oil are mixed to up with objectives of 2960 September. Support is at 2890, 2880, and 2860 September, with resistance at 2980, 3000, and 3040 August.

CANOLA AND PALM OIL
General Comments: Canola was lower in sympathy with the weakness in Soybean Oil. Most areas are seeing good weather now, but the weather has been dry and sometimes hot in many growing areas until recently. Traders are expecting good but not great crops right now. Palm Oil was higher on positive export data. Buying also probably came as the China-US trade war is causing China to consider dropping quotas on world vegetable oils imports. The market still expects limited upside potential, but the charts show that the market has broken out to the upside. There are ideas that there is plenty of production and supply to meet any expected demand. Stocks in Indonesia have increased for four straight months.
Overnight News: SGS said that Malaysian Palm Oil exports are now 475,555 tons this month, from 366,242 tons last month.
Chart Analysis: Trends in Canola are mixed to up with objectives of 461.00 November. Support is at 448.00, 445.00, and 442.00 November, with resistance at 456.00, 457.00, and 459.00 November. Trends in Palm Oil are up with no objectives. Support is at 2200, 2170, and 2150 November, with resistance at 2250, 2260, and 2280 November.

Midwest Weather Forecast: Mostly dry after some showers today. Temperatures should be near to above normal.

US Gulf Cash Basis
Corn HRW SRW Soybeans Soybean Meal Soybean Oil
August +40 Sep +155 Sep +49 Sep +356Nov +12 Aug N/A
September +40 Sep +72 Sep +25 Nov
October +35 Dec +70 Dec +24 Nov
All basis levels are positive unless noted as negative

DJ ICE Canada Cash Grain Close – Aug 13
WINNIPEG — The following are the closing
cash canola prices from ICE Futures.
Source: ICE Futures
Price Change
CANOLA
*Par Region 423.40 dn 10.70
Basis: Thunder Bay 463.90 dn 3.50
Basis: Vancouver 468.90 dn 3.50
All prices in Canadian dollars per metric tonne.
*Quote for previous day
Source: Commodity News Service Canada
(news@marketsfarm.com, or 204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – August 14
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Wednesday, supplied by commodity broker Matthes & Porton Bhd.
Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.
Refined, bleached and deodorized palm oil, FOB, Malaysian ports
Offer Change Bid Change Traded
Aug 547.50 00.00 Unquoted – –
Sep 547.50 00.00 Unquoted – –
Oct/Nov/Dec 552.50 00.00 Unquoted – –
Jan/Feb/Mar 565.00 -02.50 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
Aug 552.50 00.00 Unquoted – –
Sep 552.50 00.00 Unquoted – –
Oct/Nov/Dec 557.50 00.00 Unquoted – –
Jan/Feb/Mar 570.00 -02.50 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Aug 542.50 +02.50 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Aug 420.00 +05.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Aug 2,170 +10.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Aug 156.00 +01.00 Unquoted – –
($1=MYR4.1855)

DJ China Dalian Grain Futures Closing Prices, Volume – Aug 14
Soybean No. 1
Turnover: 215,226 lots, or 7.38 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Sep-19 3,415 3,426 3,373 3,412 3,415 3,406 -9 114,714 63,368
Nov-19 3,464 3,465 3,435 3,437 3,451 3,443 -8 18 302
Jan-20 3,466 3,490 3,396 3,448 3,479 3,451 -28 95,848 116,650
Mar-20 – – – 3,439 3,439 3,439 0 0 30
May-20 3,616 3,624 3,556 3,598 3,614 3,593 -21 4,646 30,580
Jul-20 – – – 3,613 3,613 3,613 0 0 14
Corn
Turnover: 825,546 lots, or 15.75 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Sep-19 1,860 1,874 1,853 1,874 1,865 1,865 0 149,190 255,694
Nov-19 1,895 1,903 1,885 1,899 1,896 1,895 -1 43,022 341,308
Jan-20 1,914 1,918 1,902 1,914 1,912 1,911 -1 567,096 967,642
Mar-20 1,945 1,945 1,930 1,936 1,935 1,936 1 458 3,512
May-20 1,977 1,979 1,968 1,973 1,976 1,974 -2 65,702 199,144
Jul-20 1,992 1,993 1,984 1,984 1,987 1,989 2 78 1,158
Soymeal
Turnover: 4,155,790 lots, or 11.98 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Aug-19 – – – 2,788 2,788 2,788 0 0 0
Sep-19 2,945 2,950 2,830 2,891 2,935 2,886 -49 569,790 459,552
Nov-19 2,974 2,982 2,863 2,917 2,954 2,918 -36 159,562 237,652
Dec-19 2,956 2,962 2,850 2,907 2,953 2,911 -42 4,758 1,390
Jan-20 2,935 2,947 2,823 2,889 2,925 2,890 -35 3,130,608 1,714,872
Mar-20 2,866 2,880 2,776 2,828 2,868 2,813 -55 74 822
May-20 2,783 2,795 2,701 2,766 2,781 2,765 -16 290,746 363,034
Jul-20 2,785 2,788 2,721 2,766 2,784 2,760 -24 252 638
Palm Oil
Turnover: 785,622 lots, or 37.75 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Aug-19 – – – 4,270 4,270 4,270 0 0 0
Sep-19 4,750 4,750 4,606 4,676 4,680 4,674 -6 110,878 141,522
Oct-19 – – – 4,790 4,790 4,790 0 0 18
Nov-19 – – – 4,838 4,838 4,838 0 0 12
Dec-19 – – – 4,912 4,912 4,912 0 0 8
Jan-20 4,862 4,864 4,760 4,820 4,838 4,812 -26 630,754 466,010
Feb-20 4,940 4,940 4,940 4,940 4,848 4,940 92 2 20
Mar-20 5,036 5,036 4,898 4,920 5,102 4,942 -160 32 2
Apr-20 – – – 5,006 5,168 5,006 -162 0 2
May-20 5,036 5,048 4,976 5,020 5,030 5,008 -22 43,956 46,206
Jun-20 – – – 4,940 4,960 4,940 -20 0 2
Jul-20 – – – 5,000 5,020 5,000 -20 0 2
Soybean Oil
Turnover: 1,482,868 lots, or 90.47 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Aug-19 – – – 5,338 5,338 5,338 0 0 0
Sep-19 6,090 6,090 5,890 6,012 6,054 5,988 -66 174,674 174,160
Nov-19 6,130 6,130 5,990 6,076 6,118 6,048 -70 16 8
Dec-19 6,106 6,106 6,040 6,056 6,160 6,050 -110 30 38
Jan-20 6,190 6,200 6,024 6,144 6,166 6,114 -52 1,242,854 929,542
Mar-20 6,172 6,174 6,042 6,132 6,292 6,116 -176 44 6
May-20 6,222 6,228 6,100 6,178 6,200 6,154 -46 65,250 155,950
Jul-20 – – – 6,196 6,196 6,196 0 0 6
Notes:
1) Unit is Chinese yuan a metric ton;
2) Ch. is day’s settlement minus previous settlement;
3) Volume and open interest are in lots;
4) One lot is equivalent to 10 metric tons.

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Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures.
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