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

Thursday, February 27, 2020

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

DJ U.S. Export Sales: Weekly Sales Totals – Feb 27
For the week ended Feb 20, in thousand metric tons, except cotton in
thousand running bales. Net changes in commitments are gross sales,
less cancellations, buy-backs and other downward adjustments. Total
commitments are total export shipments plus total sales.
The marketing year for wheat and barley began Jun 1, cotton and
and rice Aug 1, corn, soybeans and sorghum Sep 1, and soy meal and
soy oil Oct 1. Source: USDA
wk’s net chg total
in commitments undlvd sales
this yr next yr this yr last yr this yr next yr
wheat 381.8 68.1 22636.9 21960.0 5018.8 399.1
hrw 111.1 0.0 8446.3 7518.1 1859.7 87.1
srw 19.4 1.5 2237.8 2896.2 363.6 58.2
hrs 201.0 16.6 6588.3 6202.5 1537.0 122.0
white 50.3 0.0 4536.3 4866.2 1110.1 20.9
durum 0.0 50.0 828.2 477.0 148.4 111.0
corn 864.6 113.6 25873.2 39555.9 12377.3 1373.6
soybeans 339.3 22.1 33720.3 38883.0 4782.8 342.0
soy meal 157.5 8.6 7842.5 8492.0 3443.3 95.8
soy oil 5.6 0.0 689.0 508.7 238.1 0.5
upland cotto 214.6 198.9 13647.4 11941.4 7080.1 1482.9
Pima cotton 28.1 0.0 478.1 518.7 237.0 35.3
sorghum 444.5 0.0 1667.2 742.8 690.5 33.0
barley 0.3 0.5 49.2 58.2 15.5 31.0
rice 52.3 0.0 2687.1 2323.7 809.0 0.0

WHEAT:
General Comments: Wheat markets were mixed to lower on weaker world prices for Wheat. Russia has been lowering its prices in an effort to stimulate sales. East and West Europe have weaker prices as well. The competition for sales is strong as seen in the Russian and European pricing and this is what has hurt the futures prices recently. The super strong US Dollar just adds to the difficulty US producers and exporters have with sales of US Wheat into the world market.
Overnight News: The southern Great Plains should get mostly dry conditions. Temperatures should average near to below normal. Northern areas should see mostly dry conditions except for some light snow tomorrow. Temperatures will average near to below normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average near to below normal today, then above normal by the end of the week.
Chart Analysis: Trends in Chicago are down with objectives of 529, 513, and 498 March. Support is at 530, 528, and 523 March, with resistance at 542, 553, and 558 March. Trends in Kansas City are down with no objectives. Support is at 448, 444, and 435 March, with resistance at 459, 463, and 469 March. Trends in Minneapolis are down with no objectives. Support is at 512, 508, and 506 March, and resistance is at 520, 525, and 530 March.

RICE
General Comments: Rice was a little higher in narrow range trading. Rice felt less effect from news of the spread of the Coronavirus because the countries it has spread to do not really buy a lot of US Long Grain. Some producers are selling the next crop and the trade and open interest in the September contract is relatively large for the time of year. More selling from producers of the next crop is expected on any further rally attempts. Demand for US Rice remains generally positive and the export sales pace in general has been very good. The US domestic market is now quiet with the harvest mostly done and no one real interested in selling. Mills and exporters are thought to be covered for now but will need to step into the market to buy again soon.
Overnight News: The Delta should get showers and rains through early this week. Temperatures should be near to above normal today, then near to below normal.
Chart Analysis: Trends are mixed. Support is at 1326, 1324, and 1316 March, with resistance at 1347, 1352, and 1357 March.

CORN AND OATS
General Comments: Corn was a little lower and Oats were lower in response to the spread of the Coronavirus and the weakness in Wheat. There was not much new reported during the session yesterday, but CDC did comment after the close that the virus is coming to the US and that Americans should take precautions. It is reported in South Korea, Italy, and Iran this week. The spread of the virus has created increased fears of a meltdown in the global economy and therefore less demand for feed grains. Export demand has been disappointing, but it was solid last week, and ethanol and other industrial demand has started to improve but faces an uncertain road ahead. Export demand remains an open question despite the big sales in the last few weeks and the trade deals consummated in the last couple of weeks with Canada, Mexico, and China. The strength in the US Dollar hurts demand for US Wheat with South America now starting to offer at lower prices. The weaker Wheat prices means more of that commodity can be used as feed as well. Much of the improved ethanol demand will be seen if and when China starts to buy. US feed demand is improved.
Overnight News:
Chart Analysis: Trends in Corn are down with objectives of 368, 350, and 344 March. Support is at 368, 365, and 362 March, and resistance is at 376, 380, and 383 March. Trends in Oats are down with objectives of 270 March. Support is at 277, 274, and 271 March, and resistance is at 286, 290, and 294 March.

SOYBEANS AND PRODUCTS
General Comments: Soybeans and Soybean Meal closed a little higher due to the imposition of a 3% export tax by the government of Argentina on all Ag market exports. Traders naturally thought of Soybeans and products with the move, although Corn and Wheat sales are included as well. The Coronavirus is on its way to becoming a [pandemic with its recent spread outside of China. It had spread to South Korea, Italy, and Iran this week. The number of new cases reported inside China continues to drop. The spread of the virus brought more fears about the health of the world economic scene. It seems like everyone is waiting for China to buy in quantity. China has not yet asked for a modification of the terms due to the Coronavirus outbreak currently decimating the south central area of the country. There are hopes that China will start to buy in earnest from the US starting very soon. A lot will depend on the price of US Soybeans and those from Brazil and Argentina. Lower prices there will hurt overall demand here, and lower prices are very possible in Brazil. Brazil is harvesting now and yield reports from the field indicate that a bumper crop is coming. Argentina has been dry but is now getting some very timely rains. A super strong US Dollar has hurt US export chances in all products.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 861 and 854 March. Support is at 871, 869, and 866 March, and resistance is at 888, 891, and 898 March. Trends in Soybean Meal are mixed Support is at 288.00, 285.00, and 283.00 March, and resistance is at 294.00, 295.00, and 296.00 March. Trends in Soybean Oil are down with objectives of 2870 March. Support is at 2890, 2870, and 2840 March, with resistance at 2960, 32980, and 3000 March.

CANOLA AND PALM OIL
General Comments: Canola was a little higher in consolidation trading. Strength in Soybeans help Canola while lower Soybean Oil and Palm Oil prices did not help at all. New reports that the Coronavirus had spread to South Korea, Italy, and Iran over the weekend, but the news was mostly silent during the session yesterday. The number of new cases reported inside China continues to drop. The spread of the virus brought more fears about the health of the world economic scene. Palm Oil was higher on speculative buying tied to bargain hunting. Demand from India has been hardest hit due to a political problem between the two countries. Production is lower but is starting to increase seasonally.
Overnight News:
Chart Analysis: Trends in Canola are down with objectives of 441.00 March. Support is at 446.00, 443.00, and 440.00 March, with resistance at 451.00, 455.00, and 458.00 March. Trends in Palm Oil are down with objectives of 2340 and 2240 May. Support is at 2390, 2360, and 2330 May, with resistance at 2480, 2520, and 2570 May.

Midwest Weather Forecast: Rains today and snow tomorrow, then mostly dry weather. Temperatures should average near to below normal after a warm day today.

US Gulf Cash Basis
Corn HRW SRW Soybeans Soybean Meal Soybean Oil
February +46 Mar
+155 Mar
+100 Mar
+57 Mar
+12 Mar N/A
March +52 Mar
+105 Mar
+59 Mar

April +56 May
+105 May
+50 May

DJ ICE Canada Cash Grain Close – Feb 26
WINNIPEG — The following are the closing cash canola prices
from ICE Futures.
Source: ICE Futures
Price Basis Contract Change
CANOLA
*Par Region 416.30 -31.50 Mar 2020 dn 0.26
Basis: Thunder Bay 463.40 7.00 May 2020 up 0.10
Basis: Vancouver 474.40 18.00 May 2020 up 0.10
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 – February 27
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Thursday, 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
Mar 630.00 +02.50 Unquoted – –
Apr 617.50 +10.00 Unquoted – –
May/Jun 610.00 +10.00 Unquoted – –
Jul/Aug/Sep 612.50 +12.50 Unquoted – –
Oct/Nov/Dec 615.00 +15.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
Mar 632.50 +02.50 Unquoted – –
Apr 620.00 +10.00 Unquoted – –
May/Jun 615.50 +12.50 Unquoted – –
Jul/Aug/Sep 615.00 +12.50 Unquoted – –
Oct/Aug/Sep 617.50 +15.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Mar 642.50 +05.00 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Mar 620.00 +02.50 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Mar 2,500.00 +0.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Mar 192.00 +04.00 Unquoted – –
($1=M200.2020)

DJ China Dalian Grain Futures Closing Prices, Volume – Feb 27
Soybean No. 1
Turnover: 113,697 lots, or 4.73 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-20 3,560 3,600 3,550 3,600 3,550 3,565 15 132 794
May-20 4,171 4,185 4,152 4,171 4,153 4,166 13 104,291 126,062
Jul-20 4,158 4,179 4,138 4,160 4,147 4,158 11 8 56
Sep-20 4,099 4,109 4,068 4,096 4,091 4,084 -7 9,019 22,588
Nov-20 4,008 4,009 4,003 4,005 3,998 4,007 9 9 267
Jan-21 4,010 4,040 4,005 4,026 4,011 4,026 15 238 1,461
Corn
Turnover: 315,964 lots, or 6.10 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-20 1,878 1,887 1,878 1,884 1,878 1,881 3 490 8,944
May-20 1,914 1,928 1,913 1,927 1,913 1,920 7 235,906 600,975
Jul-20 1,933 1,950 1,933 1,948 1,940 1,943 3 12,457 58,284
Sep-20 1,965 1,975 1,962 1,975 1,963 1,967 4 64,601 339,357
Nov-20 1,983 1,992 1,981 1,990 1,982 1,986 4 1,175 5,156
Jan-21 1,992 2,002 1,992 2,000 1,993 1,997 4 1,335 9,118
Soymeal
Turnover: 916,547 lots, or 24.60 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-20 2,577 2,609 2,577 2,592 2,574 2,595 21 819 4,373
May-20 2,643 2,668 2,642 2,646 2,633 2,657 24 578,383 1,237,590
Jul-20 2,673 2,696 2,672 2,673 2,664 2,683 19 50,064 82,931
Aug-20 2,716 2,728 2,708 2,710 2,705 2,718 13 1,365 2,341
Sep-20 2,732 2,746 2,725 2,725 2,723 2,736 13 273,155 1,278,278
Nov-20 2,758 2,770 2,751 2,752 2,747 2,761 14 5,835 2,136
Dec-20 2,788 2,794 2,780 2,780 2,776 2,785 9 55 352
Jan-21 2,789 2,801 2,782 2,782 2,781 2,792 11 6,871 34,081
Palm Oil
Turnover: 1,188,878 lots, or 62.02 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-20 5,296 5,504 5,200 5,200 5,286 5,294 8 39 23
Apr-20 – – – 5,438 5,606 5,438 -168 0 10
May-20 5,200 5,260 5,160 5,190 5,228 5,208 -20 1,047,757 384,533
Jun-20 5,236 5,238 5,170 5,238 5,200 5,216 16 16 11
Jul-20 5,144 5,144 5,144 5,144 5,190 5,144 -46 1 305
Aug-20 – – – 5,258 5,192 5,258 66 0 2
Sep-20 5,242 5,304 5,216 5,276 5,252 5,268 16 139,045 134,397
Oct-20 – – – 5,230 5,230 5,230 0 0 5
Nov-20 – – – 5,272 5,272 5,272 0 0 7
Dec-20 5,306 5,316 5,296 5,296 5,308 5,308 0 4 161
Jan-21 5,190 5,282 5,188 5,258 5,222 5,246 24 2,016 7,939
Feb-21 – – – 5,396 5,372 5,396 24 0 0
Soybean Oil
Turnover: 513,832 lots, or 29.90 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-20 – – – 5,618 5,618 5,618 0 0 2
May-20 5,770 5,828 5,762 5,796 5,786 5,794 8 421,932 359,777
Jul-20 5,864 5,864 5,864 5,864 5,864 5,864 0 200 624
Aug-20 – – – 5,986 5,986 5,986 0 0 4
Sep-20 5,900 5,950 5,892 5,924 5,914 5,922 8 89,472 192,091
Nov-20 6,000 6,000 6,000 6,000 6,040 6,000 -40 240 455
Dec-20 – – – 6,104 6,104 6,104 0 0 21
Jan-21 6,016 6,078 5,868 6,054 6,042 6,050 8 1,988 14,557
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.
The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author.
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