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
Wheat: Winter Wheat markets and Minneapolis Spring Wheat were all higher again as the weather in the northern Great Plains and Canadian Prairies remains bad for production and on better demand ideas. The export sales report was relatively strong and helped push prices in all three markets higher. USDA also reported a sale of 134,000 tons of SRW to China on Friday. USDA showed sharply lower Spring Wheat production and much lower ending stocks estimates for All Wheat in its Monday reports. The bad weather is coming back as hot and dry conditions are in the forecast for the northern Great Plains and the Canadian Prairies for the next couple of weeks. White Winter Wheat production is also being hurt as both have been impacted by drought and heat this year. Yield reports have generally been good in Winter Wheat areas but there have been mixed results reported in some Great Plains states. Quality has been generally good. World prices are expected to bottom soon and start to move higher, supporting Wheat futures markets in the US.
Weekly Chicago Soft Red Winter Wheat Futures
Weekly Chicago Hard Red Winter Wheat Futures
Weekly Minneapolis Hard Red Spring Wheat Futures
Corn: Corn was lower Friday and for the week and the weekly charts show a reversal pattern. The weekly chart trends might be down now even though the growing conditions in the US are highly variable and not likely to produce trend line yields. The daily charts imply a recovery trade is coming before any new moves significantly lower.. Traders are reducing yield estimates from the USDA report of 179.5 bushels per acre to more like 174 bushels per acre and ideas are that more adverse weather could drive yields lower. No one is talking much about increasing yield estimates right now. The weather has improved in the last couple of weeks as many dry areas got a little rain. But, forecast outlooks call for warmer and drier conditions for the rest of the month in western areas so the benefits of the rains might be limited. Ideas are that Brazil Corn production will be less than 90 million tons so reduced production estimates are expected in coming reports. Oats were higher once again. Canadian Oats areas look to get some rain in the next couple of weeks, but US areas showed mixed conditions in the weekly USDA updates. Longer range forecasts released by NWS call for warmer and drier weather for many important US growing areas this Summer.
Weekly Corn Futures
Weekly Oats Futures
Soybeans and Soybean Meal: Soybeans and the products closed firm on the weekly charts. The highs were made early in the day and then some long liquidation and perhaps new selling hit the pits,, but futures were able to recover to close higher. Reports of big rains in much of the Midwest and forecasts for more rains in the coming week were negative, but some areas are now getting too much rain. Minnesota and northern Iowa and the Dakotas should get very little, if any, rain. Forecasts call for cooler weather this week in the Midwest and northern Great Plains, but it should generally be dry. China has started with new US Soybeans purchases for Fall delivery. The longer range forecasts from NWS call for warmer and drier than normal conditions for most Soybeans areas of the US.
Weekly Chicago Soybeans Futures:
Weekly Chicago Soybean Meal Futures
Rice: Rice closed a little higher again Friday in limited volume trading on what appeared to be speculative buying. Futures were higher for the week. Growing conditions have been mixed at best with many areas getting too much rain. Rice areas have generally been wet. Louisiana and parts of Mississippi were saturated and are still reported to be wetter than desired for strong production and good quality. Warm temperatures are reported in Arkansas and Missouri and the crop progress is improving. However, it is still very wet in Arkansas. Texas has also been wet. Export demand was disappointing in the weekly sales report last week and Asian prices are trending lower.
Weekly Chicago Rice Futures
Palm Oil and Vegetable Oils: Palm Oil futures were higher on demand ideas and ideas of shrinking supplies. Trends are up on the daily charts. The private surveyors showed more demand for last month in reports issued last week and ideas are that the stronger demand can continue as India has cut its import taxes. Canola closed higher in a weather market. Trends are still up and weather concerns continue strong. It remains generally dry and is turning warmer in the Prairies. The showers last week have a chance to be very beneficial as the Prairies crops are in big trouble now due to previous hot and dry weather. Demand has improved a little bit with the recently weaker prices.
Weekly Malaysian Palm Oil Futures
Weekly Chicago Soybean Oil Futures
Weekly Canola Futures
Cotton: Futures were higher again Friday and were higher for the week as speculators bought on weather concerns and on ideas of increasing demand. The weekly export sales report showed only moderate demand but the monthly WASDE report helped fuel the charge higher last week. Production was increased due to a sharp increase in planted and harvested area, but yields were lower. Exports were increased as domestic demand remained unchanged. Ending stocks were higher but still show that a tight situation is developing. Production ideas are being impacted in just about all areas due to the weather extremes. Demand was increased in the weekly export sales report and is expected to stay strong as the world economy rebounds from the Covid times.
Weekly US Cotton Futures
Frozen Concentrated Orange Juice and Citrus: FCOJ closed lower on Friday but higher for the week even as there are no new tropical systems forming in the Atlantic at this time and conditions in Florida are rated mostly good for the crops. USDA slightly increased its production estimate for the second month in its production reports released on Monday. A big storm could threaten trees and fruit. Brazil is reported to be in good condition, but dry. It has been cold but any damage is called minor. Cold weather is forecast for later this week and a little damage is possible although rated as not likely by forecasters. Mexican crop conditions in central and southern areas are called good with rains, but earlier dry weather might have hurt production. Northern and western Mexico areas are getting some rains and conditions are rated mostly good. Some areas have had too much rain. Florida inventories are now 16.7% below a year ago.
Weekly FCOJ Futures
Coffee: New York was higher and London closed higher on Friday and for the week on weather and demand concerns. London remains firm overall on some speculative and commercial buying tied to dry weather in Southeast Asia and on reports that Vietnamese producers were not selling or delivering. New York was higher along with the Brazilian Real as producers there were not willing to sell with the stronger Real. Temperatures are now warmer in Brazil and there are no forecasts for damaging cold for a few days. It could get vey cold after that although maybe not cold enough to damage trees. There were some losses created by a hot and dry start to the growing season that impacted flowering and initial cherry development and a little Coffee was lost during the freeze event a couple of weeks ago. Asian Coffee areas are dry, especially in Southeast Asia, but increasing showers are coming this week and tree condition should be improved. Good conditions are reported in northern South America and good conditions reported in Central America. Colombia is having trouble exporting Coffee due to protests inside the country. Conditions are reported to be generally good in parts of Asia and parts of Africa.
Weekly New York Arabica Coffee Futures
Weekly London Robusta Coffee Futures
Sugar: New York and London were higher Friday as the medium term trends are up again. Reports of damaged can in Brazil from the recent cold snap were heard and pictures of the damaged were tweeted. Brazil temperatures have moderated and the weather there is considered mostly good for production. Warmer temperatures are reported now but it is forecast to turn cold again this week. It might not get cold enough to damage the cane but the market is worried and has added weather premium to the price. Mills were also processing for more Ethanol and less for Sugar than expected and this trend should continue with higher world petroleum prices. London has been the leader to the downside on ample supplies of White Sugar available to the market and as demand for White Sugar is less. There is plenty of White Sugar available in India for the market and monsoon rains are promoting good conditions for the next crop. The Indians are selling with or without a subsidy from the government. Thailand is expecting improved production. Sugar demand is said to be weak. Ethanol demand is returning to the market as more world economies open up after the pandemic.
Weekly New York World Raw Sugar Futures
Weekly London White Sugar Futures
Cocoa: New York and London closed lower on Friday but higher for the week on indications of stronger demand. The European grind data was released early last week and showed a strong recovery from the Covid times. Asian data was released on Friday and also showed increased demand, although not as much of an increase than showed for Europe. The daily charts show short term mixed trends in New York and in London and the fundamentals remain bearish despite the increased demand. Ports in West Africa are filled with Cocoa right now. The weather has had above average rains in West Africa and crop conditions are rated good.
Weekly New York Cocoa Futures
Weekly London Cocoa Futures
Questions? Ask Jack Scoville today at 312-264-4322