Weekly Ag Markets Update – 06/20/2023

Wheat:  Wheat markets were higher in all three markets last week on uncertain Midwest and world weather and a sharply lower US Dollar.  Rains are reported from the southern Great Plains to the Southeast, but the Midwest has for the most part missed any rain chances and the forecast looks dry for the next week or two.  In Russia, the government is setting a floor price at about $240.00 per ton in an effort to make more money.  The weather is still in focus here and around the world.  Scattered showers are being reported in southern areas.  Planting of Spring Wheat had been delayed due to reports some rain now in many of these areas so conditions are improving and producers are caught up with planting progress now.  Canada has been dry.  Dry conditions are a problem in Russia, and especially in the Spring Wheat areas there.  Australian production ideas have been fading as El Nino hits the country.

Weekly Chicago Soft Red Winter Wheat Futures

Weekly Chicago Hard Red Winter Wheat Futures

Weekly Minneapolis Hard Red Spring Wheat Futures

 

Corn:  Corn and Oats were higher last week as Corn traders reacted to the weather and the lack of demand news.  Demand for US Corn in the world market has been very low, but the US Dollar was much lower last week so demand ideas might soon get a boost.  Reports of dry initial development conditions were important. Chicago got up to 1.0 inches of rain early last week and then was mostly dry.  Dry and warmer conditions are in the forecast for next week.  Ideas are that the top end of the yield potential is lost but that no serious damage has been done yet.  Corn is rolling leaves in central and southern Midwest areas but could be in better condition to the north.  Corn is still finding some support from little US producer selling interest.

Weekly Corn Futures

 Weekly Oats Futures

 

Soybeans and Soybean Meal:  Soybeans and the products closed higher last week in part on the weather and on reports of strong domestic demand and interior basis levels.  The US Dollar was lower.  Growing conditions feature cool but very dry weather.  Some showers were reported in the Midwest over last weekend and early last week.  Chicago got less than 1.0 inches of rain and has been mostly dry since then as it was for weeks before the rains hit.  Warmer and dry conditions are forecast for the next week.  Ideas are that the top end of the yield potential is gone, but sever damage has not been reported yet.  Reports indicate that bio fuels demand for Soybean Oil is very strong and is pushing domestic demand for Soybeans.  Brazil basis levels are still low and the US is being shut out of the market for most importers.  Brazil is still selling a lot of Soybeans to China and other countries.  Brazil has a very good crop, but the additional Soybeans grown in Brazil will be partially wiped out by the losses in Argentina.  Argentina has been forced to import from Brazil to keeps its crushing facilities operating.

Weekly Chicago Soybeans Futures

Weekly Chicago Soybean Meal Futures

 

Rice:  Rice closed higher Friday in consolidation trading.  New crop months were also higher, but growing conditions are good and the overall new crop price strength has not been good so far.  Futures were much lower for the week.  The weather is still good for crop development.  Old crop offers still seem hard to find right now, but demand has been a problem all year.  Export demand has been uneven.  Mills are milling for the domestic market in Arkansas and are bidding for some Rice, but at least some mills say they now have enough bought to last until the harvest of the next crop.

Weekly Chicago Rice Futures

 

Palm Oil and Vegetable Oils:  Palm Oil was higher last week along with price action in Chicago.  In Malaysia, May production was 28.6% more than April at 1.1517 million tons.  Exports were all down and ending stocks were estimated at 1.597 million tons, down over 10% from last month.  AmSpec said last week that Malaysian exports are down 26% so far this month.  Ideas are that demand is generally weak, with China struggling to open its economy and India looking to Sunoil for imports at the expense of other vegetable oils.  Canola was higher.  Trends are turning up on the daily charts.  Reports indicate that domestic demand has been strong due to favorable crush margins, but export demand is questioned, especially since the release of the weaker than expected Chinese economic data last week.  Scattered showers and rains have been reported so planting and initial growth conditions are good.

Weekly Malaysian Palm Oil Futures

Weekly Chicago Soybean Oil Futures

Weekly Canola Futures

 

Cotton:   Cotton closed lower last week on ideas of weaker demand due to economic problems in Asia and imprioved production prospects here at home.  The weather has improved in Texas and most growing areas are in good condition.  The US Dollar was sharply lower and still in a down trend and there are still many concerns about demand from China and the rest of Asia.  Forecasts for showers are still showing in forecasts for West Texas to Oklahoma and Kansas and are expected to be beneficial.  Ideas are that the world economic problems were fading into the background as the US stock market has held strong and as the Chinese economy gets better after all of the Covid lockdowns.

Weekly US Cotton Futures

 

Frozen Concentrated Orange Juice and Citrus:  FCOJ closed higher last week as short term down trend turned up on the charts.  Futures remain supported by very short Oranges production estimates for Florida.  Historically low estimates of production due in part to the hurricanes and in part to the greening disease that have hurt production, but conditions are significantly better now with scattered showers and moderate temperatures.  The weather remains generally good for production around the world for the next crop including production areas in Florida that have been impacted in a big way by the two storms seen previously in the state.  Brazil has some rain and conditions are rated good.

Weekly FCOJ Futures

 

Coffee:  Both markets closed higher last week on less thana expected export volumes from Brazil and as traders were more concerned about a lack of fresh coffee from Vietnam available to the market right now.  A sharply lower US Dollar also supported both markets.  Trends are now down for the Dollar.  Brazil offers are starting to increase and could have impacted the futures price yesterday.  There are reports of good rains and dry weather mixed in for Arabica production in Brazil with high production expectations.  The Arabica harvest has started and offers of Arabica from Brazil are increasing.  There are still tight Robusta supplies for the market amid strong demand for Robusta, but the Brazil harvest is in the market now and is expected to take some of the demand.  Producers in Vietnam and Indonesia are said to have almost nothing left to sell and producers in Colombia are also reported to be short Coffee to sell.  The market really needs big offers from Brazil to sustain any down side movement.  Southeast and south Asian producers could see another tough production year this year due to the effects of El Nino.  Brazil May exports were 2.4 million bags in May, down 17% from last year.  Arabica exports were 1.99 million bags, down 21% from last year, and Robusta exports were 131,689 bags, down just 0.1% from last year.

Weekly New York Arabica Coffee Futures

Weekly London Robusta Coffee Futures

 

 

Sugar:   Both markets were higher last week on tight world supplies and despite news reports that Brazil production increased in the last half month.  The US Dollar was sharply lower yesterday and trends are down for the Dollar.   India will restrict imports until the first half of next year.  The current year export quota is already gone and the government has no plans to allow for additional exports at this time.  The market is still hurt by good growing and harvesting conditions in Brazil but supported by tight current supplies.   The production is not there to meet the demand in many countries, with only Brazil among the major producers looking to have a good crop.  Indian production is less this year and Pakistan also has reduced production.  Thailand also has a smaller crop.  Asian countries could face another year of short production as El Nino returns after years of La Nina.  European production is expected to be reduced again this year.  Chinese production could be the lowest in six years due to bad growing conditions.  Unica said that the center south Sugarcane crush as 46.2 million tons, up 5.5% from last year.  Mills produced 2.2million tons of Sugar, up 25% from last year, and 2.1 billion liters of ethanol, up 2.4% from last year.

Weekly New York World Raw Sugar Futures

Weekly London White Sugar Futures

 

 

Cocoa:  Both markets closed higher last week and closed at new highs for the move.  A sharply lower US Dollar supported buyers in New York.  Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast continue, Talk is that hot and dry conditions reported earlier in Ivory Coast could curtail main crop production, and main crop production ideas are not strong.  Midcrop production ideas are strong due to rain mixed with some sun recently reported in Cocoa areas of the country.

Weekly New York Cocoa Futures

Weekly London Cocoa Futures

Questions? Ask Jack Scoville today at 312-264-4322