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Market Signals Weekly Report

The following are comments and discussion items from the weekly conference call of the Market Signals Team.

Discussion Items:

  • MS recommends selling 10 percent 2021 CZ at 5.15.
  • Nearby soybean futures continue to trade near the midpoint of range. Tight U.S. balance sheets supportive, but U.S. spring weather negative.
  • World vegoil prices traded lower on lower palmoil demand. World soymeal prices continue to trend lower on concern about China hog numbers.
  • Nearby corn futures rallied after USDA acreage report but dropping today after China said commodity prices were too high.
  • Soybean and wheat futures have failed to make new 2021 highs. That could be technically negative. Corn made new highs but quickly sold off.
  • Forecast suggests a normal U.S. Midwest planting season. Midwest summer weather could be warm with normal rains.
  • U.S. north plains saw some needed moisture. Brazil and west EU is dry. Argentina and most of the U.S. Midwest weather is good.
  • U.S. HRW crop coming out of dormancy. Crop looks favorable with a 2-week forecast that is cool and dry.
  • USDA estimated U.S. 2020/21 corn carryout near 1,352 million bushels versus 1,396 expected and 1,502 previous.
  • USDA estimated U.S. 2020/21 soybean carryout near 120 million bushels versus 119 expected and 120 previous. USDA raises U.S. exports but dropped residual.
  • USDA estimated U.S. 2020/21 wheat carryout near 852 million bushels versus 847 expected and 836 previous. USDA raised World wheat feeding.
  • Managed funds are net long 140,000 soybean contracts, 430,000 corn and long 10,000 Chicago wheat.
  • Farmer should continue to use a scale up cash selling for new crop sales. Still, prices have yet to trade any weather problem.
  • U.S. infrastructure plan could trigger higher U.S. debt and negative to US dollar. U.S. economy should grow, unemployment should drop.

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