AgriVisor Morning MarketWatch

Wednesday, October 06, 2021
The outside markets continue to heavily influence the commodities which makes predicting price direction more difficult. One of these is the value of the US dollar which has rallied to its highest level in the past year. Typically a strong dollar deters US exports as it makes our product more expensive for an importer. A strong US dollar also tends to increase selling in competing countries which we are seeing at the present time. This is especially the case on South American soybeans. Not only is the higher US dollar impacting exports, but so are the ongoing delays to exports out of the gulf. While terminals are reopening, they are not up to fully capacity. We are also seeing delays in the Pacific Northwest as repairs are made to that regions leading soy meal loader. The global energy market is also impacting commodity values from two different aspects. For one we continue to see disruptions to Chinese processing which is causing doubt over their long-term demand. We are also seeing concerns in the market over the impact of high energy values on fertilizer production. Not only is high priced natural gas starting to raise fertilizer values, but the availability of energy products is as well.  

* Brazil farmers liquidating inventory
* US export market remains sluggish
* Trade remains disrupted by Covid
* Covid also a concern for manufacturing
* US export line-up is starting to build
* Improved soil moisture reported in Brazil
* Only 36% of Brazil short of moisture
* Last year Brazil was 86% short
* Elevated ethanol manufacturing expected today
* Trade starting to position for Oct WASDE  

* EU corn production forecast lowered
* Argentine corn planting 17% complete
* Argentina sets export quota at 36 mmt
* USDA has Arg exports at 37.5 mmt 
* DDG values are firming
* 50% of Chinese crush plants remain idled
* China crush rate a 5-month low
* Global oilseed market supports soybeans
* Funds building short position  
* High US yield reports continue

* Global production expected to rise
* Importers starting to lower quality requirements
* Heavy rains slow Russian plantings
* EU raises production by 3.8 mmt
* Heavy winter wheat planting reported in US
* Energy issues hurt Chinese feed margins
* US slaughter keeps slowing
* US export demand questioned
* Traders building short cattle position
* Trade remains long hog futures

RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.