AgriVisor Morning MarketWatch

Monday, October 11, 2021
Much of today’s session will be spent getting final positions in place ahead of tomorrow’s monthly supply and demand report. Most analysts are expecting to see an increase in soybean ending stocks estimates and a decrease to corn and wheat. This is in response to the quarterly stocks data that was released in September and a surprise increase in soybean inventory was reported. Trade has had time to digest this information, so the increase that we may see tomorrow is not expected to bring fresh selling. In fact, tomorrow’s report may reduce soy complex pressure in a “sell the rumor, buy the fact” manner. This is also true in wheat as the US stocks report came in under estimates. The difference between the two is that the current new crop stocks to use on soybeans is 4.2% and wheat is 29.8%. This gives wheat more room for a loss of stocks than soybeans. The corn reserves are also forecast to tighten but remain adequate with a stocks to use near 10%. This is right at the point where rationing tends to take place. The real driver of the report may come from the demand side if any decrease is projected given the sluggish export pace we are seeing.  

* Trade remains concerned with global economy
* China cutting fertilizer production, sales
* Freight rates starting to rise
* Rains continue to benefit SAM soils
* Improved conditions may elevate SAM plantings
* Russia lowers grain export forecast
* High prices not deterring gasoline demand
* USDA reports delayed 1 day this week
* Trade positioning for tomorrow’s WASDE report
* Higher stocks to use levels expected

* Brazil to expand corn-based ethanol
* Domestic use to limit Brazil exports
* Census yearly exports +5 mbu from USDA
* Farm sales starting to rise
* Yields remains highly variable
* Brazil puts cost of production at $8.00/bu
* Census yearly exports +5 mbu from USDA
* China crush in August -3.3% 
* US yield reports keep rising  
* Global crush margins improve

* Ukraine winter wheat 46% planted
* US exports continue to rise
* Exports still -12% from last year
* China most active buyer of US wheat
* Rains favor SAM production
* Domestic beef demand slipping
* US beef exports remain strong
* Boxed beef continues to weaken
* Pork cut outs turn mixed
* Slaughter pace steady with last year

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.