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E-Visor Reports: Market Watch

 
Thursday, September 10, 2020
The majority of today’s session will be spent getting final positions in place ahead of tomorrow’s WASDE updates. For the most part, trade is expecting to see declines in production from August. Average guesses are for 3 bushels per acre less corn and 2 bushels per acre fewer soybeans. No changes will be made to wheat as the final numbers on that crop will be released in the September stocks data on the 30th. While most of the attention in this release will fall on production, we cannot forget there will likely be changes to demand as well. New crop export demand has been strong in recent weeks and to see the USDA bump these higher would not be a surprise. At the same time, we may see them remain unchanged until we surpass current projected levels. To see changes to domestic usage would not be surprising either. Soybean crush is running at record levels and giving the indication it will hold there for several months. Ethanol demand is not as promising, and to see a decrease in that usage would be expected given the recent rate of consumption. This may be offset with feed demand though as cheap corn is offsetting wheat in many rations around the world. The question is if these changes are enough to alter balance sheets from where trade is comfortable. 

Highlights
* President Trump asks for fuel waivers to be denied
* Chinese trade tensions build
* Funds building long position in commodities
* Soybean plantings starts in Brazil
* Soils are dry in Brazil but not concerning
* Global grain/oils seed supplies building
* US farmland values holding steady
* Parts of US Plains hit with frost
* Freeze impacts Canadian crops as well
* WASDE report on Friday at 11:00 AM CT

Corn
* Safras predicts Brazil crop at 115 mmt for 20/21
* Nearly half of US 20/21 corn sales are to China
* Ukraine grain exports -18% from year ago 
* Chinese imports to keep rising
* Ethanol usage reduction expected
 
Soybeans
* New crop sales a record 24.2 mmt
* China accounts for half of demand
* Safras ups Brazil production estimate
* Frost affects Canadian canola
* Brazil soy sales higher than USDA estimate
 
Wheat
* Russia crop est up to 82.8 mmt
* US wheat sales equal to 5-year average
* Australia raises crop est 2.3 mmt
* Australian crop almost 2x year ago
* US winter wheat plantings ahead of normal
 
Livestock
* Chinese August meat imports 832,000 mt
* Chinese August imports -17% from July
* Concerns over Covid slow demand
* Taiwan imports now questioned
* Economy weighs on all demand

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.