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E-Visor Reports: Market Watch

 
Friday, January 15, 2021
With the January WASDE well in the rearview mirror, trade is again focusing on demand for price discovery. One of the main questions in demand is how many soybeans China may buy purchase for the remainder of the marketing year. Given the recent buying pace we have seen there are thoughts China may book an additional 130 to 145 million bu before the next US crop is harvested. While normally this would not be a large volume, given current ending stocks estimates, it would totally deplete the US soybean inventory. This is not an option and is why we have seen the volume of rationing take place in the complex over recent weeks. The US dollar is starting to firm from multi-year lows though and the need for soybean futures to rally is lessening as a result. While rationing is still needed, the higher value of the US dollar is just as beneficial as higher futures. This does not mean soybean values can fully recede but does make them more susceptible for a reversal and profit taking. Much of today’s session will be spent getting positions in place ahead of the long weekend, as markets are closed Monday for the Martin Luther King Jr holiday.  

Highlights
* Elevated consumer costs pressure economy
* Most attention is on gasoline and food products
* Gasoline values up 8.4% in December
* Long-Term optimism grows in US ethanol industry
* Brazilian Real is rallying against the US Dollar
* IGC keeps world grain production record high
* Need for rationing grows
* Trade expects record usage for rest of marketing year
* NOPA Crush for December today
* Normal trade hours today, markets closed on Monday 


Corn
* China to lean to more GMO production 
* US expected to dominate exports through summer months
* Argentina an unreliable supplier
* Rains benefit So American crops
* Elevated double cropping likely
 
Soybeans
* Countries limiting oilseed usage
* Most declines in bio-diesel production
* Brazil soy crop 50% sold
* Canada may be over-selling canola
* Malaysia Palm Oil production lowest in 10 years
 
Wheat
* Wheat is driven by US dollar
* US export inspections -1.2% from year ago
* Global wheat values weaker
* All eyes on Russian tax decision
* Global production interest is rising
 
Livestock
* Feed margins pressure futures
* Slaughter remains high
* Consumer demand is stagnating
* Cash cattle trade picking up
* Beef/pork supplies to rise

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.