Russian wheat pressured by drought and freeze | Weekly Commodity Market Update
On this Weekly Commodity Market Update, Will and Ben break down the impact of Russia's wheat production struggles and opportunities for U.S. exports.
Learn more about what's happening in the agriculture markets here: https://brownfieldagnews.com/markets/
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Market recap (changes on week as of Tuesday's open):
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➡︎ July 2024 corn up $.04 at $4.64
➡︎ December 2024 corn up $.04 at $4.88
➡︎ July 2024 soybeans flat at $12.48
➡︎ November 2024 soybeans up $.03 at $12.19
➡︎ July soybean oil down 1.37 cents at 44.95 cents/lb
➡︎ July soybean meal up $12.40 at $386.50/short ton
➡︎ July 2024 wheat up $.09 at $6.97
➡︎ July WTI Crude Oil down $1.06 at $78.24/barrel
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Weekly highlights:
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Federal Reserve Officials signal willingness to raise interest rates if needed. Minutes of the May FOMC (Federal Open Market Committee) meeting indicated officials were disappointed with inflation readings and a willingness to tighten policy further if risks of inflation materialize in an appropriate way.
US energy stocks were mixed for the week of May 17th. Stocks of crude oil increased 77 million gallons and distillate stocks increased 16 million gallons, while stocks of gasoline down 40 million gallons. Gasoline demand increased 5% week over week.
US ethanol production increased 6 million gallons to 300 million gallons. Corn used for ethanol this marketing year is up 3.9% from the same period last year. Ethanol stocks decreased 12 million gallons after being up 12 million gallons the week prior. Ethanol stocks remain seasonally high above the 5-year range.
Open interest positions of Chicago futures and options positions were up for Chicago wheats (+3.8%), corn (+1.0%), soybeans (+4.1%), cotton (+2.1%) and rough rice (+5.2%) while down for soybean meal (-0.9%) and soybean oil (-0.4%).
Managed money traders were net sellers of corn contracts reversing a historic net short covering. Traders sold 49,991 futures and options contracts of corn after reducing their short position 208,399 contracts in the prior four sessions. Soybeans and Chicago wheats were net buyers of 16,239 and 4,161 contracts, respectively. Managed money remains net short across all three commodities.
USDA’s May Cattle on Feed Report was neutral- US cattle on feed at 11.554 on May 1 was 99.1% of last year- near expectations. April placements of 94.2% were slightly above expectations with April marketings at 110.1% of last year and above the 109.8% trade expectations.
Weekly grain and oilseed export sales were mixed for week ending 5/16/24. Everything was within expectations. Old crop corn sales of 35.9 million bushels are seasonally strong for the third straight week. There were 8.3 million bushels of new crop wheat sales split across wheat classes. Old crop bean sales are 3% below the relative pace needed.
Last week’s grain and oilseed export inspections were neutral- corn shipments of 42.4 million bushels and wheat shipments of 14.7 million bushels were both at the top end of their respective ranges. Soybean shipments of 7.8 million bushels were at the low end of the pre-report range.
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Topics:
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➡︎ Market recap
➡︎ Russian wheat struggles
➡︎ Corn yield potential
➡︎ Chance of interest rate hike
➡︎ Reports to watch
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