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AgriVisor Morning MarketWatch

 
Monday, February 22, 2021
The majority of this week’s trade will be spent getting positions in place ahead of month end. This will generate more activity this month as all three of the spot contracts go into delivery. We have already had several spot contracts rolled to the deferred months, but we always see a few right before month end. This can easily create wide price swings. As we see a transition from February to March, we will also see a shift in market attitude. This is the time of year when more interest is placed on new crop development and potential crop sizes. This started with the Ag Outlook Forum last week when the initial new crop balance sheet estimates were released. These were a pre-cursor to the planting intentions that will be released at the end of March and the first official new crop balance sheets that will be released in May. As we see this shift in market focus take place, we will also see a change in the fundamentals that impact daily price discovery. These will include daily weather outlooks and planting reports. We will continue to see attention placed on old crop balance sheets however, especially with the need for rationing on old crop stocks. 

Highlights
* China back from LNY, hoping for business
* Funds remain heavily long corn, soybeans
* Net farm income expected to increase 5.5% in 2021
* NWS predicts a warm spring 
* Cold weather has slowed fertilizer applications
* US ethanol industry also slowed
* Brazil exports remain sluggish, starting to build
* Next 3-4 weeks critical for Brazil crops
* Farm lenders increasing credit limits
* March First Notice Day is Friday

Corn
* US corn loadings up 410 mbu from last year
* Japan becomes leading destination for corn
* Trade disregards Mexico’s GMO policy
* Ethanol slow down to lessen demand
* Feed demand spikes on cold weather
 
Soybeans
* Brazil harvest only 1/3 normal rate
* Brazil yields vary considerably
* Yearly US inspections up 802 mbu 
* US likely to import meal
* Global crush margins rebound
 
Wheat
* Russia crop estimates questioned
* Australia remains top source for global needs
* Analysts start to reduce yearly demand
* Export inspections down 2% from last year
* Feed demand to increase
 
Livestock
* Feb 1st cattle on feed 101% year ago
* Feb 1st COF 12.1 million head
* January placements 103% last year
* Placements totaled 2.02 million
* Marketings -6% at 1.82 million

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. 
 

  SYMBOL IN EVEN SQUARE