AgriVisor Morning MarketWatch

Wednesday, June 08, 2022
Over the past week we have seen a shift in the attitude of the entire commodity market. This is not uncommon once we get into the later stages of the planting season, especially with the pace the crops were seeded catching up to the normal rates. When planting was initially delayed, we had risk premium added to futures as not only was there concern acres may be unplanted, but that yields would be reduced. Once planting did get underway the rate quickly caught up to normal and eased these worries. At the same time we had a leaking of risk premium from futures. Weather has also turned more favorable since the start of the planting season for the Corn Belt with few areas of major concern. Long-range weather outlooks are now favorable with cool temperatures for much of the Corn Belt through June. If these outlooks hold, they will further reduce market worries and the need for premium in futures. This is the main reason we have seen futures soften in recent weeks, mainly corn. The stocks to use outlook on US commodities remains tight though, and this will prevent a total collapse in futures at this time.  

* Concerns build over US energy supply
* Weekly energy demand +2% on the year   
* US diesel reserves record low
* Quality of Ukraine inventory questioned
* DDG values weaken 
* World watching Chinese economy  
* Ukraine/Russian tensions build
* EU drought intensifies 
* EV growth hurts biofuel demand  
* WASDE report on Friday 

* Corn oil values soften 
* Early yields in Brazil “good” 
* Drought losses in Brazil may be light
* Census April exports 274.5 mbu 
* April ethanol exports a record 185.2 mil gal          
* China to auction 500,000 mt Friday
* Global production est rising 
* US crush industry continues to expand
* Yearly export sales 102.3% of estimate  
* Census April exports a record at 134.38 mbu    

* Australian farmers expand plantings    
* Dry weather benefits US harvest     
* Demand for Us offers is light          
* Russia raises export forecast
* French crop ratings slip further  
* Wholesale beef firming    
* So Korea continues to buy US beef 
* Mexico is top US pork buyer 
* Pork cut out soft
* Feed costs becoming more worrisome

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.