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E-Visor Reports: Market Watch

 
Thursday, December 31, 2020
The majority of today’s trade will be spent positioning for year end. While trade is open normal hours, many will shore up positions and exit the market early. Much of this has already been done, but there are always positions left for the last day. This is not a typical year though, and many of the contract currently being held may simply be rolled into positions for next year, especially if they are profitable. Once traders return next week, we will see interest likely fall on two main topics; South American production and US demand. Several analysts have lowered their South American crop estimates in the past week, mostly those for Brazil. There are now estimates that point to a 127 million metric ton soybean crop for Brazil which is well under previous estimates. While this would still be a record sized crop it will not help replenish a global oilseed supply that has been greatly diminished. We will also see trade continue to attempt to ration US soybeans as stocks continue to erode. Positioning will soon be taking place ahead of the January WASDE and quarterly stocks reports as well. For today’s session, all interest remains on the soy complex and the need for rationing. 

Highlights
* Tighter balance sheets expected in Jan WASDE
* 80% of Argentine top soil short of moisture
* Argentine sub soil moisture remains adequate
* Technical buying continues in commodities
* US ethanol production -4.3% last week
* US ethanol stocks up 9th straight week
* Ethanol reserves +20% from October
* Slow farmers selling expected to start 2021
* Today is FND on Jan contracts
* Trade full session today, closed tomorrow


Corn
* Argentina suspends exports until March 1st 
* Argentina was not exporting much corn anyway
* Global corn values firming
* China booking large volume of Brazil new crop corn 
* US shipments up 71% from year ago
 
Soybeans
* Rationing needs to build
* China soybeans continue to rally
* Soybeans remain technically overbought
* Open interest continues to rise
* Soybean shipments up 76% from last year
 
Wheat
* Ukraine exports at 70% of quota
* Russia lowers export forecast
* Russia to limit exports through June
* Better US precip chances
* US loadings equal to last year
 
Livestock
* Managed money buyers surface in cattle
* Pork values continue to rally
* Cash cattle untested
* Packers need January coverage
* Feeders reconsider filling lots

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.