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E-Visor Reports: Market Watch

 
Monday, March 22, 2021
Last week’s liquidation carried over into the start of this week’s trade as well. Much of this week’s activity will focus on positioning ahead of the March 31st planting intentions and quarterly stocks data. While these reports will not be released for eight more trading sessions, there is limited reason for traders to wait until the last moment to get positions aligned. Not only will this data be released next week but it is also month a d quarter end. This is likely to elevate positioning even more than normal. We have seen several estimates released ahead of the USDA reports with an emphasis on acreage. Some of these have surprised trade by calling for elevated plantings of all three major crops. Others are more reserved and are only predicting an increase to one crop, with an emphasis on corn. These are based off weather models that are calling for drier conditions. Even these are being debated, as some models indicate a shift to a cooler, wetter weather pattern over the next few weeks which would be favorable for soybean plantings. This has tempered new crop bids as traders do not believe they will have to push as hard for plantings.  

Highlights
* Trade questioning Chinese demand 
* Fieldwork starting across Corn Belt
* Trade focused on next week’s data
* Month/Quarter end positioning to increase 
* US expected to see favorable spring for planting 
* No major early crop threats seen
* US ethanol production to keep rising
* Last week was highest in 3 months
* US ethanol reserves -13% from year ago 
* Economic data remains favorable, inflation likely 

Corn
* Corn demand likely underestimated
* More Chinese business expected this week
* Predictions for 40 mmt Chinese corn imports this year
* USDA has China imports at 24 mmt
* Cash basis remains firm
 
Soybeans
* Brazil soybeans cheapest in world
* Brazil harvest/exports gain momentum
* Export basis weaker
* Brazil yearly exports est at 85 mmt
* Indonesia Palm Oil exports +19.6% on the year 
 
Wheat
* EU yield +3.5% from average
* Ukraine yield +5.6% from average
* Australia predicts another big crop next year
* Russia raises crop est by 3 mmt
* US soil moisture levels build
 
Livestock
* Cash cattle trade very light
* Chinese hog herd -12 to 15% from ASF
* May take 2 years for China to fully recover
* March 1st COF 102% year ago
* Feb placements and marketings both 98%

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.