CommStock Reports

On the Grains Grains are firmer in overnight trade with beans leading gains. USDA reported crush in March a little lower than expected but still at an all-time record for any month. It was still enough to hint USDA's current forecast for the year is too low. Rapidly improving basis for beans in Brazil add credence to what private estimates and their own CONAB have insisted for months that their crop is much lower than what USDA has estimated. Weekly ethanol stats from EIA were supportive for corn. Production was higher and stocks lower than trade expectations. YTD data still suggests current corn usage for ethanol projected by USDA is solid and if anything, a little low. Crude oil took a big tumble, when stocks rose by 7.3 million barrels vs. expectations for a 1.5 million barrel decline. On the other hand, diesel stocks fell by 732,000 barrels and are 7% below the 5-year average. Even wheat is firmer overnight despite welcome rain forecasts for parched HRW areas because it won't stop raining in key SRW states and could now start hurting condition ratings. The forecasts for continued rainy weather slowing planting progress are an underlying supportive factor, even though once the crop is planted the "rain makes grain" mantra will resume. For now, fund selling in grains seems to have subsided. Already very heavily short, yesterday's absence of fund selling hints they're content to either hold current positions or lighten up if anything. Reaction among farm groups to the changes in the model for ...

Disappointing April Planting Progress Now Stalled   With the very early teasing of spring starting in February this year, I was anticipating the possibility of planting everything in April. I was planning to plant soybeans first. Then the weather happened. My corn went in April 25th but the soybeans will be planted in May. The family got nearly 50% of its corn in, in the short window that opened last month. The open conditions so early this year, allowed prep work which made it possible for a lot of crops to get planted in a very short open window. We had an extraordinary number of prep days this year but too few days that were actually fit to plant. Climate Scientist Eric Snodgrass was looking for things to break open in mid-April but the real spring was reluctant to arrive and is still coming in the forecast. The cool/wet pattern prevails. Looks like most crops will get planted in May. It is still snowing in the west and the frost line dips into the NE Corn Belt failing to fully retreat into Canada as well. The good news is that the area still under drought continues to shrink in the US. Our soil moisture profile has been fully restored. In fact, there are now a few regions where conditions are wet and planting is being delayed. Crops that did get planted early with subsoil moisture conditions that were recharged will be tough to kill later this summer.   Brazil Gearing Up to Take National ...

On the Grains Markets are mostly weaker in overnight trade. The weather outlook keeps getting wetter for much of the Corn Belt over the next couple weeks, so the planting pace "lead" compared to normal we have at present is likely to rapidly shrink and could even fall behind if the forecasts verify. Yesterday was a blitz of negatives for the grain market rooted in outside markets going into "risk off" mode ahead of this week's Fed meetings that end today. They're expected to stay hawkish on rates in their comments, more than hinting not to expect any cuts in the foreseeable future due to stubborn inflation despite slowing in GDP growth – the very definition of "stagflation" at time that stocks have only recently hit record highs. The DJIA took such a beating yesterday that we had the first lower monthly close after five straight monthly increases. They're down again overnight. The monthly DJIA chart also shows the brief poke above 40,000 was the upper Bollinger band and the Stochastics oscillator in the "overbought" zone since last fall was turning down. It spilled into the grains because the dollar made a new high on prospects for interest to stay higher for longer and precious metals took a hit as well. Even KC wheat took a hit on better chances for rain in the parched western half of the southern Plains where the condition ratings have been in decline. The negativity was compounded in cattle with the announcement USDA would begin spot-checking hamburger for traces ...

As a baby-boomer I am old enough to harbor some animosity toward the Japanese, not only for the Day of Infamy December 7th, 1941 that they inflicted on us but for the way they conducted the war. Japanese soldiers fought to the death which meant a lot more American soldiers had to die to kill them. There is justified ill-will in the region harbored by the Chinese and the Koreans for brutal treatment from the Japanese army. The survival rate of allied prisoners of war held by the Japanese was very low due their inhumanity. By contrast if US POWs reached German Stalags there was a high probability, they lived to talk about it after the war. The war ended and Douglas MacArthur did not repeat the mistake of Versailles ending WW1. He let the Japs up easily, allowing them to keep their Emperor, who was legitimately a war criminal, recover their dignity and due to good behavior, their independence. The Japanese people took it from there, rebuilding their nation and joining the community of nations to become a respected ally from the last cold war into this new one. They are a stable liberal Western democracy and one of America's most reliable friends. It was a hellofa transition.   They have now become one of our strongest military allies and counterbalance to an aggressive China in the western Pacific. While post WWII, they limited their military to defense; they built an effective technologically superior force which was trusted by the US ...

On the Grains Grains and soybeans are steady to weak in overnight trade with soybean meal a notable exception. It's up again and punched through some chart resistance overnight. It was up strongly yesterday on news from Argentina. They ship most of their crop as soybean meal and not only is their harvest far behind normal (25% vs. 48%) their oilseed crushers union has gone on strike. Even though rain moved into many areas Thursday and through the weekend, yesterday's Crop Progress Report showed corn planted 27%, pretty much what the trade expected and still ahead of last year's 23% and the 5-year average of 22%. On a state-by-state basis, Missouri, Arkansas and Kansas have the biggest leads over last year and average but Minnesota and Iowa have big leads as well and these 5 states account for a big part of the national lead. As for "laggards", CO, IN, KY, and AL are the only states that are several points behind normal and the rest are all either on track with normal or a few points ahead. Next week, we expect to see the lead shrink back closer to normal with widespread rain through last weekend lingering as it moves east and this week normally a "peak" week for planting progress. Soybean planting came in at 18% complete, a couple points faster than expected. That's up 2 points from last year and 6 points faster than the 5-year average. On a state-by-state basis, every state either side of the Mississippi River from Minnesota ...

My recent article on Tesla/EVs generated such a response from you that I thought it deserved another swing. Geniuses have done amazing things. Aristotle, Issacc Newton, Galileo, Leonardo da Vinci, Archimedes, Michealangelo, Mozart, Beethoven, Benjamin Franklin, Einstein, Steven Hawking, Bill Gates, and Steve Jobs are just a few with the most notoriety that make the list of Geniuses that have advanced the development of the human race with their intellect.  Yes, even Nikola Tesla, the namesake of Elon Musk's attempt to reinvent vehicles with electric propulsion, was a genius which is why Musk picked his, as the name of his company. Musk is considered to be a genius himself but there is IQ and there is EQ. Musk has a lot of the former and maybe hindered by not enough of the later. On the surface his personal life doesn't look like one run like a genius but then again if you look back at all the historical geniuses, they were all a bit eccentric. I think that he let his emotions rule the decision to buy Twitter which has to have been one of the most immediate flushes of cash down the drain that must have his investors wondering what truck hit them. It was so bad they rebranded the company to X. Now when referring to the company they always say "Twitter, now called X" so what did the rebranding do for them? I have never participated on the platform. My bet is that historical geniuses' first question ...

On the Grains Grains are steady-to-mixed in overnight trade to start the week. It was a very stormy weekend with over 100 tornadoes, frequent hail and widespread rain over much of the Midwest and Delta, that will slow planting considerably. Yet the pace was brisk through the early part of last week so today's planting progress report should still show planting on pace with normal because we were a little ahead of normal the prior week.   Wheat was the clear leader in the grains last week on the unexpectedly sharp drop in wheat condition for HRW that more than offset the best ratings for SRW in decades. We'll likely see further declines in today's report, the rains have missed up to 40% of HRW wheat in western KS, the OK panhandle and W. Texas. Globally, conditions for wheat continue to deteriorate in southern Russia, eastern Ukraine and parts of western and southern Australia.

Corn and soybeans will look for guidance from whether or not wheat futures can extend their gains after finishing higher in seven sessions straight. Most calls are for a slightly softer start in reflection of a better forecast for world weather. The spreads should remain active as positions are cleaned up after May options expired on Friday and before first notice day on Tuesday. In the Headlines July Kansas City wheat futures were the upside leader last week with a gain of 71 1/4 cents over the five sessions. July Chicago wheat finished up 55 1/2 while July corn rose 7 cents. July beans were higher by 11 1/2 cents for the week. April live cattle climbed $3.20 and May feeders were up $6.70. June hogs lost $2.35 last week. Wheat's recent leadership was sparked by another Russian attack on Ukraine's Odessa port before price strength was extended with help from concerns over dry weather in Russia as well as deteriorating crop ratings for Europe and the Southern Plains. Another crop condition ratings cut is expected for U.S. winter wheat on Monday's Progress report. Bullish fundamental inputs triggered an eventual technical breakout as Chicago wheat futures climbed above $6 for the first time since February. The Federal Reserve Bank will hold a meeting this week before issuing guidance on monetary policy Wednesday afternoon. No change is expected for interest rates. The market-implied odds of a rate cut in June are down to only about 10 percent. Maintaining a hawkish stance on interest rates is ...

This week's planting progress numbers did not trigger any alarms for the market, as corn plantings were just ahead of their 5-year average at 12 percent while soybeans at 8 percent were double their normal pace.  Even the recently water-logged Delta states had caught up on row crop and cotton plantings. Patchy spring storms have still made for somewhat of a sporadic start to the new planting season, but the moisture has been welcomed after a dry winter for most. As always, the risk will be that rain continues to fall where plantings eventually become delayed while the driest areas of the country could keep missing out.   Many of the areas where we are getting reports of active planting are the same areas that suffer the most from lingering drought. The large patch of long-term drought spreading from Kansas through eastern Nebraska, northern Missouri, Iowa, Minnesota, and Wisconsin encompasses a portion of the country that is relatively much further along on planting corn and soybeans.  Across most of the Eastern Corn Belt and down throughout the Southeast, drought is not as much of a concern as is the wetter forecast for the start of the planting season. A drier two-week outlook should help clear the way for planters to roll, but the overall trend calls for storms to develop in the Gulf of Mexico and persistently push up into the eastern region this summer.   The ramifications of any potential planting delays are considered in a farmdoc daily article by University of Illinois ...

WHEAT RECCO UPDATE DAY 2: On 4/23 we advised SRW and HRS producers to sell remaining '23 wheat but for HRW producers to sell just another 20% (to 85% sold) to squeeze a bit more from KC wheat on this rally. We've gotten that and advise HRW producers to complete '23 sales as well. FUEL NEEDS RECCO UPDATE DAY 2: On 11/16/23, we had advised covering 50% of fuel needs through spring. With ULSD futures at last fall's lows, we advise pricing needs through summer. (If your local retailers aren't offering prices that far out, contact your Commstock broker for ways to do so via hedging in futures.) On the Grains Grains are steady-to-weak in overnight trade. Heading into the weekend traders are focused on planting progress here and harvest progress in South America. Ours will be slowed by extensive wet weather beginning today into early next week while significant progress was likely made through yesterday. Brazil's bean harvest is in the home stretch but will now be slowed by heavy rains in the southern end down through Argentina where harvest for both corn and beans are already well behind normal. Weekly export inspections for corn were terrific. At 1.3 million tonnes they blew away the top end of pre-report estimates ranging from 400k to 900k. They are closing the gap between where they should be by now to meet USDA's current export forecast. Soybean sales, on the other hand, were a paltry 211,000 tonnes and didn't even make the low end of the expectations from 300K to 600K. ...

Tesla's Cybertruck sales lost the gas pedal. Almost literally… as sales were put on hold.  Its creator, Elon Musk, may suffer from the greatest case of hubris ever contracted by a genius. The line between genius and madman cycles close and he has been alleged to have crossed it by taking on so many tasks that he can no longer do any of them well. Musk loves the moonshots but his attention seems to drift away to chase after the next bright shiny object that grabs his interest when the unfinished work gets hard on the current one. Tesla has gone from being unable to manufacture enough EV vehicles to satisfy the initial demand of those infatuated with them, to when once filled, additional demand turned out to be less than they expected it would be from the less infatuated. Color me fully un-infatuated. I see Tesla's new truck as the ugliest tin can ever put on 4 wheels. I kept wondering when someone was going to clue Tesla designers in on the fact that they were building an EV ugly duckling but they did not want to hear it. They actually expected to mass produce a near $100,000 model of this truck.   Responding to deteriorating market conditions, Tesla announced a 10% reduction of their global workforce as well as having several key employees jump ship looking for better futures than what they now see with Tesla. According to Bloomberg, a 10% reduction of the global payroll saves them $550 mln ...

WHEAT RECCO UPDATE: On 4/23 we advised SRW and HRS producers to sell remaining '23 wheat but for HRW producers to sell just another 20% (to 85% sold) to squeeze a bit more from KC wheat on this rally. We got that, and today advice HRW producers to complete '23 sales as well. FUEL NEEDS RECCO UPDATE: On 11/16/23, we had advised covering 50% of fuel needs through spring. With ULSD futures now at last fall's lows, we advise covering fuel needs through summer with local retailers, but if yours are not offering bids contact your Commstock broker for ways to do so via hedging in futures. On the Grains Grains are steady to soft in overnight trade. Even wheat is mixed at best. Rainy weather is moving in to slow planting through the weekend and into next week, but planters have been rolling aggressively through the early part of this week. The reality is that it's too soon to threaten any serious delays and the rain is still welcome for replenishing soil reserves in most of the country. Ethanol data wasn't helpful yesterday. Weekly production was down again and the 2nd lowest in more than a year and stocks declined only slightly. Yet there's been enough lead built up that USDA's current corn-for-ethanol forecast is still likely to be met. Without a serious weather scare, corn is likely stuck in a range between $4 and $5 as evidenced on the weekly chart. Ending stocks are so large corn hasn't even entered the overbought zone in more than 18 months ...

My family wrapped up the 23/24 soybean harvest on our farm in Brazil.  Yields came in at about 59 bpa, which is around 10% below APH.    Yields started out promising at the start of harvest but the later planted fields were disappointing.  Considering the ultra-dry start to the season, we came out ok.  When I was at the farm in mid-December, things looked rather bleak.  By the third week of December the rainfall started to pick up again and the crops got caught back up.  We are more of a seed farm than a grain farm and so the quality of the seed means as much or more to us than the quantity of grain produced.  It rained a lot in March as harvest was progressing, which tends to damage germination levels.   Safrinha corn stages are quickly approaching 80% in the pollination to grain fill stage.  Earlier planted corn is "saved" at this point as they are at the ending stage of the crop cycle.  Meanwhile later planted corn is left extremely exposed to the start of the dry season.  The ten-day European forecast shows a giant donut hole forming over Central Brazil, encompassing major second crop corn production areas.  Most of Mato Grosso, Goiás, Mato Grosso do Sul and Parana will receive next to nothing.  Regions in Northern Mato Grosso may still receive an inch of rain.  It would appear that the rainy season is wrapping up on schedule.    Unless something changes, second crop corn growers will have to rely ...

NEW WHEAT RECCOS DAY 2: On prior advice SRW producers are 80% sold on '23 wheat and 15% hedged on '24 wheat. HRW and HRS producers are 65% sold on '23 wheat and nothing sold on new crop. SRW and HRS producers are advised to use this rally to sell all remaining old crop, while HRW producers are advised to sell another 20% (to get to 85% sold) but hang on to the last 15% to squeeze a little more out of this rally with HRW crop ratings declining. On the Grains Grains are steady-to-mixed in overnight trade after a strong start to the week and hints that funds are becoming more inclined to lighten up on huge net short positions than add to them. The weather outlook is turning wet again for much of the Midwest and central Plains from tomorrow through the weekend, which will likely slow the planting pace reported in Monday's Crop Progress report. Ukraine's Ag Ministry predicts about a 10% decline in grain output this year dry weather is beginning to tone down Russian prospects as well. Further, in response to the new major financing for Ukraine moving through the Senate and to Biden's desk, Russia is expected to aggressively step up its attacks on Ukrainian infrastructure before re-supply reaches Ukrainian forces. That keeps Ukrainian export capacity in question. Another positive development for prices is on export logistics. Mississippi river capacity is back near normal and there's continued optimism on Panama Canal capacity rising. As we reported earlier, daily throughput rose to ...

There is not a neighboring European or country in Asia which has had any interaction with Russia and Russians in their long histories which has not come to regret ever trusting their motives, intentions or words. Russians are about as close today to being the ruthless Vikings of old as exists. They will lie, cheat, steal, kill without aversion to getting whatever their want of the moment turns out to be. What they want is whatever others have that is convenient for them to take. Fins, Poles, Latvians, Georgians, or Ukrainians harbor no illusions over who and what Russians are. They are carrying forth a legacy of empire in which they see themselves as the high caste and the rest of the world their vassals. There is no such thing as an agreement, treaty, armistice or détente that is anything more than a chess move to allow Russia to seek out the next weakness in opponents to exploit. To Russians everyone is an opponent, every breath is taken toward conquest. The collapse of the Soviet Union represented the limits of extension of Russian hegemony in Eastern Europe. The Russian Federation under Putin is an attempt at a secondary rally in a bear market that will again give way to a resumption of what is the major trend of Russian political and economic implosion. The more realization of their impending demise, the more desperation they will display. The more dangerous they will become.   Putin's war on Ukraine has exposed Russian weakness. The ...

NEW WHEAT RECCOS DAY 1: On prior advice SRW producers are 80% sold on '23 wheat and 15% hedged on '24 wheat. HRW and HRS producers are 65% sold on '23 wheat and nothing sold on new crop. SRW and HRS producers are advised to use this rally to sell all remaining old crop, while HRW producers are advised to sell another 20% (to get to 85% sold) but hang on to the last 15% to squeeze a little more out of this rally with HRW crop ratings declining. On the Grains Grains are firm in overnight trade as of 6am, with wheat the clear leader as it was yesterday before traders had even seen the big hit to HRW wheat ratings released after the close (more on that later). As for weekly export inspections, corn was the only big winner. At 1.624 million tonnes it easily beat the top end of expectations at 1.5 million. Beans and wheat were within the range, but towards the lower end. After the close, we got the weekly Crop Progress Report. It showed corn planting at 12%. That met expectations, was on par with last year and 2 points ahead of average. On a state by state basis, Missouri leads the Midwestern states at 47% planted, more than double its average of only 21% at this point. Iowa at 13% is also well ahead of its average 8% at this point. (Michigan and Wisconsin are the laggards at 1% and 2% respectively.) Soybean planting came in at 8%, a point ...

Typically, most watch the US drought monitor but NOAA releases a North American version every two weeks. One can see that while drought has been completely mitigated in the Western US there are still lingering patches of drought in the Heartland. The drought has not been mitigated in Canada while the severe concentrated drought still covers Mexico with no sign of relenting. Where we live in Northwest IA the drought here is gone. Our soil moisture reserves have been fully recharged by late fall, winter and now spring rains so that we are starting the season out with a full tank of subsoil moisture. We got nearly 2 inches of rain last week and for the first time we had excess water standing in fields. More rain is forecast this week so planting will not be as super-early as thought. Additional rain now could actually delay planting and be a negative thing. There are other regions such as in the ECB or Delta where too much rain is a problem. Then there is still Kansas that can be counted upon for drought.   The primary characteristic of the climate setup for 2024 is the transition from El Nino to La Nina. This is a transition year. While there are a number of years where such an ENSO transition has taken place, no one year is identical to another. The speed and depth of the transition should have a very important impact on our summer weather in the corn-belt. If the crops get ...

On the Grains Grains were mixed in overnight trade with corn and beans on the soft side but wheat prices firming as of 6am. Weekend news was dominated by both events and non-events in both DC and the geopolitical arena: The major event was House passage of $95 billion in 3 separate aid packages for Ukraine, Israel and Taiwan. It's likely to clear the Senate easily but it happened only through Dem support that offset GOP opposition because the bills lacked any funding for U.S. border control and have Speaker Mike Johnson still facing criticism within the party. The major non-events making news are seemingly lessened risks of widening regional war with few signs either Israel or Iran want to trade blows again for reasons discussed below. That has oil prices quiet along with ideas OPEC+ has enough unused capacity to mitigate disruption of Iranian supplies. The Commitments of Traders report out after markets closed was somber news for those of us hoping this market will need to build in some weather risk and perhaps trigger more short covering by funds. It showed that through last Tuesday, those funds had actually been adding to already-large net short positions in all the grains except MGE wheat. They'd also been dramatically unwinding spreads by selling off oil and buying back meal. Now attention shifts back to planting progress and wheat ratings that come out with the weekly Crop Progress Report after markets close. Wheat is firmer overnight on the reality that it's been dry in ...

Follow-through interest will be tested after the grains posted a firm close on Friday. The overall tone of the grain trade is likely to largely depend on which directions oil and the dollar index are heading. In the Headlines A strong close on Friday limited the weekly loss for May corn futures to 2 cents. May beans were down 23 1/2 cents last week. May Chicago wheat was down 5 3/4 cents while May Kansas City wheat dropped 8 1/4. April cattle were up $2.57 and April feeders gained $3.72. June hogs were up $2.75 for the week. The House of Representatives voted on Saturday to pass a spending package worth $95.5 billion that includes $61 billion for Ukraine, $26.4 billion for Israel, and $8.1 billion "to counter China's actions in the Indo-Pacific" (protection for Taiwan). As the federal government is taking on new debt at relatively higher interest rates, the total cost of servicing the deficit amounts to 36 percent of annual tax receipts – the highest level in 27 years. Interest costs could increase by almost another 50 percent by the end of the year if the central bank does not reduce rates. The Environmental Protection Agency issued a waiver to a allow sales of E-15 ethanol blends this summer, the third consecutive year granting the allowance. The ethanol industry is joined by certain lawmakers across the Midwest in continuing to lobby for the permanent acceptance of higher blends. It was a slight negative influence for the market earlier last week that the ...

Grain basis levels have taken on a heightened level of variability this year, showcasing a notable disparity between the country's western and eastern regions. While corn basis remains notably stronger in the West, soybean basis displays relative strength in the East. These discrepancies cannot be solely attributed to supply differentials, given the robust crops witnessed on both sides of the Mississippi River last season. Instead, the driving forces behind the basis differences lie within the dynamics of demand. In the West, firm corn basis is supported by robust ethanol usage, elevated export demand from the Pacific Northwest, and stiff competition within the rail market that draws corn into the Southwest. In the East, soybean basis is bolstered in large part by a wide network of processors that serve a consistent draw from the southeastern poultry sector.   Differences between Illinois and Iowa show the nature of basis being split by region. Country elevators across much of Iowa are posting corn bids against basis that is relatively strong for this point of the season, with a statewide average of 2 cents over the May futures price. At 24 cents under the board, Corn basis in Illinois is closer to its modern historical average. Soybean basis values are flipped by relative strength, with Iowa weaker at 48 cents under against Illinois averaging 22 under. Weaker corn basis in Illinois and the rest of the Eastern Corn Belt may be primarily attributed to soft river market demand that follows from Chinese purchases being down significantly this ...

On the Grains Grains are all still firm in overnight trade as of 6am, but well off overnight highs on word that Israel had attacked some sites in Iran in promised retribution for the weekend barrage. Oil and wheat prices initially spiked much higher but have since given most of the gains back. Why? Because despite promising they would counter even the slightest attack on their territory with a devastating second-wave, Tehran instead declared that the Israeli attack had "failed" (just as theirs had). It's an unfolding drama that could change again by the time you read this. Supportive news for corn comes from continued cuts in Argentina's corn outlook from both the Buenos Aires Grain Exchange and the U.S. Ag attache down there. It also appears EPA will agree today to "temporarily waive" summer restrictions on E15 sales through September 15 after repeated pleas from several senators to do so in light of ongoing energy security risks stemming from war in the Middle East and Ukraine. The most important news this morning is a host of updates on the long-term weather outlook released yesterday by the Climate Prediction Center. The new forecast for May through July calls for above-normal temperatures across all of the contiguous U.S. aside from a bubble of “equal chances” over the Northwestern Corn Belt/Northern Plains. As for precipitation, most of the country can expected "average" rainfall with the exception of the southeastern quadrant where it should be above normal through July. More interesting was the updated outlook for June ...

Your You/Tube analog gets to know you and tracks podcasts that it thinks that you should see. My chosen one was by David Woo who has been a Wall Street executive and major bank official who now has his own forecasting/investment firm. He lives in Israel and noted that 90% of Israeli's supported finishing Hamas no matter what it took or the geopolitical risk with Iran that it created. They are immersed in the eye for an eye thing and cannot be told when it is time to quit. There is real acrimony and then there are the optics of animosity there. Failure to hit back when attacked leaves the appearance of weakness. Iran's recent drone/missile attack on Israel was in response to one from Israel and was carefully crafted to fit both real acrimony and the optics of animosity necessary in the intended absence of harm and damage that resulted. It was an attack that Iran knew that Israel would thwart. The Saudis, Emirates, and even Jordan assisted in Israel's defense. Israel vowed to respond. Iran said it was 'one and done' but it was not. It immediately began re-supplying missiles to its proxies in preparation for the next attack. No one is willing to get off as the train of reprisals accelerates testing the track. The White House is understandably on edge as to what impact on oil prices that escalation could have. Americans appear super-hyper attuned to the price at the gas pump more than to who ...

On the Grains Grains are mixed yet again in overnight trade, with corn and beans steady to weak but wheat slightly firmer. EIA data out yesterday showed a big drop in weekly ethanol production to a 12-week low and well beyond expectations with stocks declining only marginally. On the brighter side, they also showed gasoline stocks falling more than expected implying stronger demand. This morning we get weekly export sales at 7:30, which could set the tone for early trade. Here are the ranges of expectations: Corn, 300,000 to 900,000 tonnes, Soybeans 300K to 650K, Wheat negative 100K (due to net cancellations) to 200K. Sometime today, the Climate Prediction Center will issue its latest 3-month outlook for May-July and that will give the trade the next reading on yield risks in this growing season. Beyond that, speculation is already beginning on what the May WASDE will show for USDA's first look at the 2024-25 season balance sheets. Then there's the geopolitical uncertainty in the Middle East that has the world on pins and needles. Israel insists it will have to retaliate for the weekend attack while Iran blusters that if there's any encroachment whatsoever onto Iranian assets or territory, they will utterly destroy Israel. The relative quiet we're seeing in the markets is not so much a situation where the price outlook is "stable" as much as situation where events have bulls and bears at a nervous "stalemate". How the big trading funds react is the biggest wild card of all. On the Hogs: Futures closed ...

Brazil's soybean harvest pace is beginning to slow as it nears its conclusion.  We expect Brazil's harvest to reach 90% this week but it may take another month yet to wrap things up completely.  CONAB made a minor adjustment lower to their April soybean production despite finding an additional 140,000 acres by cutting yield a quarter bushel per acre to 48 bpa overall.  This places overall estimates at 146.5 MMT for CONAB while the USDA didn't budge from their March report.  Traders are putting more emphasis on the USDA, pointing out their superior satellite and NDVI technology.   I pointed that out to one trader in Brazil that the USDA has been more accurate in recent years to which he replied, "this time they are wrong."   Even if CONAB and the USDA split the difference, that is still 150+ million bushels removed from Brazil's export supply.   Brazil's exports are the canary in the coal mine.  They are the first to go when there is a lack of supply.  One red flag is that Brazil's soybean exports were down for the month of March compared to last year by 6%.  This would be unusual for the middle of their peak export window if they are supposed to have such a large crop.  March 24 corn exports are off 65% compared to March 23 corn exports.  (And yet the USDA still maintains Brazil's corn production from last season 5 MMT higher than CONAB).  Basis levels are also increasing, with cash prices rebounding 15% from ...

On the Grains Grains are mixed again in overnight trade. There's still no sign of any weather issues with planting, so there is no need to build in any "weather premium" in the minds of traders. That could change tomorrow when the Climate Prediction Center updates its 3-month outlook for May-July. Globally speaking, the only glimmer of supportive news are slightly lower production forecasts for both Ukraine and Russia and ongoing conviction that USDA's estimates for South American soybean and corn crops will inevitably be coming down to more in line with their own estimates down there. Shorter-term, geopolitics and even US politics for that matter are powder kegs of uncertainty that have the U.S. dollar at the highest levels since last fall. The Iranian attack on Israel was a sea change in Tehran's strategy, no longer content to rely on its proxies in the region. For its part, Israel will only say it's going to "respond" and when it does, Tehran says it will strike again. The powder keg in U.S. politics are renewed calls for House Speaker Johnson to resign as he struggles to get support for separate bills to fund new aid for Ukraine, Israel, and Taiwan. It's time for another look at the "big picture" (the monthly charts) for corn and soybeans to get their bearings on "where to from here?" On the corn, we're in a base building zone with $4 the key support and deeply oversold since mid-'23. In soybeans it's a similar situation. The monthly chart has ...