Written Commentary
Ag Market View for October 29.24
October 29, 2024
by Steve Freed,
Grain futures are mixed. SN is up 6 cents near 8.45. CN is up 1 cent and near 3.20. WN is down 3 cents and near 4.96.
China has asked trading firms and food processors to boost inventories of grains and oilseeds as a possible second wave of coronavirus cases and worsening infection rates elsewhere raise concerns about global supply lines. Both state-run and private grain traders as well as food producers were urged to procure higher volumes of soybeans, soyoil and corn during calls with China’s Ministry of Commerce in recent days, three trade sources told Reuters. “There is a possibility of a breakdown in supply pipelines due to the coronavirus infections. For example, a port of origin or destination might shut down,” said a senior trader at one of China’s leading food processors, which was on a call last week with authorities to discuss purchases.
Soybean futures could be in a broad trading range between 7.75 and 9.00. Support is from feelings that China will be a net buyer of US soybeans. This despite increase tension between POTUS and China. Prospects of a large US 2020 crop followed by another large 2021 South America crop could limit gains. US soybean planting pace should be near 62-68 pct done. Rains are falling across parts of the US east Midwest.
July corn futures continue to trade in a range between 3.00-3.40. Drop in ethanol demand has raised US 2019/20 carryout and could increase final US 2020/21 carryout. Slow increase in US gasoline demand and reopening of a few US ethanol plants could support prices. Still US farmer has a large amount of corn to sell on rallies. Corn will need a weather problem to rally over resistance. US corn planting is estimated near 79-83 pct with early crop ratings above average.
Lower Russian July-August wheat prices weighed on wheat futures last week. Talk of dryness across parts of Europe and Black Sea and US south plains could support futures. Sharp drop in World production or pick up in World trade is needed to push prices higher.
CFTC estimated Managed funds are net long 3,000SRW Wheat (-1,000); net short 214,000 Corn +24,000); net long 32,000 in Soybeans (+23,000); net short 11,000 lots of Soymeal (-1,000), and; net short 8,000 Soyoil (+1,000).
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