Grains Report 06/12/19
Jack Scoville of The PRICE Futures Group - InsideFutures.com - Wed Jun 12, 1:10PM CDT

DJ USDA Supply/Demand: Crop Summary – Jun 11
U.S. ending stocks in million bushels, except soy oil in million pounds,
cotton in million (480 pound) bales and rice in million cwt. Exports and
Production in million metric tons except cotton in million (480 pound) bales.
Projections based on trends and analysts’ judgments, not survey
date. Source: USDA’s World Agricultural Outlook Board.
======U.S.====== ================WORLD=======================
Ending Stocks Exports Production
19/20 18/19 17/18: 19/20 18/19 17/18: 19/20 18/19 17/18
Soybeans 1,045.01,070.0 438.0:151.05 149.69 152.96:355.39 362.08 341.54
Brazil na na: 75.00 78.50 76.18:123.00 117.00 122.00
Argentina na na: 7.00 7.75 2.11: 53.00 56.00 37.80
China na na: 0.13 0.13 0.13: 17.00 15.90 15.20
Soyoil 1,535 1,950 1,995: 11.75 11.21 10.51: 57.67 56.51 55.17
Corn 1,675 2,195 2,140:169.84 172.80 148.82: 1,099 1,120 1,078
China na na: 0.02 0.02 0.02:254.00 257.33 259.07
Argentina na na: 33.50 34.00 22.50: 50.00 49.00 32.00
S.Africa na na: 1.50 1.00 2.07: 14.00 11.50 13.10
Cotton(a) 6.40 4.65 4.30: 44.75 42.10 41.02:125.32 118.87 123.78
All Wheat 1,072 1,102 1,099:185.40 175.66 181.77:780.83 731.69 761.88
China na na: 1.30 1.20 1.00:132.00 131.43 134.33
EU 27 na na: 26.50 24.00 23.29:153.80 137.22 151.14
Canada na na: 24.00 24.30 21.95: 34.50 31.80 29.98
Argentina na na: 14.00 13.00 12.66: 20.00 19.50 18.50
Australia na na: 13.50 9.00 13.85: 22.50 17.30 20.94
Russia na na: 37.00 36.00 41.42: 78.00 71.69 85.17
Ukraine na na: 19.50 16.20 17.78: 30.00 25.06 26.98
Sorghum 45.0 60.0 35.0: na na na
Barley 90.0 89.0 94.0: na na na
Oats 33.0 33.0 41.0: na na: na na na
Rice 51.6 57.3 29.4: 47.18 46.85 47.12:497.62 499.07

DJ USDA Report: Summary for U.S. Agriculture Supply, Demand Report
WASHINGTON–The following are key numbers from USDA’s crop report Tuesday
and how the government’s estimates compared to analysts’ forecasts in a
Wall Street Journal survey.

U.S. 2019 Corn, Soybean Production, Yield (million bushels, bushels per acre)
Tuesday’s
Estimate Average Range USDA May
Corn Production 13,680 13,903 12,988-14,859 15,030
Soybean Production 4,150 4,092 3,860-4,240 4,150
Tuesday’s
Estimate Average Range USDA May
Corn Yield 166.0 * 170.3 162.5-175.0 176.0
Soybean Yield 49.5 * 48.7 47.5-49.6 49.5
***
U.S. Stockpiles (million bushels)
2018-19
Tuesday’s
Estimate Average Range USDA May
Corn 2,195 2,165 2,035-2,485 2,095
Soybeans 1,070 1,010 920-1,079 995
Wheat 1,102 1,113 1,077-1,128 1,127
2019-20
Tuesday’s
Estimate Average Range USDA May
Corn 1,675 1,731 1,133-2,404 2,485
Soybeans 1,045 987 825-1,346 970
Wheat 1,072 1,115 1,025-1,180 1,141
***
World Stockpiles (million metric tons)
2018-19
Tuesday’s
Estimate Average Range USDA May
Corn 325.4 323.6 314.0-328.4 325.9
Soybeans 112.8 113.1 107.4-115.4 113.2
Wheat 276.6 274.6 272.1-276.0 275.0
2019-20
Tuesday’s
Estimate Average Range USDA May
Corn 290.5 301.6 285.0-315.0 314.7
Soybeans 112.7 114.7 108.0-136.2 113.1
Wheat 294.3 288.2 276.4-293.0 293.0
***
2019-20 Wheat Production (million bushels)
Tuesday’s
Estimate Average Range USDA May
All Wheat 1,903 1,891 1,837-1,952 1,897
Winter Wheat 1,274 1,255 1,194-1,316 1,268
Hard Red Winter 794 766 662-816 780
Soft Red Winter 258 263 252-286 265
White Winter 222 228 215-252 224
***
2018-2019
Brazil Production (million metric tons)
Tuesday’s
Estimate Average Range USDA May
Corn 101.0 99.8 96.0-102.0 100.0
Soybeans 117.0 117.0 116.0-118.0 117.0
Argentina Production (million metric tons)
Tuesday’s
Estimate Average Range USDA May
Corn 49.0 49.0 48.0-50.0 49.0
Soybeans 56.0 56.1 55.5-57.0 56.0

WHEAT
General Comments: Wheat markets were higher as uncertain growing conditions around the world continued. Chicago was the upside leader, implying big speculative buying interest. USDA showed increased production in its reports yesterday, with most of the gains coming in HRW areas. However, it showed even stronger demand, with USDA showing increased feed use due to reduced Corn production. The end result was lower ending stocks projections, although the ending stocks projections remain very high. The best precipitation in years for the Great Plains is behind the increased production. It also means that protein levels will not be real high, so using the Wheat for feed in many cases will make a lot of sense. Spring Wheat values were most stable yesterday even with more reports of dry weather for planting in the western Canadian Prairies and reports of hot and dry weather in Russia and into eastern Ukraine. Production estimates for Russia have started to drop and world prices have started to firm. The situation in Canada is having more to do with the recent strength in Minneapolis as much of the Canadian Spring Wheat is hedged in that market. The dry weather in Canada has made for easier planting but poor emergence. Questions about yield potential are starting to increase. Forecast rains were disappointing in the Prairies. Egypt bought 120,000 tons of Romanian and Russian Wheat yesterday.
Overnight News: The southern Great Plains should get frequent precipitation today and at the end of the week. Temperatures should be above normal. Northern areas should see light to moderate precipitation today and at the end of the week. Temperatures should be near o above normal. The Canadian Prairies should see dry conditions through Thursday, then scattered showers. Temperatures should be near to above normal.
Chart Analysis: Trends in Chicago are mixed to up with objectives of 527, 555, and 557 July. Support is at 513, 508, and 502 July, with resistance at 522, 529, and 535 July. Trends in Kansas City are mixed. Support is at 454, 445, and 444 July, with resistance at 461, 463, and 474 July. Trends in Minneapolis are mixed to up with objectives of 584, 591, and 616 July. Support is at 560, 556, and 551 July, and resistance is at 572, 576, and 581 July.

RICE
General Comments: Rice was lower in reaction to the USDA reports and forecasts for drier weather for the rest of this week. USDA made no real changes to the old crop data but showed decreased production and demand potential for the new crop. The reduced production should have been positive for prices as ending stocks for next year will also be reduced even with reduced demand. But, there was no real buying interest even in response to the price positive news in the reports. World supplies increased, and this kept some of the buying interest out of the market. The weather remains difficult for producers. Some of the producers in Mississippi, Arkansas, and southern Missouri will stop trying to plant Rice and will try to plant Soybeans instead. Demand for US Rice in the world market has not been all that strong lately, but sales in the western hemisphere are continuing. World prices have been firming lately so this should help the US.
Overnight News: The Delta should get scattered showers again over the weekend. Temperatures should above normal.
Chart Analysis: Trends are mixed. Support is at 1146, 1138, and 1136 July, with resistance at 1168, 1179, and 1183 July.

CORN AND OATS
General Comments: Corn and Oats were higher in reaction to the USDA reports. USDA cut Corn planted area by 3 million acres and corn yields by 10 bushels per acre and produced a significantly smaller production projection of 13/.680 billion bushels. Demand was cut for the coming year in the feed and export categories, but ending stocks were still sharply lower at just over 1.6 billion bushels. It was a bullish surprise to the market as USDA has never really made big modifications in the June reports. The moves also imply that USDA can further cut planted area and yields in coming reports. Funds were reported to be massive buyers on the news, and trends started to turn up again on the daily charts. Producers with old crop supplies should consider moving these supplies on the rally, and some might want to start selling new crop supplies as well. However, the dynamics of the market have changed and higher prices seem all but certain as the calendar moves forward.
Overnight News:
Chart Analysis: Trends in Corn are mixed to up with objectives of 447, 474, and 484 July. Support is at 421, 416, and 412 July, and resistance is at 431, 436, and 438 July. Trends in Oats are mixed. Support is at 301, 298, and 296 July, and resistance is at 307, 310, and 313 July.

SOYBEANS AND PRODUCTS
General Comments: Soybeans and products were a little higher in response to the USDA reports. USDA made no real changes to US new crop estimates and cut export demand for the old crop estimates as the export sales pace has been slower than expected. It increased South American production estimates but this was expected. However, the USDA reports pushed Corn and Wheat higher and Soybeans held and closed on a firm note in sympathy with the grains. USDA will probably show an increase in Soybeans planted area in reports later this Summer due to the prevented planting of Corn. The potential for more Soybeans planted area is especially good in the eastern Midwest where yield potential is higher. The trade is also worried about a permanent loss of demand from China due in part to the Swine Flu there and in other parts of Southeast Asia and the trade war with China. This is also happening, and Swine Flu is being reported now in Europe as well as Asia. China has continued to buy US pork meat as it needs meat in a big way due to the Swine Flu. It is also making deals to buy from just about everyone else as the demand is going to be big enough to demand imports from all corners of the globe. The Brazilian Real has firmed in the last few weeks and is now less than 4:1 against the US Dollar. The Real was higher again yesterday.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 849 and 819 July. Support is at 848, 838, and 831 July, and resistance is at 864, 866, and 874 July. Trends in Soybean Meal are mixed to down with objectives of 308.00 y 296.00. Support is at 310.00, 309.00, and 305.00 July, and resistance is at 316.00, 321.00, and 323.00 July. Trends in Soybean Oil are mixed. Support is at 2700, 2670, and 2620 July, with resistance at 2760, 2790, and 2800 July.

CANOLA AND PALM OIL
General Comments: Canola was a little higher along with Chicago and on weather concerns in Canada. Support still comes from reports of dry weather in Canada and Saskatchewan is the driest province. Demand remains light in the domestic market and the export market. There is hope for increased demand from China as that country bought about double its normal amount of Canadian Wheat last month. Palm Oil was lower on demand ideas and as traders prepare for the MPOB reports. Bearish data was expected It has been a tough time getting Soybeans planted in the US and this is supporting Palm Oil. Demand ideas are improving on ideas China on increase buying, but ideas are that production remains high. Short term trends are trying to turn up.
Overnight News:
Chart Analysis: Trends in Canola are mixed. Support is at 452.00, 449.00, and 446.00 July, with resistance at 459.00, 462.00, and 464.00 July. Trends in Palm Oil are mixed. Support is at 1990, 1960, and 1930 August, with resistance at 2030, 2070, and 2090 August.

Midwest Weather Forecast: More precipitation in all areas by the middle of the week and again this weekend. Temperatures should be near to below normal.

US Gulf Cash Basis
Corn HRW SRW Soybeans Soybean Meal Soybean Oil
June +56 July +162 July +80 July +54 July +1 July
July +48 July +80 July +45 July
August +37 September +75 September +35 August
All basis levels are positive unless noted as negative

Brazil Premiums Soybeans Soybean Meal Soybean Oil Corn
Paraguay Paraguay Paraguay Santos
June
July 125 July 38 July
August 125 August -8 August 28 September

DJ ICE Canada Cash Grain Close – Jun 11
WINNIPEG — The following are the closing cash
canola prices from ICE Futures.
Source: ICE Futures

Price Change
CANOLA
*Par Region 444.40 up 1.40
Basis: Thunder Bay 467.40 up 1.10
Basis: Vancouver 475.50 up 1.10
All prices in Canadian dollars per metric tonne.
*Quote for previous day
Source: Commodity News Service Canada
(news@marketsfarm.com, 204-414-9084)

DJ Malaysian PM Cash Market Prices for Palm Oil – June 12
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Wednesday applied by commodity broker Matthes & Porton Bhd.
Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.
Refined, bleached and deodorized palm oil, FOB, Malaysian ports
Offer Change Bid Change Traded
Jun 505.00 -05.00 Unquoted – –
July 505.00 -05.00 Unquoted – –
Aug/Sep 507.50 -07.50 Unquoted – –
Oct/Nov/Dec 515.00 -05.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Jun 510.00 -05.00 Unquoted – –
July 510.00 -05.00 Unquoted – –
Aug/Sep 512.50 -07.50 Unquoted – –
Oct/Nov/Dec 520.00 -05.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Jun 467.50 -07.50 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Jun 400.00 -02.50 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jun 1,980 -20.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Jun 134 -02.00 Unquoted – –
($1=MYR 4.1585)

DJ China Dalian Grain Futures Closing Prices, Volume – Jun 12
Soybean No. 1
Turnover: 150,018 lots, or 5.23 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jul-19 3,465 3,489 3,428 3,430 3,470 3,431 -39 122 606
Sep-19 3,506 3,514 3,455 3,462 3,511 3,488 -23 133,118 121,696
Nov-19 3,446 3,457 3,434 3,457 3,464 3,444 -20 8 128
Jan-20 3,493 3,504 3,456 3,458 3,495 3,483 -12 14,152 41,178
Mar-20 3,472 3,472 3,471 3,471 3,476 3,471 -5 10 36
May-20 3,553 3,561 3,523 3,525 3,555 3,540 -15 2,608 18,978
Corn
Turnover: 818,994 lots, or 16.20 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jul-19 1,921 1,925 1,910 1,914 1,922 1,916 -6 7,948 64,098
Sep-19 1,962 1,970 1,953 1,957 1,966 1,960 -6 577,802 1,002,626
Nov-19 2,001 2,003 1,989 1,992 2,001 1,993 -8 87,584 288,780
Jan-20 2,031 2,037 2,023 2,026 2,036 2,028 -8 126,412 501,606
Mar-20 2,058 2,058 2,041 2,046 2,054 2,048 -6 1,796 9,492
May-20 2,101 2,107 2,093 2,098 2,104 2,099 -5 17,452 50,320
Soymeal
Turnover: 3,130,070 lots, or 89.63 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jul-19 2,817 2,818 2,767 2,800 2,789 2,797 8 12,580 15,290
Aug-19 2,849 2,864 2,821 2,843 2,860 2,846 -14 97,482 164,916
Sep-19 2,873 2,886 2,841 2,863 2,871 2,864 -7 2,583,168 1,958,564
Nov-19 2,908 2,911 2,872 2,898 2,903 2,894 -9 568 7,614
Dec-19 2,902 2,955 2,866 2,894 2,891 2,892 1 11,160 900
Jan-20 2,914 2,925 2,877 2,905 2,908 2,903 -5 332,462 398,914
Mar-20 2,830 2,836 2,801 2,822 2,817 2,816 -1 68 1,118
May-20 2,708 2,723 2,691 2,702 2,700 2,706 6 92,582 207,886
Palm Oil
Turnover: 618,080 lots, or 27.08 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jun-19 – – – 4,076 4,076 4,076 0 0 0
Jul-19 – – – 4,414 4,414 4,414 0 0 18
Aug-19 4,416 4,416 4,342 4,342 4,466 4,378 -88 4 2
Sep-19 4,402 4,402 4,340 4,344 4,394 4,366 -28 569,046 623,668
Oct-19 – – – 4,494 4,494 4,494 0 0 14
Nov-19 4,600 4,600 4,448 4,448 4,598 4,530 -68 30 22
Dec-19 – – – 4,484 4,550 4,484 -66 0 12
Jan-20 4,556 4,564 4,514 4,520 4,552 4,538 -14 48,756 126,678
Feb-20 – – – 4,604 4,618 4,604 -14 0 4
Mar-20 – – – 4,754 4,754 4,754 0 0 12
Apr-20 – – – 4,662 4,676 4,662 -14 0 2
May-20 4,734 4,744 4,700 4,702 4,732 4,718 -14 244 6,058
Soybean Oil
Turnover: 452,046 lots, or 24.64 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Jul-19 5,454 5,470 5,370 5,470 5,462 5,420 -42 8 2
Aug-19 – – – 5,402 5,402 5,402 0 0 32
Sep-19 5,474 5,480 5,400 5,408 5,460 5,432 -28 400,048 767,328
Nov-19 – – – 5,516 5,516 5,516 0 0 2
Dec-19 5,676 5,676 5,510 5,510 5,628 5,588 -40 24 50
Jan-20 5,628 5,632 5,558 5,562 5,610 5,588 -22 50,940 161,948
Mar-20 – – – 5,634 5,634 5,634 0 0 12
May-20 5,718 5,718 5,646 5,646 5,696 5,670 -26 1,026 10,832
Notes:
1) Unit is Chinese yuan a metric ton;
2) Ch. is day’s settlement minus previous settlement;
3) Volume and open interest are in lots;
4) One lot is equivalent to 10 metric tons.