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MARKET TREND Higher: CN,Up 2, SN, Up 5, WN, Up 10

May 17, 2018 07:09 AM

Basting, Brian BBasting@advance-trading.com

Attachments6:25 AM (42 minutes ago)
 
to Morning
 
 
 
 
 
 
 
 
 

HIGHLIGHTS

  • MARKET TREND—Higher: CN, +$.0225; SN, +$.0625; WN, +$.1025; KWN, +$.1175. 
  • MACRO:  Global stocks are mixed as investors digest a mixed bag of economic reports from strong U.S. factory orders to weak machinery orders in Japan.  Asia—Mostly Lower: Nikkei, +0.53%; Shanghai, -0.48%; Hang Seng, -0.54%.  EUROPE: Higher: DAX, +0.20%; FTSE, +0.12%; CAC, +1.06%.  WALL STREET: Futures are weaker: DOW, -33; S&P, -5.50; NAS, -28.75.  EXTERNALS: June crude: +$0.56 @ $72.05; Aug Gold: -$2.54 @ $1,287; $ Index+.139 @ 93.430

·       T-storm Weather: A large system produces heavy rain within northwest third of central U.S. over Fri.-Sun. (1.25"-2.50"), while a separate system produces significant rain in eastern areas of Corn Belt/Delta over same period (1.00"-1.50"), & heart of Corn Belt stays fairly dry until Sat.-Sun. when scattered thunderstorms produce 0.25"-0.75".  Best rain chances for wettest areas of/near northern IL & WI hold until Sun.-Mon., but potentially affect Michigan & far-northern areas of IN & OH starting Sat. morning

·       CN, up $.0225 @ $4.015; CU, up $.0275 @ $4.1025.  The funds sold 5 K yesterday                      

  • SN, up $.0625 @ $10.06; SQ, up $.0625 @ $10.095. Funds: Sold 15 SB, 6 SBM & 7 SBO.
  • WN, up $.1025 @ $5.045; WU, up $.0925 @ $5.195.  Fund buying: 2 K                              

CORN/SORGHUM

·​;       Export Sales to be released at 7:30 am CDT.  Trade expects 28-39 mbu for 17/18 corn

  • T-storm Weather: A strong cool front produces 0.75" to 1.50" of rain within the southern ~30% of second-crop (safrinha) corn in Brazil Fri.-Sat., and 0.25" to 0.75" elsewhere
  • Consultant: Forecasted rainfall this weekend across safrinha corn in Brazil is expected to stop crop losses from getting worse; however, the losses are irreversible and the rains are coming too late for any meaningful recovery        

·       Ethanol grind: Total of 1,058,000 barrels/day for week end May 11—up 18 thou v. prior week & 3.0% above last year

SOYBEANS/WHEAT

·       Export Sales report.  Trade expects 11-22 mbu for 17/18 soybeans; soymeal, 100-300 K MT; soyoil, 10-40 K MT 

·       ATI Research: Latest projections peg China’s Oct-July soybean imports from all origins up just 1.6 MMT vs. last year.  This increase the likelihood that Oct-Sep imports will fall 1.0 MMT or so short of the USDA’s 97.0 MMT forecast

·       T-storm Weather: In the U.S., we continue to forecast rain next week (May 21-26) across a fairly wide area with highest totals in heart of the Corn Belt.  Temperatures will be warmer than normal across a wide area

·       Export Sales report.  Trade expects 0-7 mbu for 17/18 all wheat and 4-11 mbu for 18/19

  • T-storm Weather: Most U.S. HRW wheat to benefit from rain through Sunday, range is 0.50”-1.00”; heaviest north

ENERGY

·       Mixed: CLM18+$.56 @ $72.05; EBN, +$.62 @ $79.90; EBN-QCLN, +$0.50RBM,+.0092NGM, -.008HOM, -.0180

·       On Wednesday, cash ethanol markets were lower: Chicago was quoted at $1.4475, down $0.02; Basis to Chicago—New York, +13 ¼; Gulf, +11 ¾; Dallas, +5 ¼; Tampa, +17 ¾; and LA, +24 ¾

·       On Wednesday, ethanol RINs declined: 2017’s eased 1 ½ to 26-27; and 2018’s fell 1 to 32-33

·       The June RBOB/June ethanol spread widened by $.0651 yesterday to +$.77890/gallon

  LIVESTOCK/POULTRY          ​                     &nbs​p;     

  • Choice boxed beef values were 61-cents lower on Wednesday at $231.03, but are still up 7-cents vs. a week ago
  • Light cash cattle trade was seen Wed. in the South with prices pegged at $115-$116, which is $6-$7 lower v. last week
  • USDA mandatory pork carcass cutout value eased 8-cents on Wed. to $73.30, but is still up $2.09 vs. last week
  • CME Lean Hog Index increased $0.91 on Wed. to $66.14.  June futures gained $1.175 and are $9.76 above the index

Sources: Bloomberg, Dow Jones, AP, DTN, T-storm Weather

 



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