Headlines:
- cereal futures rally ahead of US plantings forum
It was wheat futures turn to feel the benefit of export demand, as futures in Chicago bounced back on bargain buying.But prices for soybeans remain under pressure, as the Brazilian soybean harvest continues apace.
Markets are readying themselves for Thursdays US Department of Agriculture’s outlook forum, which will shed light on US farmer planting intentions.
- Soft commodities better bets than grains, says Goldman Sachs
Soft commodities look better bets than grains, according to Goldman Sachs, which flagged the potential for firm demand to lift prices of cocoa and coffee, while record output dents corn and soybean futures. The bank – while cutting its price hopes for New York cocoa futures by $400 a tonne across the board – was more sanguine than investors, seeing values at $2,200 a tonne in a year’s time, compared with the $2,071 a tonne that the March 2018 contract was trading at on Wednesday. Goldman acknowledged that weather conditions in West Africa, the major cocoa-growing region, had been “very supportive of yields”, with the region suffering only a “very mild” iteration of the Harmattan wind – unlike a year ago.
Summary:
The price action was mixed and generally uneventful today. May Corn was only up 1.25 cents, July Wheat found support above our 462 level yesterday and closed at 470.50 today after a gain of 6.25 cents. May Beans was under pressure closing essentially at the lows of the day, giving up 4 cents. A 2nd round of adjustment to Corn exports was reported today. The was a big reduction correction yesterday followed by a cancellation today. In all, about 400k tons were erased over the last 2 days. For now, many market participants have their sights on tomorrow’s USDA outlook forum. The USDA will be releasing acreage estimates for the upcoming planting season.
That forum, which is the USDA’s largest annual meeting, will convene this week in Arlington, VA without the AG Secretary for the 1st time in 22 years. Key players in the government have taken to obstructionist tactics in efforts thwart any would be successful efforts of the new elected president. The Agricultural Outlook Forum will spotlight the US House Agriculture Committee Chairman Mike Conaway as the keynote speaker Thursday and Zippy Duval, American Farm Bureau Federation President, as the distinguished dinner speaker.
