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2yrs ago Managed Futures blog.pricegroup Views: 425

WHEAT
General Comments: Wheat markets were sharply lower in response to the USDA WASDE reports and as trends started to turn down on the daily charts. The reports showed less demand to go with less production. Minneapolis held better as production forecasts are less for Spring Wheat. The dry weather in other parts of the Great Plains did not appear to make much difference to Winter Wheat production and yields. Scattered showers are in the forecast for this week in western Texas. Dry conditions remain in the northern Great Plains and Canadian Prairies. Kansas also got some beneficial precipitation over last weekend and this week. Wheat remains a weather market, but the demand side has been weak. Demand remains disappointing but the production might not be there for better demand in the coming year. Corn prices are high so demand for feed wheat could increase.
Overnight News: The southern Great Plains should get isolated to scattered showers. Temperatures should be near to below normal. Northern areas should see scattered showers this weekend. Temperatures will be near normal. The Canadian Prairies should see isolated showers. Temperatures should average near to above normal.
Chart Analysis: Trends in Chicago are down with objectives of 666 and 608 July. Support is at 691, 683, and 680 July, with resistance at 712, 724, and 745 July. Trends in Kansas City are down with objectives of 636 and 578 July. Support is at 651, 642, and 626 July, with resistance at 683, 705, and 722 July. Trends in Minneapolis are mixed to down with objectives of 696 and 638 July. Support is at 728, 724, and 710 July, and resistance is at 745, 758, and 774 July.

RICE
General Comments: Rice prices were sharply lower on what appeared to be follow through speculative selling due to forecasts for increased precipitation and warmer temperatures for US growing areas. The USDA WASDE reports released on Wednesday were considered neutral to negative for the trade. Rice areas have generally been wet although some parts of Texas could use a little rain. Louisiana is saturated. Temperatures have been cold, especially in Arkansas but the crop has been getting planted and is emerging, anyway. The cash market is working through PL-480 tenders for milled Rice. Texas and Louisiana are almost out of Rice, but there is Rice available in the other states, especially Arkansas. Asian and Mercosur markets were steady to lower last week. New crop months were a little higher but July was the real mover. Mississippi and Arkansas are actively planting around the rains.
Overnight News: The Delta should get some big rains. Temperatures should be near to above normal.
Chart Analysis: Trends are down with objectives of 1332 and 1264 July. Support is at 1348, 1315, and 1304 July, with resistance at 1395, 1413, and 1425 July.

CORN AND OATS:
General Comments: Corn closed sharply lower to limit fdown in response to the USDA WASDE reports released on Wednesday and news that the Mississippi River was closed at Memphis. A bridge over the river cracked and barges were not able to pass under the bridge. Ideas are that the closing will last only a few days but the market is worried about a longer closure and the possible effects on river shipping. In fact, the govvernment announced this morning that the bridge was being opened to barge traffic again. Export sales were poor yesterday for old crop Corn. USDA estimated less demand in its Wednesday reports for the coming year than the trade had expected. USDA expects increased competition from the Black Sea and did not cut Brazil Corn production as much as the trade has figured. The supply side showed slightly less production than the trade had anticipated but the overall effect was for higher than expected ending stocks estimates. Western sections of the Midwest got crops planted with speed, but eastern areas were slower. Emergence has been about average in all areas. Emergence has been slow due to cold temperatures. Temperatures will be cooler this week and there will be precipitation to keep farmers from the fields. Overall planting conditions should be fairly good over the next week. There are also concerns about the production potential for the Safrinha crop in Brazil as growing areas have been warm and dry and look to stay that way longer term. Reports indicate that crops are being stressed due to the lack of rain. It is drier in central and parts of northern Brazil. The Winter Corn crop progress is well behind normal and it has been dry in major growing areas. There are worries that US Corn is priced out of the world market as US Corn is the highest price of any offering nation, but the lack of production of the second crop in Brazil should mean stronger demand for US Corn. Demand for US Corn has been coming at a stronger pace than estimated by USDA and it looks like US ending stocks can be significantly less than current projections by the end of the year. Demand for ethanol production should increase as people in the US get vaccinated and start to drive again.
Overnight News: China bought 1.360 million tons of US new crop Corn.
Chart Analysis: Trends in Corn are mixed to down with objectives of 672 July. Support is at 674, 663, and 650 July, and resistance is at 703, 716, and 752 July. Trends in Oats are down with objectives of 355 July. Support is at 363, 357, and 351 July, and resistance is at 383, 400, and 410 July.

SOYBEANS
General Comments: Soybeans and the products closed lower in response to the WASDE reports released on Wednesday and on news that the Mississippi River was closed at Memphis. The reports showed strong demand for bio fuels moving forward. Production was a little less than expected but so was demand. Ending stocks were a little higher than expected but still very tight. Estimates for this year were unchanged. A bridge over the river cracked and barges were not able to pass under the bridge. Ideas are that the closing will last only a few days but the market is worried about a longer closure and the possible effects on river shipping. In fact, the government announced that the bridge would be reopened to barge taffic today. Commercials are thought to be the best buyers. The recent rally has been led by demand amid a very tight stocks situation here in the US. There is still crush demand and export demand even though the demand is less now than before and the market thinks the US is going to run out of Soybeans unless demand can be rationed with high prices. Some of that rationing is going on as US prices are much above offers from South America. The US does not have a lot of Soybeans in the country anymore as most producers have already sold. Buyers are scrambling for what is left. Brazil is rapidly exporting Soybeans.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to up with objectives of 1728 July. Support is at 1575, 1563, and 1554 July, and resistance is at 1615, 1645, and 1667 July. Trends in Soybean Meal are mixed. Support is at 420.00, 417.00, and 415.00 July, and resistance is at 425.00, 430.00, and 433.00 July. Trends in Soybean Oil are mixed to up with objectives of 6790 July. Support is at 6460, 6300, and 6200 July, with resistance at 6740, 6800, and 6860 July.

CANOLA AND PALM OIL
General Comments: Palm Oil was closed for Eid. Supplies in Indonesia are likely to increase this year according to the government there. The private sources showed that export demand is running ahead of last month so far this month, but the market fears the loss of Indian demand due to the big Coronavirus outbreak there. Ideas of tight supplies are still around but MPOB did show higher than expected ending stocks in its March data. Canola was sharply lower in all months and was weakest in July as demand is feared to be less because of a strong Canadian Dollar but as new crop concerns continued despite improved growing and planting conditions. Worries about South American production are supporting both markets as is dry weather in the Prairies. Demand is thought to be OK with crush margins favoring a lot of production of vegetable oils to feed the demand but less exports. The demand for bio fuels is about to increase and is one reason to see much stronger Soybean Oil and Canola prices.
Overnight News:
Chart Analysis: Trends in Canola are down with no objectives. Support is at 855.00, 832.00, and 808.00 July, with resistance at 885.00, 902.00, and 944.00 July. Trends in Palm Oil are up with objectives of 4590 July. Support is at 4400, 4280, and 4230 July, with resistance at 4520, 4580, and 4640 July.

Midwest Weather Forecast: Scattered showers to the south. Temperatures should average below normal.

 


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