|Day's Range||282.00 - 286.90|
Another year of plenty supplies across the three major crops are being projected by the U.S. Department of Agriculture in their latest outlook. Only a deteriorating weather outlook over the coming months or a pickup in U.S. export sales – unlikely given the strong dollar – can prevent stocks building following another bumper harvest in the U.S. and around the world.
Organic soybean planting is likely to rise related to organic corn planting during the coming harvest according to The Jacobsen. This is because the average value per acre for organic corn has declined substantially relative to the value per acre for organic soybeans. The relative value is measured by The Jacobsen Planting Acre Index.
Investors who are looking for ways to diversify a traditional investment portfolio can turn to alternative assets like commodities and related exchange traded funds.
The Chinese regulator has asked commercial banks to halt new sales of a wide range of wealth management products that might lead to unlimited losses for investors, two sources told Reuters. At the weekend, China Banking and Insurance Regulatory Commission (CBIRC) gave verbal instructions to banks to halt new sales of products that could trigger open-ended losses for investors, and requested reports on the outstanding size of related products, according to two direct sources who are familiar with the matter. CBIRC's move came nearly a week after heavy losses were recorded in a crude oil futures trading product sold by the country's fourth-largest lender, Bank of China (BoC).
U.S. rail volumes for grain are facing ongoing headwinds in both the international and domestic markets, with factors such as a strong U.S. dollar and competition from other grain-producing countries weighing on export-bound volumes, while the coronavirus pandemic is putting pressure on domestic volumes, according to grain industry observers."The railroads are going to really struggle with what's the forecast and with what [grain and soybean producers are] going to be delivering," said Mike Steenhoek, executive director of the Soy Transportation Coalition. "Obviously, it's very uncertain, but they've got a number of dynamics that are happening that are producing these significant headwinds." On the export side, U.S. grain exports are facing fierce competition from South America and the Black Sea region, as well as disrupted trade with China, according to agricultural consultant Jay O'Neil. These factors are hurting agricultural grain prices and railroads' profitability.The COVID-19 pandemic has also slowed U.S. grain exports between the U.S. and China, O'Neil said. Grain export activity was expected to increase following the first round of the U.S.-China trade agreement that both countries signed earlier this year. "I am not hearing, nor am I aware of, any problematic issues with rail service in the U.S., at least not from the shippers side," said O'Neil. "The railroads do have their concerns about reduced incoming intermodal volumes due to COVID-19 and, on the grain side, the drop in U.S. exports."Brazil has exported "significant" volumes of soybeans, predominantly to China, since this time of year is the height of exports for the South American country, Steenhoek said. The season for U.S. exports typically starts in the fall.But the U.S. dollar has also strengthened as people worldwide flock to more stable currencies amid the global economy uncertainty, Steenhoek said. This in turn makes U.S. grain exports more expensive compared with grain exports from other countries, such as Brazil, he said."What will really be the tell-tale sign of our export strength will be later this year, when our harvest comes online. So, that's what people really are gearing up. But in the interim, those headwinds do exist," Steenhoek said.In its monthly worldwide grain estimates report last week the U.S. Department of Agriculture (USDA) lowered its outlook for U.S. wheat exports and domestic use, while increasing its volume estimates for U.S. wheat stocks. The agency lowered its 2019-2020 wheat export outlook by 15 million bushels to 985 million bushels "on a slowing pace and prices that have become uncompetitive in many international import markets," according to the World Agricultural Supply and Demand Estimates April 9 report.USDA also raised its estimates for ending stocks of U.S. corn to 2.09 billion bushels from its March estimate of 1.89 billion bushels.As for domestic grain volumes within the U.S., the COVID-19 pandemic has increased demand for agricultural products such as eggs and soybean meal for livestock, but it has also caused restaurants to reduce their food purchases significantly, Steenhoek said.Meanwhile, the drop in crude oil prices has slashed U.S. ethanol production, since the price of ethanol tracks closely with the price of crude. Since corn is used to produce ethanol, corn prices in turn have fallen, and farmers are trying to figure out their planting intentions for the year, Steenhoek said. "All of a sudden you have this dramatic decrease in the corn market, and that's really causing some turmoil in the industry," he said.Grain producers might be able to shift some percentage of their farming operations from corn to soybeans or another grain, but producers typically don't have the ability to alter their operations considerably because "Once you have your land a certain way, all of your inputs a certain way, your machinery a certain way, you don't have that ability to just pivot on a dime," Steenhoek said."The only good news from the shippers' side of the coin is that the drop in cargo volumes means there is plenty of rail capacity at the ready to serve the upcoming harvest needs. I'm sure the railroads are saying, bring it on," O'Neil said.While U.S. grain exports are facing a strong U.S. dollar and competition from other countries, Canadian grain exports have been steady, following the rail blockades of February. The COVID-19 pandemic also doesn't appear to have a material impact on Canadian grain exports, according to Wade Sobkowich, executive director of the Western Grain Elevator Association.Grain producers and truck drivers have been subject to the same safety and sanitation protocols, including maintaining distances of two meters between workers, sometimes resulting in truck drivers being asked to remain in their truck as grain elevator staff bring the delivery receipt to the truck, Sobkowich said.But "in spite of all these measures (and perhaps because of them to a certain degree), grain has been flowing well and as long as everyone involved in the supply chain can keep their employees healthy and working, we do not anticipate significant problems," Sobkowich said. "The federal government and the provinces have deemed grain/food and supply chains as essential services and, although there will be issues we will have to work through, our intention is to keep grain moving during this pandemic," he said. U.S. grain carloads (RTOGR.USA) and Canadian grain carloads (RTOGR.CAN) over the past year. Source: SONARImage: Flickr/Mick HallSee more from Benzinga * How A Hog Plant Shutdown Hits Freight – Coronavirus Freight Market Update (With Vdeo) * This Week In SONAR: API Upgrade Allows Subscribers To Digest Rates Into Their Own Workflows * TT Club Loads Evidence In Cargo Security Push(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Investors say there’s no one chart that will signal when the stock-market bottom is in. But technical analyst Chris Kimble is keeping his eye on a commodity index that is testing a very important level of support.
U.S. corn futures fell more than 1% on Monday on slowing grain demand from ethanol makers, as tightening coronavirus pandemic travel restrictions limited demand for the biofuel. Soybeans ended mixed, with nearby contracts lifted by firm soymeal prices and concerns coronavirus restrictions may impede South American soy shipments. Wheat ended mostly higher as top exporter Russia appeared poised to restrict shipments.
Indian farmer Banwarilal Bhardwaj was planning to buy a car after harvesting his winter-sown crops that were promising bumper returns. "If prices fall any further, I'll struggle to even repay the loan," Bhardwaj said. With more than 263 million farmers, the health of India's farm sector can have a significant impact on the economy.
Malaysian palm oil futures rose more than 1% on Monday after two straight sessions of losses, as data from an industry body showed a decline in output in the world's second-biggest producer. The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange rose 1.1% to 2,631 ringgit per tonne in early trade. The contract fell nearly 9% last week on fears that the coronavirus epidemic would lower demand from China, the world's second-biggest buyer of the vegetable oil.
Declining production and rising demand should push palm oil prices higher in the coming months, outweighing current fears about a virus outbreak in China that fuelled a sell-off in recent days, Oil World said on Friday. Global palm oil output is expected to decline by 1 million tonne in the 2019/2020 season, putting the market on course for a second successive annual supply deficit, Thomas Mielke, head of the Hamburg-based analyst firm said. Tightening supply had already triggered a rally in palm oil prices in the last quarter of 2019 before concern over the impact of a spreading coronavirus in China and moves by India to curb imports of Malaysian palm oil fuelled a pullback since mid-January.
Commodity prices and related exchange traded funds could catch a tailwind from a weakening U.S. dollar. Commodities have been weighed down by an appreciating U.S. dollar, but now, some banks are projecting ...
The signing of the Phase One trade pact between the U.S. and China on Wednesday is a clear positive for ocean shipping demand. China is committed to buying $77.8 billion in U.S. manufactured products over the next two years, which is good for the container sector; $32 billion in agricultural products, a plus for dry bulk shipping; and $52.4 billion in energy exports, which should support tankers carrying crude oil, liquefied petroleum gas (LPG) and liquefied natural gas (LNG). Increased volumes from the U.S. would likely lead to reductions from other countries.
A coalition of US farmers traveled to the UN’s COP25 summit in Madrid to make the case for the role that large-scale farming can play in addressing climate change.
Malaysian palm oil futures extended gains for a fifth straight session on Monday and hit a two-year high, on fears that supply is set to fall sharply. The benchmark palm oil contract on the Bursa Malaysia Derivatives Exchange was up 1.3% at 2,896 ringgit ($694.48) per tonne in early trade, the highest price since Feb. 16, 2017. A Reuters poll on Thursday forecast Malaysian palm oil production would show a 10% monthly fall in November, but traders said they now expect it to fall as much as 13%, driving prices higher.
Relentless torrential rains in spring and summer, followed by early autumn cold and snow, have stalled harvests in parts of the Corn Belt. It's another blow to farmers already struggling with the effects of planting delays and a trade war that have applied downward pressure on commodity prices they receive. The 2019 corn and soybean harvests have been especially delayed in North Dakota and Minnesota — precisely the states suffering the most from the U.S.-China trade war due to their reliance on exporting to Asia through West Coast ports.
Soybean futures in the January contract is trading higher by 2 cents at 8.79 a bushel breaking a 7 day losing streak as this market could possibly be experiencing oversold conditions at this time.
Investors have stampeded into China's edible oil markets, drawn by the volatility caused by the nation-wide outbreak of African swine fever that curbed oilseed crushing, slashed pork output and forced food courts and restaurants to change up menus. Open interest in Dalian Commodity Exchange soybean oil and palm olein futures hit a record this week, while traded volumes in the markets scaled multi-year highs.
Excessive rains and an October snowstorm have stalled the harvest in the U.S. grain belt's northern tier, one more blow to farmers already struggling with the effects of planting delays and a trade war that has pressured commodity prices. The corn and soybean harvests are especially delayed in North Dakota and Minnesota - precisely the states suffering the most from the U.S.-China trade war due to their reliance on exporting to Asia through West Coast ports.
"The recovery is on its way," proclaimed one analyst, speaking about the dry bulk sector ... in 2014. "The trough is now squarely in the rear-view mirror," said another a half-decade ago. As it turned out, dry bulk earnings set fresh lows in early 2015, came up a little, then crashed to an all-time nadir in early 2016.
The EPA's plan to begin replacing 4 billion gallons of ethanol lost to waivers for oil refiners was met with displeasure Tuesday by some trade groups.