Corn – Carryout raised to 2.172, continues the slow grind lower, demand improving to slow the slide
↓ Carryout raised yesterday to 2.172 when analysts had expected a small decline, exports unchanged
↔ Open interest down 5K, it at least suggests that new fund selling was unlikely, does not yet suggest
that we are seeing fund short covering, we would need to see multiple days of an OI decline
↑ We are seeing improved exports and ethanol as corn moves to new 3 year lows on a frequent basis,
this is the better demand that we would expect which is slowing the slide but not causing a bounce yet
↓ March is still falling to a range established between 2014 and 2020 where the lead contract of corn
stayed mostly in a range between 350 and 400 for 7 years
Beans – Carryout raised to 0.315, USDA lowered exports, CONAB lowers BRA production
↓ USDA lowered exports 35 mln bu which raised carryout to 0.315
↓ The carryout increase suggests the grind lower can continue, little reason for funds to exit shorts
↑ CONAB lowered BRA bean production to 149.4, mostly in line with other estimates but is the 1st time
that CONAB has lowered production under last year’s record 154.6 MMT
↔ While CONAB lowered production we need to keep in mind it is simply now not a record crop
↓ OI increased 3K and funds still have room for adding to bean shorts
Wheat – Russian and French wheat made it new significant lows again yesterday
↓ Both Russian and French wheat may new significant lows yesterday which will continue to spill
pressure over to US wheat with KC finding the most pressure but CHI also following
↓ The USDA raised carryout to 0.658 which also adds light general pressure
↔ Exports are remaining moderate, could add support if we see weekly sales back over 500K
Cattle – Another day of active support and another day where OI does not confirm fund buying
↔ Yesterday’s PM BB was choice +0.03 select -1.30 packer BE at 183.87, packer cushion $5.65
↑ Yesterday saw another round of active speculative buying and the like Tuesday the open interest
report this morning did not confirm that it was fund buying, up only 2K
↑ Given the size of the buying it would still suggest funds but we won’t be able to confirm that until
next Friday’s COT report, this afternoon’s report will show if Tuesday’s buying was funds
↔ Cash bids remain the same at 178 in NE which is steady with last week, this is something we
expected as most of the support has been speculative buying and not based on fundamental news
which gives packers reason to try and keep lower bids this week