Morning Comments/Roy's (RJ O'Brien)

Morning Grain Comments - January 21, 2021

 
SOY-COMPLEX:   Soybeans and products are rebounding this morning after the 3 day break in beans & meal.  Malaysia palm oil is up after a 2 day break on concerns about flooding in the main production areas.  IHS Markit (formerly known as Informa) pegs the Brazil soybean crop at 133 mmt vs their previous number of 132.5 mmt.  Other private estimates also inching up after the recent rains and are in the 132-134 mmt area.  March board crush almost hit a low of 55 cents/bu last week and has bounced to 72 cents/bu yesterday.  Traders anticipate to see some export sales announcements at 8 a.m. A reminder the weekly US export sales and weekly EIA reports are delayed until tomorrow morning.  
 
CORN: Corn is higher this morning after buying interest from Asia on the 3 day price break.  Open interest in corn was up 13k contracts yesterday.  Interior corn basis levels stabilizing in the Midwest with 3 day pull back in futures giving margin call reprieve to elevators.  Ethanol margins remain in the red though production/daily grind in tomorrow's EIA report is expected to be steady with ethanol stocks up slightly.  Monthly Cattle on Feed report is Friday afternoon with avg trade guess for Jan 1 On-Feed at 99.4% of year ago with a range of 98.8-100.0%.  Dec placements are expected to be down 3% vs year ago.  Resistance for March corn back toward the $5.40-5.41 area.  
 
WHEAT: Wheat is slightly firmer this morning as Tunisia now tenders for 92k tons of soft wheat, 92k tons of durum and 75k tons of feed barley.  This comes after Algeria yesterday booked 390k tons of European wheat $22 a ton higher than their last purchase. Russia discussing about putting price limits on pasta.  Japan booked 72k tons in their weekly tender with 21k from Canada and balance from the US (DNS, HRW, and WW).  Look for breaks to be supported yet.