Dec 18, 2020

Demand, Weather Risk Add Support Going Into Weekend

Hefty export demand continues to support ag markets

Weekly Export Sales Beat Expectations

  • Soybean sales last week of 34 million bushels were the largest in a month, up from the previous week's 21 million bushels.
  • China has bought 1,150 million bushels to date compared to 386 million last year.
  • Total outstanding sales to “unknown” are 268 million bushels versus 121 million last year.
  • Corn sales were above market expectations at 76 million bushels, up 44% from the average of the last four weeks.
  • Mexico remains the biggest corn buyer, with China also purchasing a few cargoes.
  • Wheat sales were solid at nearly 20 million bushels, close to the top end of expectations.
  • Upland cotton sales of 402,900 running bales were up for a second consecutive week on increases primarily for China of 225,800 bales.

FBN’s Take On What It Means: Hefty export demand continues to support the ag markets. USDA will likely continue to increase export projections which will further tighten ending stocks and potentially lead to higher prices.

FBN

Argentina Crop Progress Update as of December 16

  • Argentina’s soybean crop rating slipped again to 50% rated good to excellent; that is down 5 points from last week and 3 points versus last year.
  • The crop was 68% planted, shy of last year’s 70% and the average at 75%.
  • Soybean plantings advanced 11 points for the week.
  • Corn conditions were steady with 24% rated good to excellent but that remains well below last year’s rating at 42%.
  • Plantings were 55% complete, up from 47% but remaining below the average pace, which is at 61% for that week.
  • The wheat crop was 66% harvested, in line with the average pace.

FBN’s Take On What It Means: All eyes are on Argentina and weather developments there. The weather has mostly been unfavorable overall with dryness remaining a feature. Rains are in the forecast for the weekend but they are scattered and not offering full coverage of the especially dry areas. It still is early in the production cycle but for now, risk is that production levels could be lower than current projections.

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Kevin McNew

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Magazine

Marketwatch: Jan, 18

US Corn Price Idx: ZCPAUS.CM

open: 5.7667
high: 5.8486
low: 5.7266
close: 5.8288

US Soybean Price Idx: ZSPAUS.CM

open: 13.366
high: 13.376
low: 13.2328
close: 13.2696

US Hard Red Winter Wheat Price Idx: KEPAUS.CM

open: 7.3061
high: 7.3384
low: 7.2334
close: 7.2454

US Soft Red Winter Wheat Price Idx: ZWPAUS.CM

open: 7.0114
high: 7.0566
low: 6.9566
close: 7.0014