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May 19th- Morning Market Commentary

05/19/2022
May 19th- Morning Market Commentary

Grains were lacking excitement overnight:

July Corn -7 cents/bu (7.74.1/2)

July Soybeans +8 1/2 cents/bu (16.71 1/4)

July Chi Wheat -31 1/2 cents/bu (11.99 1/4)

CDN $ -0.00300 (77.64 cents)

WTI Crude Oil -2.81/barrel (109.59)

More profit taking occurring overnight after wheat reached new contract highs on Tuesday. After major increases, traders are risk-off and letting the commodities settle back to last week’s levels.

On the second day of the Kansas Wheat Tour, the average yield was pegged at 37bu/acre, down from 56.7bu/acre last year and down from the 5-year average of 47.1bu/acre.

Indonesia announced this morning that they are planning on relaxing their ban on palm oil exports in an effort to keep cooking oil ample and affordable. This comes on the heels of the country evoking a complete ban.

The export sales report was released this morning for the week ended May 12th. Results are in thousand tonnes. Wheat and soybeans are above expectations, while corn was in line with expectations.

The drought monitor was released today today for May 17th and showed that moderate drought areas in the U.S. decreased slightly to 44%, however, every other category of drought (abnormally dry, severe drought, extreme drought, exceptions drought) increased. 66% of winter wheat areas are experiencing drought, 21% of corn areas and 12% of soybean areas.

This is an interesting chart that I saw on Twitter comparing December corn futures from 2008 to 2022. There is definitely a clear correlation between the two data sets. Whether or not 2022 has reached the peak is up for discussion now.

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