Roundup: Weekly CBOT agricultural futures mixed amid bullish outlook



Roundup: Weekly CBOT agricultural futures mixed amid bullish outlook

CHICAGO, June 12 (Xinhua) -- CBOT agricultural futures consolidated in the past week awaiting certainty in the summer Central U.S. weather pattern, Chicago-based research company AgResource noted.

AgResource stays bullish on agricultural futures amid rising consumer demand, as the vaccination rate of the emerging nations improves, and the forecast for world economic growth rates will be rising.

CBOT corn ended steady to higher with the bullish leadership transitioning to new crop futures. Interior basis levels remain perched at multi-year highs. U.S. ethanol plant bids have been particularly strong as normal driving patterns resume and ethanol inventories are much lower than normal.

The corn outlook remains bullish. Demand from ethanol production in turn implies that even yield loss of 5 percent relative to trend requires supply rationing throughout the 2021-2022 crop year. And concern over Central U.S. weather remains high as crops labor under heat/dryness into late June. Fact is that precipitation accumulation across 60 percent of U.S. Midwest is below that of 2012.

AgResource predicts that an intense rally will unfold from mid-June onward if the current U.S. weather pattern is maintained.

U.S. wheat futures ended mixed, with spring wheat shedding sizable weather premium amid soil moisture improvement in Canada and pockets of North Dakota. Hard red winter (HRW) wheat contracts ended firm despite U.S. Department of Agriculture's (USDA) yield boost this week, and this confirms that seasonal lows were scored in mid-May. Overall, harvest-based weakness will be limited as importer demand returns and massive spring wheat yield loss is anticipated across the U.S. Northern Plains and Pacific Northwest. Spring wheat crops in Central Russia and Kazakhstan will also be exposed to lingering heat and dryness into late June.

Wheat outlook is turning more bullish based on U.S. production loss. The market must keep pace with corn and soybean to prevent acreage contraction in 2022-2023. Wheat's long-term uptrend persists into early 2022.

Soybean futures ended the week lower on profit-taking. The June World Agricultural Supply and Demand Estimates (WASDE) report featured a lower old crop crush estimate, which lifted old crop stocks by 15 million bushels.

While old crop soybeans finished the week 0.75 dollars lower, new crop marked a small 3-cent gain. Moreover, the rain event in the Plains offered limited relief to severe drought conditions. The Drought monitor showed that 31 percent of the U.S. crop is now in drought, including 64 percent of the crop in Iowa and 83 percent of the crop in Minnesota. Drought looks to be spreading South and East, with limited rains in the forecast.

AgResource stays bullish for new crop soybeans on growing weather risk.

Roundup: Weekly CBOT agricultural futures mixed amid bullish outlook

Roundup: Weekly CBOT agricultural futures mixed amid bullish outlook

Xinhua
13th June 2021, 03:49 GMT+10

CHICAGO, June 12 (Xinhua) -- CBOT agricultural futures consolidated in the past week awaiting certainty in the summer Central U.S. weather pattern, Chicago-based research company AgResource noted.

AgResource stays bullish on agricultural futures amid rising consumer demand, as the vaccination rate of the emerging nations improves, and the forecast for world economic growth rates will be rising.

CBOT corn ended steady to higher with the bullish leadership transitioning to new crop futures. Interior basis levels remain perched at multi-year highs. U.S. ethanol plant bids have been particularly strong as normal driving patterns resume and ethanol inventories are much lower than normal.

The corn outlook remains bullish. Demand from ethanol production in turn implies that even yield loss of 5 percent relative to trend requires supply rationing throughout the 2021-2022 crop year. And concern over Central U.S. weather remains high as crops labor under heat/dryness into late June. Fact is that precipitation accumulation across 60 percent of U.S. Midwest is below that of 2012.

AgResource predicts that an intense rally will unfold from mid-June onward if the current U.S. weather pattern is maintained.

U.S. wheat futures ended mixed, with spring wheat shedding sizable weather premium amid soil moisture improvement in Canada and pockets of North Dakota. Hard red winter (HRW) wheat contracts ended firm despite U.S. Department of Agriculture's (USDA) yield boost this week, and this confirms that seasonal lows were scored in mid-May. Overall, harvest-based weakness will be limited as importer demand returns and massive spring wheat yield loss is anticipated across the U.S. Northern Plains and Pacific Northwest. Spring wheat crops in Central Russia and Kazakhstan will also be exposed to lingering heat and dryness into late June.

Wheat outlook is turning more bullish based on U.S. production loss. The market must keep pace with corn and soybean to prevent acreage contraction in 2022-2023. Wheat's long-term uptrend persists into early 2022.

Soybean futures ended the week lower on profit-taking. The June World Agricultural Supply and Demand Estimates (WASDE) report featured a lower old crop crush estimate, which lifted old crop stocks by 15 million bushels.

While old crop soybeans finished the week 0.75 dollars lower, new crop marked a small 3-cent gain. Moreover, the rain event in the Plains offered limited relief to severe drought conditions. The Drought monitor showed that 31 percent of the U.S. crop is now in drought, including 64 percent of the crop in Iowa and 83 percent of the crop in Minnesota. Drought looks to be spreading South and East, with limited rains in the forecast.

AgResource stays bullish for new crop soybeans on growing weather risk.