Early Market Talk October 12, 2021


CZ21 in a tight 2 1⁄4¢ range overnight and trading 1 1⁄4¢ lower at 0600. SX21 in a 6 1⁄4¢ range to this point and trading 2 3⁄4¢ lower. Volume on lead months typical of a nite session but leaning toward the lite side.

SX21 trading at the lowest level since March and with a little help from WASDE today, SX21 could be trading the lowest level of the year by month end. 

Dow futures little changed at 34,393. Crude 39¢ higher at $80.91. US $ a scratch lower. 

Report day uncertainty and surprise potential dictates good practice to have all orders in and working. Limits 40¢ on corn and a buck for soybeans. USDA expected to increase U.S. corn and soybean yields, production, and ending stock estimates. 

Anxious to see what WASDE prints for a 21/22 world soybean carryout figure. 

Record bean yields in some areas combined with near $12.00 off the combine cash bids producing increased bean hedge activity. SXSF near 56% of full carry. 

Quite a bit of SX spreading to do yet but focus also on SF forward spreads. Recent changes in market dynamics and considerations have SF22 forward spreads in play at best of season levels. 

Commentary this morning suggesting there is no room for a soybean crop failure anywhere in the world and that will bring a return of spec buying. That kind of thinking seems a bit of a long shot, (certainly not out of the question but NOT the norm) especially when soybeans are trading over $12, not closer to $8.00. Same group singing the Bull story for the last $2.64 price drop. 

Morning weather headlines - More rain for eastern Plains, dryness to linger in western Plains. Long range outlook remains hot and dry in Argentina. 31–60-day outlook dry across the north central U.S.

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