Morning Comments February 25, 2021

Sillouette Sunset Location Rail

Overnight markets were higher, as new contract highs were made across the entire soy complex and for new crop corn. However, export sales came out after and turned markets sharply lower. 

Weekly export sales were very poor at 17.8Mln corn and 6.2Mln beans. This prompted managed money to hit the sell button, and at the morning pause corn is down a dime and beans are down a nickel. 

The EIA weekly ethanol data was out yesterday. Production declined sharply, as expected, due to natural gas curtailments to 0.658MBPD from week prior’s 0.911MBPD. Inventories also declined sharply to 22.785MBLS from 24.297MBLS. We can expect next week’s production to rebound, but not fully, as logistics are still playing catch up this week, mainly on rail. 

Managed money has added to commodity long positions since last week and are estimated long 387,000 contracts corn and 184,000 contracts beans as of yesterday. Also estimated to have a new record long is soy oil at 127,000 contracts. Soy oil has really spiked this week, moving up and through 50c/gallon on the lead March contract. Supply problems with both canola oil and palm oil were the latest catalyst for the push higher. 

Opening Calls:

Corn: down 5-8c

Beans: down 3-5c