Home Commodities CBOT weekly outlook: Commodities largely rangebound after USDA report

CBOT weekly outlook: Commodities largely rangebound after USDA report

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MarketsFarm — Although soyoil on the Chicago Board of Trade has fallen back for five consecutive days as of Tuesday, it has remained rather rangebound, according to trader Ryan Ettner of Allendale Inc. in McHenry, Ill.

“We’re actually at prices where it was in early August,” Ettner said, pointing to something of a back-and-forth shifting in the soyoil/soymeal spread.

“You have people selling the oil and buying the meal, he added, suggesting there’s little need to worry about unless the nearby May soyoil contract were to lose a couple of more cents dropping to 58 U.S. cents/lb.

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As for soybeans, Ettner said pressure has been coming from “solid rains in Argentina” during the weekend, with more rain in the country’s 10-day forecast.

As for the soybean crop itself, that much-needed moisture for drought-stricken Argentina arrived in the nick of time.

“The rain is probably not going to able to raise production estimates back up to where they were, but there’s a solid case for not needing to lower them anymore,” he said.

On Wednesday, Oil Watch issued its call on the 2022-23 soybean crop in Argentina, pegging it at only 34 million tonnes. Recent projections from other sources include the Rosario Grain Exchange at 37 million tonnes, Soybean and Corn Advisor at 39 million, the Buenos Aires Grain Exchange at 41 million, and the U.S. Department of Agriculture optimistically at 45.5 million.

As for corn, Ettner said that commodity most often cools after USDA has released its January report and doesn’t follow the South American weather as much as the soybean market does.

“Corn doesn’t have too much to look forward to, in the way of major reports, until the traders start thinking about acreage,” he said.

That has been somewhat different this January, as he pointed to significant volumes in corn trading. Only on Wednesday were the volumes notably lower.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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