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Rice Prices See a Small Rebound for the Week

Rice prices were a little higher in slow trading on Friday and a little higher for the week, Old crop to new crop spreads were firm last week. Increased precipitation and warmer temperatures for US growing areas have kept the market under pressure in recent days. Rice areas have generally been wet. Louisiana and parts of Texas are saturated.

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Wheat: Winter Wheat markets were lower on showers and rains seen in Winter Wheat production areas, but Minneapolis Spring Wheat was higher as a freeze hit production areas late last week and on forecasts from NWS calling for a warmer and drier than normal summer growing season. Showers and rains were seen in parts of Western Texas and in Oklahoma and also in the northern Great Plains. Kansas and the Canadian Prairies got some beneficial rain, but it also froze in parts of the Dakotas and into Canada late last week. Scattered showers are in the forecast in western Texas and rains are possible into Kansas. These rains should be very beneficial for planting and initial growth, and more is in the forecast. Wheat remains a weather market, but the demand side has been weak. Demand remains disappointing but the production might not be there for better demand in the coming year. Corn prices are high so demand for feed wheat could increase. 

Weekly Chicago Soft Red Winter Wheat Futures 

Weekly Chicago Hard Red Winter Wheat Futures

Weekly Minneapolis Hard Red Spring Wheat Futures

Corn: Corn closed lower in correction trading while Oats closed higher. Corn was slightly lower for the week but Oats were higher.  Talk persisted that China would take the vast majority of its Corn purchases for the old crop year.  There was talk that Chinese state companies had purchased another 1.0 million tons of US old Crop Corn and that the companies remained active in buying new crop Corn as well. No additional business was confirmed by USDA last week. There had been rumors that China was going to cancel a large chunk of the old crop purchases, but Bloomberg said that the amount in question was less than 1.0 million tons and had been bought by the private industry for delivery to free trade ports. Improved weather forecasts and reports and higher acreage estimates have been the bearish factors in the market.  Planting and emergence has been above average in all areas. Temperatures are expected to stay generally warm this week. There will be precipitation that will benefit crops. Overall planting and initial growth conditions should be fairly good over the next week.  Longer range forecasts released by NWS call for warmer and drier weather for many important US growing areas this Summer. There are problems with the production potential for the Safrinha crop in Brazil as growing areas have been warm and dry and look to stay that way longer term. Reports indicate that crops are being stressed due to the lack of rain.  It is drier in central and parts of northern Brazil, but southern Safrinha areas got some timely and somewhat beneficial precipitation over the weekend. 

Weekly Corn Futures: 

 Weekly Oats Futures

Soybeans and Soybean Meal: Soybeans and Soybean Oil were lower on Friday in consolidation trading and Soybean Meal was higher on spreading against Soybean Oil. Futures were lower in all three markets last week as most of the bullish news appears to be in the market.  China should start with new US Soybeans purchases soon for Fall delivery.  Some of the selling was in response to the improved Midwest and Great Plains weather that showed precipitation in many areas with more coming.  The Dakotas and much of the Great Plains as well as much of the Midwest got beneficial rains. The longer-range forecasts from NWS call for warmer and drier than normal conditions for most Soybeans areas of the US. There is still crush demand and a little export demand even though the demand is less now than before. The US does not have a lot of Soybeans in the country anymore as most producers have already sold.  Buyers are scrambling for what is left.  Brazil is rapidly exporting Soybeans. 

Weekly Chicago Soybeans Futures:

Weekly Chicago Soybean Meal Futures

Rice: Rice prices were a little higher in slow trading on Friday and a little higher for the week,  Old crop to new crop spreads were firm last week. Increased precipitation and warmer temperatures for US growing areas have kept the market under pressure in recent days. Rice areas have generally been wet.  Louisiana and parts of Texas are saturated.  Warm temperatures are finally spreading north into Arkansas and Missouri and the crop progress is improving.  Texas and Louisiana are almost out of Rice, but there is Rice available in the other states, especially Arkansas.  Milling interest in Rice is said to be slow.

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Weekly Chicago Rice Futures

Palm Oil and Vegetable Oils: Palm Oil was lower for the week along with the price action in competing vegetable oils.  There is new talk of supply disruptions due to the Coronavirus outbreak. The private sources showed that export demand is mixed from last month, but the market fears the loss of Indian demand due to the big Coronavirus outbreak in India that could cut demand. However, prices are very high in India, and imports are needed.  Ideas of tight supplies are still around but supplies are expected to increase in the short term. Canola was higher along with price action in Chicago and despite improved growing and planting conditions.  Some showers were seen in all areas late last week and there is the potential for more rains this week. Demand is thought to be OK with crush margins favoring a lot of production of vegetable oils to feed the demand but less exports. The demand for biofuels is about to increase and is one reason to see much stronger Soybean Oil and Canola prices.

Weekly Malaysian Palm Oil Futures:

Weekly Chicago Soybean Oil Futures

Weekly Canola Futures:

Cotton: Futures were a little lower on Friday and spent the week in a sideways trading range.  Support came from the stronger sales in the weekly export sales report.  The reports have shown improved sales for the last couple of weeks.  Trends are mixed on the daily charts. Cotton growing conditions have improved with rains reported in West Texas and the Delta. The forecasts for the Panhandle region of Texas are improved with rains seen over last week and with more coming. It is drier in the Southeast production areas. The Southeast needs to be watched as conditions there could turn too hot and dry.  Delta crop conditions are called good.

Weekly US Cotton Futures

Frozen Concentrated Orange Juice and Citrus: FCOJ closed a little higher for the week and chart trends started to turn up as the US harvest is about over.  The weather in Florida is good with mostly dry weather. The hurricane season is coming and a big storm could threaten trees and fruit. An active season is anticipated.It is dry in Brazil and crop conditions are called good even with drier than normal soils. Stress to trees could return if the dry weather continues as is in the forecast. Mexican crop conditions in central and southern areas are called good with rains, but earlier dry weather might have hurt production.  It is dry in northern and western Mexican growing areas. The Florida Movement and Pack report showed that Florida inventories are 14% less than last year.  

Weekly FCOJ Futures

Coffee: New York and London both closed sharply higher and at new contract highs on Friday and higher for the week on the return of dry and hot weather to some of the Brazil growing area.  London was also sharply higher on Friday and closed at new contract highs as Vietnam and Brazil Robusta areas stayed dry.  The daily and weekly charts show up trends now in both markets and both markets have cleared some important resistance areas on the weekly charts.  Most Brazil Coffee areas should stay dry for at least the next week although a few showers are possible in southern Minas Gerais again. Fears of dry weather impacting Brazil production continued to support prices overall.  It will be cool, but not cold.  It is also the second year of the production cycle so production will be less, anyway. Production conditions elsewhere in Latin America are mixed with good conditions reported in northern South America and improved conditions reported in Central America.  Conditions are reported to be generally good in Asia and Africa. It’s turning a little dry in Southeast Asia including Vietnam, but a storm brought some beneficial precipitation in recent days. 

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Weekly New York Arabica Coffee Futures

Weekly London Robusta Coffee Futures

Sugar: New York and London were both higher and trends turned up on the daily carts. Demand ideas for Cane are starting to improve.  Demand for ethanol should be increasing and could divert the cane processing to production of the ethanol and away from Sugar. There is plenty of White Sugar available in India for the market.  Fears of dry Brazilian weather continued, but southern growing areas are getting some beneficial rains, with Parana and parts of Sao Paulo getting the best rains. Production has been hurt due to dry weather earlier in the year. The seasonal crush is off to a slow start and Sugar content of the cane is reduced in initial industry reports from the center-south of Brazil.  India is exporting Sugar and is reported to have a big cane crop this year. Thailand is expecting improved production after drought-induced yield losses last year. Ethanol demand is returning to the market as more world economies open up after the pandemic. 

Weekly New York World Raw Sugar Futures

Weekly London White Sugar Futures

Cocoa: New York and London closed lower in range trading on Friday and both markets were a little lower for the week. The daily charts show sideways or downtrends in both markets. The harvests are over in West Africa and ports there have been filled with Cocoa. The weather has been a little too dry for best production prospects for the next crop.  European demand has been slow as the quarterly grind data showed a 3% decrease from a year ago in grindings. This has been caused by less demand created by the pandemic. Asian demand improved. North American data showed improved demand. The supplies are there for any increased demand. 

Weekly New York Cocoa Futures

Weekly London Cocoa Futures

(Featured image by Quang Nguyen Vinh via Pexels)

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Jack Scoville is a futures market analyst specializing in grains, softs, rice, oilseeds, and tropical products such as coffee and sugar. In addition to writing daily market commentaries in both English and Spanish, he offers brokerage services to an international clientele of agricultural producers, processors, exporters, and other professional traders. He is regularly quoted by major wire services including Dow Jones, AP, and Reuters. His comments are sourced by newspapers around the world and on various radio and television programs.