ken morrison
@morrisonmkts
commodities; mostly of the agricultural kind
Interest Rates: 30 yr tsy yield assured of the highest monthly close in over 20 years.
Diesel Production (BBG): U.S. production on course for seasonal daily record , much of it is exported. Refining margins for diesel near $2/gallon, also near a record
Purdue-CME latest survey of Ag Producers (Right Track / Wrong Track) : For perspective, 75% of U.S. ag producers voted for Trump in 2024
USTR Greer left China talking of "10's-of-billions" possible future U.S. ag trade to China. This chart provides perspective
Wheat: Speaking of buying the dip. investors in the ETF $WEAT added 23% to their presumable long since the April 28 high, their largest position since June 2022.
Purdue Ag Producer Survey : New high for 'wrong track'/ new low for 'right track'
Cattle & Beef Marketing Chain: Where money is made & lost at each step (BBG & Hyrum Egbert)
Wheat (HRW): Bunge delivered 2.9 m.b. HRW on first-notice day vs. K futures , contributing to today's weakness. There were no strong stoppers , expect continued re-deliveries.
Soy Oil: Managed-$ funds set a new record net-long a 4th consecutive week at 165k contracts. Previous record 127k dates back to November 2016.
Wheat: Managed-$ funds held a small net-long a/o 3/31, their first net-long since 6/28/2022.
Lot of media attention to Fertilizer prices; week/week & y-o-y comparisons below. Biggest impact on corn, very nitrogen-dependent. Net-revenue for soybeans more favorable vs. corn as a result of spike in N-based fertilizers
Soybeans: 3 std. deviation daily decline as the pullback approaches trendline support.
$WEAT (the ETF): Investment rose 11% over the past 5 days in this essentially long-only ETF. That's the largest week-over-week increase since May 2022 .
@SecRollins of USDA, in today's press release on the $12 Billion 'Bridge'' said " four years of disastrous Biden Administration policies resulted in record high input prices and zero new trade deals. " She failed to mention the Record Net Farm Income w/ minimal govt. payments Gaslighting
Purdue - CME Ag Producer Survey: 5% change in this month's survey is interesting considering 75% of rural America voted for Trump, many then citing they 'liked his policies'.
58% of the 400 ag producers surveyed monthly by Purdue say use of tariffs will make agriculture stronger, more than 2x the # who believe tariffs weaken U.S. agriculture
BBG Commodity Index: Precious metals at 18% weight of the index have been a big part of this rally . Rallies have failed here 6x in the past 3 years. 7 ? TBD
Gold: It will be important to see if volume in the lead-month December contract exceeds Friday's 570k, the largest volume since January 2020.
Bunge : 52-week high Wednesday on better-than-expected earnings revision
Live Cattle: Closed higher 8 consecutive days, longest upside streak since June 2023 (9 days). Open interest has declined 10k contracts on this rally indicating short-covering has dominated the $-flow.
Farmer's Expectations for a Bailout & Views about use of Tariffs (Purdue University survey taken mid-September)