A peek or is that peak, at the bigger picture
While current crop year sales for corn and beans did not give campers much to write home about, new sales were not all that bad. Looking first at beans, for the 2020/21 crop year, we sold just 11,400 MT or around 419,000 bushels, but hey, at least they were not negative. For the 2021/22 crop year, sales came through at 424,800 MT or 15.6 million bushels. Unknown destinations topped the list with 142k MT, followed by China at 129k, and then Egypt taking 65k. Current crop year corn sales were a sluggish 68,200 MT or 2.7 million bushels, but we tried to pick up the slack with new crop year sales of 830,200 MT or 32.7 million bushels. Mexico was the top purchaser with 238.8k MT, followed by Japan at 210.7k and then, unknown destinations in for 101.7k. In addition to this, the USDA this morning also reported a sale of 300,000 MT of beans to unknown destinations. Wheat did not fare out as well, though, as sales were down 40% from last week and 28% below the 4-week average, coming in at 308,300 MT or 11.3 million bushels. Mexico topped the list this week with 97.8k MT, followed by South Korea with 54.6k and then Nigeria at 48k. In the meats, beef sales were less than inspiring at 15,000 MT, but pork sales hung in there with a total of 38,800 MT, of which China accounted for nearly 50%.
At the risk of moving the cart ahead of the horse, I want to make you aware of the picture that could be shaping up on the commodity index charts. Using the Goldman Sachs Commodity Index for the example, you can see that we have been trending generally higher now for the past fifteen months and have reached the highest level traded since October of 2014. Take note that the monthly stochastics turned higher in May of last year, but during the past couple of months have been losing upward momentum and are now flirting with a lower reversal. While we could yet snap back into month's end and keep the uptrend intact, it would appear that this bulls train is nearing the end of the line for now. Granted, if the index does indeed turn lower, that does not mean that all commodities are destined to break, but it would create headwinds as at least a portion of outside investment money would likely head for greener pastures.
Hearing about strikes in Argentina is about as shocking as hearing about the latest celebrity breakup, but truckers in that nation are now raising a bit of havoc at the Bahia Blanca ports. Demanding higher pay, they have been blocking roads, and reportedly, no commodities have been able to reach terminals since last Friday, where there are reportedly 40 ships waiting to be loaded. While the Bahia Blanc port is not a large as Rosario, low water levels there have forced ships to the deeper water at Bahia Blanca.
In the macro scene this morning, we have energies firm, metals under pressure, financial instruments lower, the dollar a touch lower, and equities higher.
