Wheat, Corn, Hogs: Danube Drone Risk Meets Fund Shorts
· Week ahead · 7:32 · AI-generated voice presenting Feedsoft research
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Drone strikes on Ukraine's Danube grain outlet meet a heavy fund short in soft red winter wheat; watch whether Friday's wheat gains hold and whether Thursday's export sales show US corn catching up despite a one-year-high dollar.
Stories in this episode
- Drones attack three commercial vessels exporting grain via the Danube
- Gold and silver are supposed to protect against inflation. So why are both metals tumbling instead?
- Grain market turmoil pushes Russian and Ukrainian wheat exports onto alternative routes
- How Black Sea disruptions are changing the global food map: from Russia and Ukraine to Europe
- Russian Grain Exports Recovering
- Wheat and barley gain ground in EU animal feed amid corn shortfall
- Rice imports balloon as El Niño ravages farms
- TMO's 295,000-tonne corn tender concluded: From which firms and at what prices? Full port-by-port list...
- Poultry Industry May Bottom Out in Q3
- Sources: Global urea price decline pressures agreement to raise gas prices 50%
- Egypt hikes gas prices to fertilizer plants by 50%, lifts subsidy obligations
- Fertilizers: imports fall 14.7% and price rises 12.6%
Transcript
Cold open · 0:00
On Saturday, drones struck cargo ships near Sulina, in Romania, right at the mouth of the Danube channel Ukraine now leans on for grain exports. And at last count, funds were still net short 87,126 contracts of soft red winter wheat. So the question for the week: does wheat start pricing that route risk, or do the shorts hold their ground?
Intro · 0:28
Hello, and welcome to Feedsoft Market Signals, your daily read on agricultural and commodity markets, brought to you by Feedsoft dot A-I. I'm your AI host, and it's Sunday, November fifteenth. Let's look at the week ahead.
Where markets stand · 0:49
Markets are shut for the weekend, so this is where Friday's settles left things. The loudest move came in lean hogs, which jumped 11.5% on Friday. Even after that leap, the hog price still sits in the bottom quarter of its range over the past year. Why so violent a bounce? At the last read, funds were as bearish on hogs as our data has ever recorded. Was that short covering? We won't know until the next Commitments of Traders report, out this Friday. Wheat firmed as well: hard red winter rose 2.4%, and soft red winter rose 1.6%. Corn settled at $4.46/bu and soybeans at $12.33/bu, both up modestly. The dollar index finished at its highest in a year. It's now up 4 sessions in a row. That likely makes US grain a harder sell abroad. Brent crude, for its part, is up 3 sessions in a row. And rough rice ended at its highest in a year.
The week's big question: Black Sea risk vs a heavy wheat short · 1:50
Back to the Danube. Reports say unidentified drones hit cargo ships near Sulina on Saturday, at the entry to the channel Ukraine has used since halting Black Sea port operations. Crews put out the fires, no injuries were reported, and Romanian authorities have not named the attacker. Sulina handles only a fraction of Ukraine's export capacity, and that outlet was already squeezed. Attacks there likely pile war-risk premiums and higher freight onto every cargo that still gets through. The wider picture was tight before Saturday. S&P Global puts Russian wheat exports at 32.5 million tonnes this marketing year, far above its estimate for Ukraine. Now, the money is leaning the other way. In early November, managed money was net short 87,126 contracts of soft red winter wheat, a position more bearish than most of its history. Funds leaning that heavily short into a supply scare could be forced into some covering. Friday's gain of 1.6% in soft red winter may have been an early taste of that. But there are real offsets. Reports say Russian wheat exports are regaining pace through Baltic ports and rail to Central Asia, while stocks pile up at home. And that strong dollar likely makes US wheat pricier for importers. US all-wheat export commitments are already running behind their usual pace for this point in the season. One modest support comes from Europe, where a shrinking corn crop is shifting feed demand toward wheat and barley. The takeaway: watch whether wheat holds Friday's gains on Monday, and whether Thursday's export sales show buyers turning to US wheat.
Day by day · 3:38
Here's the calendar, in order. None of these reports typically moves prices much on its own; the usual move is ±0.0%. Monday brings Crop Progress and Condition at 15:00 CT. Wednesday at 09:30 CT, the Weekly Petroleum Status report lands. Its ethanol output figures matter for the corn grind and for distillers grains supply. Thursday at 07:30 CT, Export Sales. Corn is the one to watch there, and more on that at the end. Also on Thursday, the US Drought Monitor at 07:30 CT. Friday at 14:30 CT, Commitments of Traders. That's where we learn whether hog shorts covered, and whether the wheat funds blinked. And the following Monday brings another Crop Progress report.
Feedsoft · 4:32
Market Signals is brought to you by Feedsoft dot A-I. See what this week's prices do to the cost of a broiler, layer, swine or dairy ration, and which ingredients moved it. It's at feedsoft dot A-I slash feed cost.
Weekend and abroad · 4:48
Start in the Philippines, where rice imports reached 4.49 million metric tons by late October. El Niño drought is projected to cut domestic output, so the buying could well continue. That kind of buying likely helps explain why rough rice futures are up 81% on the year. Feed demand elsewhere is pulling in opposite directions. In Turkey, the state grain board awarded its full feed corn import tender, though final board approval is still pending. Those prices likely become a reference point for feed buyers across the region. China is heading the other way. An H7 bird flu detection at a Dongguan live-bird market cut live chicken sales sharply. Reports say Guangdong feed sales have dropped steeply for more than a month, and feed prices have been trimmed. That points to softer local demand for corn and soybean meal. On the input side, Egypt raised gas prices for fertilizer plants and, in return, let them export their full output for a set window. Egyptian urea offers had already slipped on weak European demand and no Indian tenders. US urea sits in the bottom quarter of its range over the past year. The net effect could cut both ways: costlier gas trims output, but the export window adds supply. Staying with fertilizer, Brazil imported less this year, as farmers delayed purchases on tight margins and pricier credit. That could become a planted-area question for next season.
The Signal for the week · 6:23
Demand for feed corn clearly exists: Turkey just awarded its whole tender. The real question is how much of that demand US corn is actually winning. US commitments stand at 33% of USDA's forecast, against an average of 44% by this point in recent years. And a dollar at its highest in a year could give rival origins an edge. So here's the Signal: if Thursday's Export Sales report, at 07:30 CT, shows US corn closing that gap, buyers are looking past the dollar; if the gap widens, they aren't.
Outro · 7:04
And that's Market Signals for Sunday, November fifteenth. Thanks for listening. Prices, charts and today's transcript are at feedsoft dot A-I slash podcast. This is market information, not investment advice. I'll be back tomorrow after the close. Until then, take care.
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