Who Needs China?
We had heard sales would be good, but not this good. Old crop at 379 krb was tied for tops this market year, a stunner this late. India was high at 99 krb, with Turk 2nd at 94, then Bang at 58 and Pak at 32. We saw this pattern a lot last spring with combined buying out of India-Bang-Pak. Those 3 bought 190 krb of old. New crop sales were out of sight at 246 krb, a high for that year. Viet was 1st at 79 krb and El Salv 2nd at 66. China? They canceled and rolled 25 krb into new crop, a net of -5.
Some rains are possible in W TX into Sat, then the entire belt is clear for planting. The only impediment is the lure of opting for soy for late decisions, with the gov dangling $2/bu in front of farmers. That is downright hypnotizing.
Demand has gone from good to hot, with combined crop year sales at a super 625 krb, highest since Mar 2018. New crop total is 3.55 Mrb, with 10 weeks left. Other recent high beginnings on 1 Aug showed 5.24 Mrb, 6.24 Mrb, and 6.71 Mrb. If current demand keeps up, 19/20 will find itself in high company. Who knows how big the roll may be, so new crop may approach 10 Mrb on the books in the first week. Expectations are for a massive crop, and same for shipments. The only stat showing a little lag is exports at 362 krb, with a target avg of 429. Strange.
Technicals (Dave Toth)
Only a glance at the chart is needed to see that the downtrend remains as the dominant tech factor currently. However, our RJO bullish sentiment index of hot managed money positions reportable to the CFTC has eroded to a 12 year low at 36%. As long as the downtrend remains intact, this is of no matter as market sentiment/contrary opinion is not applicable as a technical tool. But the moment the market does something to threaten the downtrend and reject a more reliable low and support, then that historically bearish sentiment condition is applicable as a tool that warns of a vulnerability to higher prices.
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