Commodity Corner: Morning Comments

Good morning,


DXH0  99.755  +0.158              GCJ0  1619.6  +7.8                            ESH0  3382.00  -5.25                CLJ0  53.96  +0.47


Gold traded to a 7 year high yesterday, and extended the move up overnight.  The continued demand for safe haven assets, coupled with the apparent racially motivated shooting in Germany has allowed the flight to continue.  Equities are in a slight correction today, after marching to new highs again yesterday.  Morgan Stanley just announced an all stock purchase of E-Trade for $13B.  Oil continues its bounce as well, trading over $54 in the overnight trade.  OPEC+ announced there will not be any emergency meetings now to discuss further production quota cuts in the face of coronavirus, rather they will meet at the already scheduled date of March 5-6.  Yesterday afternoon, API projected crude inventories rose last week by 4.16m barrels, above the expected increase of 3.2m barrels.


The dollar traded to a 33 month high against the major currencies yesterday and the Brazilian real was weak again.  Sugar futures continue the grind to new highs, as Thailand production concerns outweigh decent cane production out of Brazil.  Coffee futures were up slightly, consolidating ahead of first notice day.  Lumber futures were up sharply, on the back of the strong housing numbers yesterday morning.  Cotton futures continued its strength, driven by the tariff waiver announcement out of China the other night.


Wheat prices, following the huge spike observed on Tuesday, rotated back down yesterday, only to correct back up to post a marginal loss at the close.  Corn was down slightly as well, while soybeans traded higher.  The grain markets are awaiting the annual outlook from the USDA, which comes at the conference running today and tomorrow.  Projections for the coming season’s production and inventory totals in the US are expected.  Estimates show increases expected in corn and soybeans, while a steady projection for wheat area planted, and lower production and stocks guesses. 


So the market remains focused on coronavirus updates, the US political arena, the bid to dollar assets, highlighted by gold and oil and any potential geo-political issues/tensions.         


Technical Moving Averages:

Product               50 day                100 day               200 day

SH0                      917.00                   925.50                   917.75

CH0                      384.00                   387.75                   403.25

WH0                    554.25                   535.25                   522.75

KWH0                  472.00                   452.25                   458.50

MWH0                541.00                   539.75                   547.50

SMH0                  298.6                     303.5                     308.2

BOH0                   32.70                     31.82                     30.47

CLH0                    56.80                     55.96                     55.90

GCJ0                    1545.3                   1521.7                   1480.2

LHJ0                     72.170                   75.820                   78.065

LCJ0                     124.470                 123.825                 120.060

KCK0                    118.90                   114.25                   111.35

CCK0                    2670                       2605                       2503

CTK0                    69.56                     67.58                     66.41

SBK0                    14.06                     13.38                     13.21

JOH0                    98.30                     100.65                   105.55

HGH0                   272.40                   268.45                   267.80





Michael Clifford


141 W Jackson Boulevard                             

Ste 1065                                                              

Chicago, IL 60604                                              

Trean Group, LLC