The EU remains the top producer of Oats with the US output amounting to only about 4% of world supply. While we do rank about 7th in the world in terms of Oats output, our production YoY has declined marginally over the past couple of years. In recent times, plant-based milk alternatives have gained importance among grocers and on coffee shop menus. Within this category, oat milk has been accounting for nearly all sales increases with some companies reporting doubling year-on-year growth for their brands, even as demand for other prior established alternatives in almond milk and soy milk having plateaued in overall demand. In fact, Oats require just a fraction of the water needed for say, almonds and bypasses some published health concerns surrounding soy-based food products. The milk derived from Oats remains tasty with a naturally low sugar content, while presenting a creamy texture and frothiness delivers the desired outcome for many coffee shop owners who have seen increased appetite for this from consumers.

Our analysis is price based and not of fundamentals however and we present the chart and a trade opportunity for July expiration Oats as follows:

Trade entry range: 340~343

Stop: 332

Direction/Action: Long/Buy

Profit target: 364

This isn't a margin intensive commodity and with caution and appropriate risk management, can be carried as a swing trade.

Chart