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Monday, March 31, 2014, 3:31 pm Submitted by: Joel Pudenz
This morning’s report was cause of volatility in the market today with corn trading a 28 cent range and beans a 43 cent range. Nearby corn closed a dime higher as quarterly stocks were 7.006 bln bu – near trade expectations, but still a friendly number as some expected lower feed usage. Export inspections were strong at 52.2 mln this morning. Planting Intentions were 1 mln acres less than trade expectations, helping December corn close 11 cents higher and was also supportive old crop prices. Iowa showed an increase of 400k acres.
Nearby soybeans closed 27 cents higher as the quarterly stocks number of 992 mln bu. reinforced the fact of a tight U.S. soybean carryout (145 mln). Planting Intentions are 81.5 mln acres (a record), nearly 5 mln. acres more than last year. Iowa shows an increase of 300k acres of soybeans. November soybeans closed 3 cents lower on the large acreage number. The market will watch the intentions evolve into decisions and look to weather/spring planting as we stand on the doorstep of spring.
Monday, March 31, 2014, 7:57 am Submitted by: Dustin Weiner
With the big USDA report due out at 11am this morning, there isn’t much going on in the trade to talk about. So far it looks like the market will try to drift lower into that report – corn and wheat are both over a nickel lower while soybeans are down a couple cents.
U.S. weather… much needed rainfall is hitting a good part of the western Corn Belt today, but parts of the Dakotas and northern Minnesota are expected to get a blizzard – somewhere between 4 and 10 inches of snow. The 6-10 day outlook looks like below normal temps will continue for most of the U.S.
Outside markets are mixed with Crude Oil lower at this time (DN 12 @ 101.55) along with a lower US Dollar (137.84 vs. Euro) and the US stock market is higher (UP 77).
Other than that, all eyes will be on the report at 11am! The last few years this March report has pretty much caused a limit move in corn – the question is which way??
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Friday, March 28, 2014, 7:49 am Submitted by: Dustin Weiner
Today is Friday but all anyone can talk about is Monday – and of course, the stocks/acres numbers that we will see from the USDA. The calls coming out of Chicago so far this morning look mixed – with ‘profit taking’ and the ‘evening up of positions’ being mentioned quite a bit. It was interesting, yesterday was a big volume day for corn traded at the CBOT – but I’m told if you were there, it didn’t feel like it. This is likely a sign that the funds were active buyers yesterday behind the scenes. It is starting to feel like the market will be expecting friendly corn numbers on Monday, anything else and it could turn lower quickly…
As for soybeans, there is nothing new out there that I see. Today soybean meal is down while soybean oil is up – this is the exact opposite of yesterday’s trade which confirms the thought that today will be choppy. Soybeans were down yesterday falling victim to fund liquidation ahead of Monday’s report. I stuck some trade estimates for Monday’s data at the bottom of these comments.
Outside markets are higher with Crude Oil higher at this time (UP 44 @ 101.72) along with a higher US Dollar (137.33 vs. Euro) and the US stock market is higher (UP 33).
Thursday, March 27, 2014, 8:14 am Submitted by: Dustin Weiner
The USDA came out with their weekly export sales report this morning, and I read it as friendly to corn and neutral/friendly to soybeans. We had another strong week of sales in corn, total sales came in well above the average trade guess. Old crop soybean sales were tiny last week (less than half a million bushels net) but they weren’t negative - meaning no net cancellations which is supportive. Currently the U.S. has sold nearly 107% of what the USDA has pegged in their S&D (this equates to an approximate 100mb difference). It is almost getting too late to see cancellations out of the U.S. because with the vessels already sitting in line, it would cost big $$ to switch them to somewhere else. It is honestly easier/more cost effective for China to cancel purchases they have from Brazil and instead sell those boats into the Eastern U.S. (read: U.S. soybean imports are increasing, which is needed).
I don’t talk about livestock often but tomorrow’s hogs & pigs report has the potential to be a market mover because of PED – not just to the hog market (which has been rallying) but also for corn. Any reduction in feed demand of course bumps the bottom line corn carryout higher and is bearish to prices.
Wednesday, March 26, 2014, 3:09 pm Submitted by: Joel Pudenz
News was sparse today with corn trading slightly lower and beans closing higher. Weekly ethanol production added some pressure to corn, slipping .67% vs. last week as rail logistic issues continue to keep a cap on what ethanol producers can ship. Ethanol stocks vs. last week were up 2.46%. Eastern Europe is still volatile, but corn and wheat vessels out of the Black Sea are still loading on schedule. Weakness in wheat (due to needed rains in Oklahoma and Texas) also found its way into the corn market.
Beans traded mixed, but was able to close 12 cents higher. Rumors of Chinese cancellations failing to materialize continues to add support. Stronger meal prices and a decent amount of fund buying were also supportive to beans today. Harvest in Brazil is over 2/3 complete and Argentine producers are discovering better-than-expected yields as they begin harvest.
Wednesday, March 26, 2014, 8:02 am Submitted by: Dustin Weiner
The markets were quiet overnight last night with corn trading around 2c lower and beans a nickel lower at the 7:45am pause. Yesterday Informa released their guesses on planted acreage this fall and it wasn’t overly surprising. They showed corn acreage at 93 million acres and soybean acreage at 81.2 million acres. This is right in line with what most traders are thinking. The average trade guesses for next Monday’s Prospective Plantings report is 92.748ma of corn and 81.075ma of soybeans.
Later this morning there will be a weekly ethanol production report released that could move the corn market a bit, and tomorrow morning we will see our weekly export sales report (bean cancellations anyone??) but other than that this week looks quiet for new news. So… between now and Monday morning expect a similar trade to what we are seeing today – choppy, mixed, maybe trending a bit lower.
Tuesday, March 25, 2014, 8:04 am Submitted by: Dustin Weiner
The markets are mixed this morning with corn a couple cents lower and soybeans a couple cents higher. There isn’t much for news out yet this morning but later today Informa (a well-followed private company) will release their estimates for 2014 planted acreage. This could have a small impact on price action during the trade today but the real report (coming from the USDA) will be released at 11am next Monday (March 31st). I do get the feeling the market may be caught a little long – meaning that between now and Monday would could see the market drift lower as traders even up their position (take profits).
The outside markets are higher with Crude Oil higher at this time (UP 49 @ 100.09) along with a higher US Dollar (138.07 vs. Euro) and the US stock market is higher (UP 77).
Monday, March 24, 2014, 2:46 pm Submitted by: Joel Pudenz
Grains traded higher today with corn, soybeans, and wheat all making double-digit gains. Corn was supported by some fund buying and a solid export inspections number - 45 mln bushels vs. 35 mln needed to meet USDA projections. One week from today, the USDA will release the Quarterly Stocks report and Planting Intentions. Quarterly stocks are expected to be near 7.1 bln bushels; estimates for corn acres are around 93.0 mln acres. Look for corn to be range-bound between $4.80 and $4.90 through this week as the trade prepares for the March 31st report.
Soybeans gained 16 cents in the nearby with support coming from an anticipated bullish stocks report. Export inspections were also friendly. Chinese crushers are still deciding not to default on purchases, but are working to roll S.A. purchases forward or into the U.S. March 31st stocks estimates for soybeans are around 980 mln bu. and acres are about 81.0 mln acres.
Monday, March 24, 2014, 9:07 am Submitted by: Dustin Weiner
The corn and soybean markets are higher this morning, soybeans traded in a big range (40c) last night, trading down 15c when the market opened and got as much as 25c higher in the early morning hours! Uncertainty over Chinese imports is what has the market so volatile. There were rumors late last week that a large Chinese importer wanted Chinese crushers to default on open sales due in part to extremely poor crush margins (which would be negative to prices). Well they had the meeting last night but when no agreement was reached the market turned higher, explaining the sharp rally.
Corn… well there isn’t a ton of news to discuss, corn is trading higher this morning and it appears to be following wheat (which is rallying on drier than expected weather forecasts for the southern Plains). We are one week away from the USDA’s quarterly grain stocks and prospective plantings report, it wouldn’t be a surprise to see corn remain in a range between now and then. Once that report is traded, on to spring weather!
Corn is 6 to 7 cents higher
Soybeans are 2c (new crop) to 7c higher (old crop)
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Friday, March 14, 2014, 8:23 am Submitted by: Dustin Weiner
The markets are called mixed this morning on very little direct fundamental news. Ukraine issues will keep everybody on edge today which could/should keep corn and wheat supported. There are rumors that China may now be cancelling DDG purchases from the U.S. as the soybean meal supplies are starting to make them feel ‘full’. Other than that, so far this looks like it should be a quiet day in the trade.
The markets were steady to higher last night and the weekly export sales report that was released at 7:30am did very little to change that. Corn sales and bean sales were both near the bottom range of guesses - -so no major surprises there. The rumors this week (and the reason for the sharp decline in soybean prices) have center around sales cancellations. If those rumors are true – they will be reflected in next week’s report.
The wheat market continues to find strength thanks to fund buying and continuing problems in Ukraine. This also help keep the corn market propped up. Crimea will vote this Sunday on whether or not to leave the Ukraine for Russia, meanwhile Ukraine’s parliament voted to create a 60,000 member National Guard to help bolster the country’s defenses.
Outside markets are higher with Crude Oil higher at this time (UP 36 @ 98.36) along with a lower US Dollar (139.41 vs. Euro) and the US stock market is higher (UP 30).
Wednesday, March 12, 2014, 8:29 am Submitted by: Joel Pudenz
The markets are under some pressure this morning with nearby soybeans down 39 cents. Rumor is China has cancelled some soybean cargos from Brazil, changed some US Gulf vessels last night, and are seeking to exit other purchases. Additional pressure from fund liquidation pushed the price below last week’s low.
Corn was also lower this morning by 4 cents, but the trade is still uneasy about the Ukraine situation. The Ukrainian parliament has voted to keep the country together even if the people of Crimea vote to leave Ukraine. The uncertainty has the market a little worried about what this means for exports.
Tuesday, March 11, 2014, 12:49 pm Submitted by: Dustin Weiner
Feels like an old-fashioned “Turnaround Tuesday” today as the markets recover from yesterday’s losses. Corn is rallying nicely after the European Union threatened sanctions against Russia in protest of its advancement into the Crimean peninsula of Ukraine. This has the wheat market firmer which of course spills into corn – FYI Russia is on track to be the 5th largest exporter of wheat this year (and Ukraine is the 6th largest) so it’s a big deal. Safe to say grain traders are watching this situation closely and for the time being the cure to the uneasy, nervous feelings this situation brings is to buy buy buy.
·Corn is 3 to 5 cents higher
·Soybeans are steady (old crop) and up 10 to 15 cents on new crop.
oThis price action could be reflective of old crop sales cancellations? Even rumors about that would cause people to exit the old/new bean spread and explain what we see today
Monday, March 10, 2014, 3:30 pm Submitted by: Joel Pudenz
Pressure from the March S&D report weighed on the market today with corn down a dime and beans down 40 cents. USDA’s March Supply & Demand report didn’t have any sizable differences from February. Corn ending stock estimates dropped by 25 million bushels (from increased exports) but carryout remains above 1.4 bln bushels. South American corn production estimates stayed even with last month, which was a bit surprising with recent weather issues in Brazil.
The soybean carryout estimate was stronger than the trade expected, only dropping by 5 mln bu. to 145 mln bu.
·Imports increased by 5 mln bu.
·Export increased 20 mln. bu.
·Domestic crush decreased by 10 mln. bu.
World production estimates dropped by 2.37 MMT; 1.5 MMT of that reduction was from Brazil due to the recent weather issues. While this may feel supportive, rumors of Chinese cancellations put some heavy pressure on the market. We have returned to pricing levels traded one week ago.
Monday, March 10, 2014, 7:56 am Submitted by: Dustin Weiner
The USDA’s monthly S&D report is out later this morning (11am) and there isn’t much expected for action between now and then. Overnight the Chinese soybean market was hammered, closing sharply lower along with a bunch of other commodities that were weaker. Recent export data has been causing concerns about an economic slowdown over there – Chinese exports in February were surprisingly down 18.1% from last year in $US terms. This apparent evidence of a ‘not too healthy’ Chinese economy sent shares down 2.9% in Shanghai, with Hong Kong stocks down 1.8% and Tokyo shares closing down 1.0%.
Friday, March 7, 2014, 8:19 am Submitted by: Dustin Weiner
The funds were active again last night and after a quiet opening, the soybean market took off as funds added to their long positions. The funds are within 15-18k contracts of their largest ever long soybean position, going back to the drought of 2012 (it will be ugly when this goes away someday, right?). Corn also saw nice gains last night as May corn on the CBOT broke the $5 mark earlier this morning (and has since came down off of that).
The soybean story is an easy one to tell as the projected carryout for this summer continues to shrink in the mind of the trader. We seem unable to ration export demand, and domestic crush margins are still strong – it now feels like the US will need to import a fair amount of beans this summer to avoid a “zero” for a carryout. Chinese crush margins improving overnight just added fuel to the fire (and fund longs to our market).
Outside markets are higher with Crude Oil higher at this time (UP 53 @ 102.09) along with a lower US Dollar (138.63 vs. Euro) and the US stock market is higher (UP 82).
Corn 2 to 4 cents higher
Soybeans 10 to 20 cents higher
And oh by the way – the big S&D report is out Monday. Details for trade guesses at the below:
Thursday, March 6, 2014, 3:35 pm Submitted by: Joel Pudenz
The corn and bean markets both closed higher today with corn adding a dime and beans adding 17 cents. Corn was supported by the funds as they were net buyers of around 10,000 contracts today. Ukraine exports are continuing as normal, but the people of Crimea will vote on whether to leave Ukraine and join Russia, keeping the market nervous about the situation. Weekly export numbers this morning were 59.8 mln bu. strong – we need to average 6.6 mln bu. a week to meet USDA estimates. Our Midwest weather looks to be warming up in the monthly outlook, returning closer to average.
Beans found support and traded near the highs achieved one week ago. Sales are currently 113 mln. bu. above USDA estimates; this fundamental landscape hasn’t changed. Domestic demand for meal remains strong, we haven’t seen any significant cancellations, and the funds were net buyers of beans, oil, and meal today. Monday’s USDA WASDE Report will give more insight on out the carryout picture could change with sales, imports, and potential cancellations.
Thursday, March 6, 2014, 7:59 am Submitted by: Dustin Weiner
The soybean market was trading double digits higher and the corn market had rallied off of its lows to trade slightly positive when electronic trading paused at 7:45am -- both markets can thank the weekly export sales report for their strength. This week’s report showed strong corn sales (above average trade expectations) and decent soybeans sales, right at the top end of expectations.
While the export sales report is a nice boost of friendly fundamental news – other news is hard to find. The USDA’s March S&D report will be out this coming Monday at 11am. The trade is looking for a slight shrinking of the soybean carryout while the corn carryout looks to stay close to the same – maybe a bit bigger. Don’t be surprised if sometime between now and the weekend this market drifts lower as we get hit with profit taking ahead of Monday’s report.
Wednesday, March 5, 2014, 8:12 am Submitted by: Dustin Weiner
The grain markets were mixed last night with corn trading anywhere from a penny higher to 3c lower and soybeans trading between 3c higher and 3c lower. There isn’t much for new news out of Ukraine and so far exports out of the Black Sea area are plugging along at a normal pace. This could allow the grains to take a breather today.
Outside markets are mixed with Crude Oil lower at this time (DN 29 @ 103.04) along with a higher US Dollar (137.30 vs. Euro) and the US stock market is higher (UP 18).
Tuesday, March 4, 2014, 4:38 pm Submitted by: Joel Pudenz
Corn closed 13 cents higher today, adding 20 cents the last two trading sessions. The Ukrainian situation is still volatile, but Russian troops have pulled back from the border easing some pressure. Ukrainian grain exports have not yet been affected but the trade is still concerned over the situation. Informa decreased production estimates in S.A. by 1 MMT which provided additional support. Funds were net buyers on the day. Any strong upward moves in corn may be limited by strong carryout estimates.
Spillover support from the corn market helped prop up soybeans today with May beans closing 13 cents higher. Domestic demand for soybeans remains strong as crushers remain profitable. Informa decreased S.A. soybean production by 1.6 MMT. We see demand for beans remaining strong (China, domestic use) while the world supply is slightly lower (S.A. declines); the fundamentals remain favorable to beans. This can change with Chinese cancellations, but we haven't seen any significant cancellations yet.
Tuesday, March 4, 2014, 8:10 am Submitted by: Dustin Weiner
The grain markets had a weaker tone to them last night as news out of Russia calmed a few fears. Russian President Putin pulled back some of his troops in SW Russia and investors feel that Russia is now backing down from the potentially large-scale military confrontation. Putin himself said that Russia’s takeover of the Crimean peninsula will not escalate into war: "We will not go to war with the Ukrainian people. If we do take military action, it will only be for the protection of the Ukrainian people”. This is a fluid situation and will be watched closely.
So… today appears to be acting in direct opposite of yesterday’s trade – gold & crude are lower while the equity markets are all higher. Some of the ‘risk premium’ that was added yesterday is being swiftly removed from the market.
Spring is inching closer… today is Fat Tuesday, the Illinois and Mississippi Rivers should see continued melting as temps warm up later this week, and Brazilian soybean harvest should be half done by the weekend.