FC Morning Grain Market Commentary for 6/10/2014

MARKET COMMENTARY

AM Comments 06/10/14

Tuesday, June 10, 2014, 7:06 AM
Submitted by: Dustin Weiner

The corn and soybean markets this morning are both trading near steady, with corn trading a touch higher while beans are a touch lower.  The next big piece of fundamental news will be out tomorrow – the USDA’s monthly S&D report. 

 

Generally speaking the market isn’t expecting major changes in this report.  In regards to old crop corn – ethanol/export demand feels like it has remained firm while feed demand likely won’t get changed until after the June Quarterly Stocks Report.  The old crop soybean carryout isn’t expected to move much either – although both crush and exports appear to be running above the projected pace that the USDA had projected, the somewhat unknown (and maybe exaggerated) import numbers could keep this report from being overly bullish.  In regards to new crop carryouts? It is probably too early for them to start raising production estimates, but if the weather stays like this – those will most likely be coming. 

 

Overall this report tomorrow could/should show slight reductions in old-crop carryouts for both corn and soybeans.  While this initially could be viewed as friendly to prices – the market will likely shift it’s focus back to weather and crop development shortly afterwards.  For today – we are seeing a bit of short covering in corn ahead of the report which is causing the front end of the market to hold its ground.  Other than that – it is quiet.

 

Opening Calls

Corn steady to 2c higher

Soybeans 1 to 3 cents lower

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2150

 

 

FC Afternoon Grain Market Commentary for 3/26/2014

Afternoon Comments 3/26/2014

Wednesday, March 26, 2014, 3:09 pm
Submitted by: Joel Pudenz

Good Afternoon!

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.

Corn closed down 2 cents at $4.845

Beans closed up 12 cents at $14.40

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=2058

Morning Grain Market Commentary for 12/13/2013

Morning Comments 12/13/2013

Friday, December 13, 2013, 8:26 am
Submitted by: Kyle Lehman

The markets continue to slide lower on carryover weakness from yesterday’s trade. Soybeans are leading the way lower (down 10c) on fears of reduced demand from China due to new cases of bird flu. With demand slowing and margins being squeezed the trade expects some cancellations from China in the next 4-6 weeks. Corn futures remain under pressure after a group of 10 bipartisan senators proposed a bill to completely eliminate the corn ethanol mandate. Ethanol margins remain at 2 year highs and production should remain at capacity even with all the news of RFS reductions/eliminations. The world seems to be swimming in wheat confirmed by last week’s USDA S&D. Wheat prices have fallen 7% in December which is weighing on the corn market.

 

The US weather looks to warm up early next week before another cold wave moves through. Although most of Iowa will still remain below freezing temps upper 20’s will be a small relief to the single digit highs we have seen lately. South American weather is expected to be hot and dry over the next 10 days which should allow late plantings to finish up. The 11-15 day forecast follows up with some chances of decent rain.

 

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1947

 

FC Morning Grain Market Commentary for 10/11/2013

AM Comments 10/11/13

Friday, October 11, 2013, 7:59 am
Submitted by: Dustin Weiner

Good morning!

 

Lower markets, a lot of news out there reacting to an EPA proposal to lower the RFS mandate for 2014 to blend 15.21 billion gallons of renewable fuels (compared to 16.55 billion gallons in 2013) amid complaints from refiners that statutory mandates would exceed their ability to blend it into fuels without putting engines at risk. 

 

These numbers imply that the mandate for regular corn ethanol would drop to 13.0b gallons in 2014 from 13.8b gallons in 2013.  Not sure how bearish this really is to pure corn ethanol as this is just a mandate, not a cap.  If there is market for it corn ethanol, and there is a margin in it, we will keep producing it and blending it.  There are a lot of moving parts to this proposal and it still needs to be voted on before anything can happen and… the govt isn’t open.

 

FYI there are normal market hours on Monday (Columbus Day) even though the banks are closed.

 

 

Opening Calls

Corn 3 to 5 cents lower

Soybeans 4 to 6 cents lower

 

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1879

FC Morning Market Commentary for September 6, 2013

AM Comments 09/06/13

Good morning!

Our markets are bouncing a bit this morning ahead of the heat forecasted for this weekend and into next week.  Soybeans yesterday worked lower during the early part of the session, only to find renewed spec buying interest.  The traders remain bullish soybeans and will look to defend that position when they can.

The fundamentals in the corn market still appear bearish (negative) thanks to strong yields, a poor chart and slow demand.  The traders who are buying corn these days are probably hoping that soybeans will pull prices higher, but so far that isn’t working.

We had a jobs report out this morning that was negative – but the stock market is trading higher after its release.  The thought process behind that centers around the idea that if the economy isn’t turning around, the gov’t will have to continue their stimulus plans, so… buy buy buy.

The weekly export sales report was out at 7:30am, we saw solid sales on new crop soybeans and disappointing corn sales.  Informa (a well followed private company) will release their crop production estimates later today (usually late morning).  The USDA of course comes out with their numbers next Thursday.

Opening Calls

Corn 1 to 3 cents higher

Soybeans 4 to 6 cents higher

Have a great day!

Dustin Weiner

@fccoopgrain

FC Morning Grain Market Commentary for 8/29/2013

8-29-13 AM Comments

Thursday, August 29, 2013, 7:57 am
Submitted by: Jon Setterdahl

Overnight markets a bit lower as forecasts reducing heat and adding rainfall for early next week.  This week has been quite the flip-flop affair for prices, almost solely due to weather. This weather spell has undoubtedly hurt yield potential in the western corn belt, but on the other hand….has sped up crop maturity for all. Corn harvest from KY south is happening now with most yield reports very good down there. Something over 1,000 barges of southern new crop corn, mainly from AR and LA, will be making their way NORTH very soon for Midwest corn milling and ethanol plant destinations. Weekly export sales were good for new crop grain, however old crop had net cancellations of business.

Opening calls a little lower, but will watch mid-day forecasts closely.

Have a good day.

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1831

FC Morning Grain Market Commentary for 8/16/2013

AM Comments 08/16/13

Friday, August 16, 2013, 8:24 am
Submitted by: Dustin Weiner

Good morning!

 

Yesterday we were given a very nice futures rally and the market relaxed a bit overnight – trading a little weaker in corn, soybeans and wheat.  As of right now, Nov beans are approximately 80c higher than they were at the close a week ago today.  Corn’s rally hasn’t been quite as impressive, but it is 13c higher than a week ago and Dec corn slipped above its 20-day moving average yesterday (the 1^st time since June that has happened). 

 

The story is pretty simple – the market is starting to truly question the USDA’s production estimates for next year.  Prevent plant acres were the story yesterday (it surprised a few in the trade, although not everyone) and some are really starting to wonder about potential soybean yields… largely due to the warmer weather forecasted for next week with no sign of moisture in the 10-day outlook. 

 

Speaking of weather… the 6-10 day outlook shows a return to normal temps with below normal moisture for most of the Midwest.  The longer term forecasts look similar, maybe even above normal in temps with normal to below normal precip. 

 

In biofuel news, yesterday the U.S. gov’t inaugurated a plan to boost low sugar prices and mitigate a costly sugar surplus.  In this “Sugar for Ethanol” program they will buy unwanted sugar and sell it at a loss to ethanol makets to produce more biofuels.  This is the first time the Ag Dept. used the Feedstock Flexibility Program with the goal of making sugar into a biofuel feedstock (similar to what they do in Brazil).  Some are thinking that 60-70 million bushels of corn demand could be displaced by sugar.

 

Opening Calls

Corn down 3 to 4 cents

Soybeans down 3 to 4 cents

 

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1814

FC Afternoon Grain Market Commentary for 8/12/2013

PM Comments 08/12/13

Monday, August 12, 2013, 3:16 pm
Submitted by: Dustin Weiner

Good afternoon!

 

The USDA’s August S&D report was out this morning, and was a bit surprising to the market.  Starting with corn… the harvested acres did not change, but the projected corn yield dropped 2.1bpa down to 154.4.  There were many private companies who were actually projecting an increase in corn yield – thanks to the great conditions in the eastern corn belt and the decent conditions in the West.  This dropped production by 187 million bushels (when compared to last month’s numbers).  It is important to note that if this comes true, this would still be a record large U.S. corn harvest.  The current ending stocks projections for next year went down of course, but are still at 1.837 billion bushels – the largest in 8 years.  For reference, our carryout projection for this summer is only 719 million bushels.  In the grand scheme of things, the numbers we saw today aren’t necessarily friendly overall, but for today – it pushed corn a little higher as production was slightly less than expected.

 

As for soybeans… as planned, they resurveyed soybean planted acres and dropped the total acres planted and harvested by 500,000 acres.  They also dropped projected yield by 1.9bpa, down to 42.6.  This lowered production by 165 million bushels (when compared to last month’s numbers).  None of this was overly surprising but it confirms a fear that the market has had for a short while now – that the soybean crop size potential may be slipping.  Ending stocks projections for next year fell 75 million bushels (when compared to last month’s number) down to 220mb.  For reference, our carryout for this summer is 125mb, so even though it is a little tight next year – it is definitely manageable. 

 

The USDA’s weekly crop conditions report was out this afternoon at 3pm.  US corn G/E ratings were unchanged and soybeans G/E ratings were also unchanged – both at 64% good-to-excellent.  This was as expected.  Below are graphs showing how we track versus previous years – both in respect to the U.S. and to the state of Iowa. 

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1807

 

FC Afternoon Grain Market Commentary for 8/7/2013

Afternoon Comments 8/7/2013

Wednesday, August 7, 2013, 3:17 pm
Submitted by: Kyle Lehman

If you look back through your comments over the past 12 or so trading sessions you will see a common theme..markets lower and non-threatening weather. Well today is nothing new so I won’t bore you with the same story that has been told the past several weeks. However, the bearish tone of cooler temperatures may start to turn bullish if the trend continues. Talks have started to shift over to a late planted crop with development weeks behind normal being very susceptible to an early frost/freeze. If the below normal temperature trend persists could we see an early frost? Only time will tell.

 

Ethanol data this week was neutral although production did pick up 2.5% from last week. Corn used this week for ethanol production was 89.6 mln bu vs 103.1 mln needed to reach the USDA projection. At this point it is unlikely the USDA projection will be reached considering many ethanol plants are scheduled for maintenance down time the next two months. China approved the importation on GMO from Argentina today which will add a little pressure to US markets where corn is currently 50-75 cents higher priced than South America and the Black sea region.

 

August weather outlook continues to look favorable for soybean development providing the continued bearish tone. Similar to corn the market will watch for any indication of an early frost which could be more detrimental to soybeans where a significant portion didn’t get planted until late June/early July. USDA announced yet another new crop soybean purchase from China of 220k MTs.

 

Outside markets were mixed with the dollar and equities trading lower on uncertainty of when/if the fed will begin to reduce the QE3 bond buyback program. Crude traded weaker today while metals mostly higher.

 

http://www.fccoop.com/markets/commentary_detail.cfm?CommentaryID=1802