CME to Extend Grain Trading Hours
May 02, 2012
· Grains mostly lower overnight; Trading has been choppy during the first half of this week after Friday’s rally
· CME announcing yesterday that grain trading hours would be extended; The new 22 hour per-day schedule involves a short close from 4pm to 6pm CST every night; Trading will now open at 5pm CST on Sunday nights; One of the major features of this action is that markets will now trade during pivotal USDA reports; Changes take effect on May 14th, coinciding with the launch of the new ICE Exchange grain contracts
· Forecasters look for unusual warmth to continue through the end of the week for most Corn Belt areas; Heat may stress HRW wheat crop in some areas; Occasional storms hit northern/central corn areas through Monday; Cooler temps to return next week
· Outside markets mostly negative for grain trade this morning with US$ sharply higher, equities/crude/metals lower
· Export Sales tomorrow morning at 7:30am CST; USDA Crop Production on May 10th
Traders continue to wait on fresh demand news while weather conditions remain favorable. Many bulls continue to look for an extension higher in old crop corn contracts after Friday’s massive export sale. We have yet to see any major weather concern. We believe that a combination of early planting and favorable weather could result in an overall acreage increase. While we believe that a significant amount of acreage has been moved from corn into soybeans, we also believe that a 2007 type scenario, in which both corn and soybean acreage increased from prospective to final, is possible.
It’s tough to say how much of the South American weather issues are priced into the soybean market. The story has become stale in our opinion. Soybeans have very rarely been able to hold a trade above $15 for any significant amount of time. This is a fantastic opportunity for any producers holding old crop beans. As far as new crop is concerned, we feel that any sale over $13/cash is a good place to start.
As always, call the office with questions or concerns.