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EHedger Report

RSS By: Dustin Johnson

Dustin works with a wide net of large producers throughout the Midwest. His analytical market approach and objective hedge strategy development is specific to the needs of every individual.

Soybeans make new highs; corn and wheat unable to follow 8/05/09

Aug 05, 2009
 
SETTLEMENTS 8/5
         
 
Sep 09 Corn
346 ½  
- 8
Dec 09 Corn
356 ¾
- 9
Aug 09 Beans
1174 ¾  
+ 9 ¾  
Nov 09 Beans
1045 ¾  
+ 14 ¼
Sep 09 Wheat
529 ¼  
- 13
Sep 09 KC Wheat
560 ¼ 
- 12 ¾
Sep 09 Min Wheat
605 
- 15
Dec 09 Meal
317.8
+ 6
Dec 09 Oil
38.11
-0.06
 
 
 
 
 
 
 
 
 
 
 
 
 






                Corn and wheat closed lower and soybeans closed higher. All three markets opened higher after a higher trade overnight. Lower outside markets and sharply lower meat markets drove prices lower shortly afterwards. The recent rally in grain prices and continued “collapse” in hog prices and Milk prices have quickly erased any hopes for those producers of having any profit margins. Eventually, something will need to “give”. Either the producers will need to liquidate more or grain prices will need to have a serious break. Right now, it looks like we could see a combination of the two.
 Informa also came out with some production estimates around 10:30. They estimate the national corn yield at 157 and the soybean yield at 41.6 currently. If weather remains favorable however, they estimate final yields at 164 bu./acre for corn and 43.5 bu./acre for soybeans. This had mixed reactions and caused the soybeans to trade from 10 higher to 10 lower and back to 15 higher on the close. Corn and wheat broke sharply after the Informa numbers and were never able to fully recover. Late buying in the soybean complex helped soybeans close on new highs for the move and pulled corn prices 8-cents off of the lows. Soybeans are still the favorite and buying continues to enter late in the day. Soybeans are still flirting with some very large technical price levels and the bulls are trying very hard to get prices above these levels in the hope of drawing in some additional buying. The dollar index made new lows for the move and the stock market rallied very sharply as we went into the close. Money continues to chase all of the markets in tandem, and this continues to provide opportunities in our markets. 
The extended weather models continue to struggle with a solid outlook for the weeks ahead. Most have a strong system over the next 60 hrs to impact 70% of the Midwest, with exact locations still fuzzy. Then most models have a “ridge” setting in over the Midwest during this coming weekend. Then the models differ. Some are calling for a continued ridge and others are calling for a return to cool and wet conditions. Obviously these two different scenarios will have very different impacts on the crops. These weather “runs” come out every 12 hrs. and this is responsible for some of the sudden moves we are seeing as well. We put out some new hedge recommendations today, so make sure you have read them and give us a call if you have any questions.
 
 
 
 
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Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. The market information contained in this message has been obtained from sources believed to be reliable, but is not guaranteed as to its accuracy or completeness. Market information may not be consistent with current or future market positions of E Hedger, its affiliates, officers, directors, employees, or agents. Recipients assume the risk of reliance on and indemnify and hold E Hedger harmless for any and all losses, costs, or tax consequences incurred as a result of their use of market information.
 
 
 
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COMMENTS (2 Comments)

Anonymous
161

9:42 PM Aug 5th
 
Anonymous
Anyone want to take the over on a 162 bu/acre national yield? Informa says 164...you get a 2 point cushion! Whatever you wanna bet...
4:29 PM Aug 5th
 
 
 
 
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