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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.

EHedger Afternoon Grain Commentary 8-29-2011

Aug 29, 2011

Grains finished mixed with soybeans leading the way higher.  November soybeans finished 23 ½ cents higher at $14.47, December corn 3 cents higher at $7.70, and December wheat down 2 cents at $7.95.

Soybeans continue their rally on dry weather concerns and continued technical strength after breaching a major trading range they have been stuck in.  If weather remains dry we could see much of the bullish attention switch to soybeans as carryout concerns start increasing.

Today’s crop conditions report was "bullish" again with declines in the ratings for both corn and soybeans.  We could see some strength on the overnight session from these numbers.

Crop Progress:

Corn                                                     August 29th                                         5 year average

Dough                                                         88%                                                        85%

Dented                                                         53%                                                        54%

Mature                                                         9%                                                          11%

Condition:  Down 3% from last week at 54% good-excellent

Soybeans                                               August 29th                                         5 year average

Setting pods                                                 93%                                                        94%

Dropping Leaves                                           2%                                                          6%

Condition:  Down 2% from last week at 57% good-excellent

I have included a chart of December corn with that shows the next trendline resistance level around $7.86.  With all of the crop downgrades recently the market seems to be targeting the all-time high around $8 for corn.  With corn and soybeans trying to ration demand, we can see short covering also take us higher. Ultimately high prices can be an "end" to high prices if we ration enough demand, but with supply still in question the market seems to want to stay supported.  We want to stay in sustainable positions and stay well hedged at these levels.  Soybean calls are still a good way to get upside protection in this market. If you are expecting bushels over and on top of your guarantee level and want to look at protecting these prices we have strategies available.  Please give your broker a call. 

Have a great week!

Chart 8.29.11

Best Regards,

EHedger

 

For a free trial of EHedger services including the morning automated phone call, daily afternoon market commentary, and/or a free consultation, please contact EHedger at 866-433-4371. You can also visit us at www.EHedger.com.

 

Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. 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 EHedger LLC, its affiliates, officers, directors, employees, or agents.

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