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January 2012 Archive for 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 1-31-2012

Jan 31, 2012

Grains rallied into the end of the trading session close finishing near the highs of the day.  For the month of January, front month contracts finished as follows: corn down 7 cents, soybeans up ½ cent, and up 13 ¼ cents for wheat.

The weather forecast for South America is still calling for favorable conditions for the following couple of weeks besides dryness for the next couple of days in Southern Brazil.

 Wheat has once again gained on corn and is now trading at a 27 cent premium to corn in the March contracts.  This is significant since it has been trading in and out of a discount to corn since June which has surely affected the amount of corn being fed in the world.  If wheat is no longer cheap enough to be a feed substitute the corn market may have to rally to ration demand.  Much of this depends on the South American crop as the market has already priced in a high risk premium for crop damage.  Obviously there has been some damage from the heat stress; the question still remains how much.

Tomorrow is the first day of the month and we could continue to see wide fluctuation like we saw today for end-of-month position squaring. We will continue to monitor export sales as well as weather in South America. Longer term we still think these rallies need to be sold for the New Crop months.  The market has relied on world weather concerns to keep us supported over the past few years. If we get the acres back from preventive plant as well as a few acres out of CRC we could easily see the increased acreage needed to replenish stocks.

We like the current EHedger recommendations which allow for much price fluctuation while still protecting a lot of your downside price risk. Please signup using the link below if you would like a free email trial of our research.

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

EHedger Afternoon Grain Commentary 1-30-2012

Jan 30, 2012

 Overall it was a "bearish" trading session with soybeans having the largest drop.  March beans fell 33 ¾ cents to $11.85 ¼.  March corn fell 10 cents to $6.31 ¾ and March wheat was only down 2 ½ cents at $6.44 ¾.

Overall the weather forecast for South America has more favorable rains expected for the next two weeks. Southern Brazil is still expecting net drying this week but next week they have adequate rains forecasted.

Wheat has once again gained on corn and is now trading at 13 cent premium to corn.  This is significant since it has been trading in and out of a discount to corn since June which has surely affected the amount of corn being fed in the world.  If wheat is no longer cheap enough to be a feed substitute the corn market may have to rally to ration demand.  Much of this depends on the South American crop as the market has already priced in a high risk premium for crop damage.  Obviously there has been some damage from the heat stress; the question still remains how much.

Tomorrow is the last day of the month and could be choppy.  We like the current EHedger recommendations which allow for much price fluctuation while still protecting a lot of your downside price risk. Please signup using the link below if you would like a free email trial of our research.

www.ehedger.com/signup/


 

Best Regards,

EHedger

866-433-4371

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.

Ehedger Afternoon Grain Commentary 1-27-2012

Jan 27, 2012

 Corn finished strong today with March up 7 ¼ cents at $6.41 ¾.  Beans and wheat on the other hand reversed some of their gains from yesterday with beans down 3 ¾ cents and wheat down 6 ¼ cents.

Before we started the day session the USDA announced an export sale of US corn to Mexico for 170,200 MTs as well as 133,200 MTs of wheat to "unknown destinations."  Weaker than expected GDP and Final Sales data was released this morning which put downward pressure on the outsides and kept grains resisted.  The corn/bean ratio spreads continued to move back in favor of corn today.  Looking at open interest we did see a slight decline in Chicago wheat contracts from Wednesday.  This doesn’t suggest the liquidation that we could have seen from the managed money.  Looking at the CFTC’s Commitment of Traders data released today we can see that the managed money increased their open interest in the Chicago wheat contract by 20,059 contracts but reduced their NET long position by 631 contracts total.  This means they are still holding a NET short position of 48,865!  Their net long position in corn on the other hand was reduced by 14483 contracts, but they are still net long 161,827 contracts. They increased their net long soybean position by 11,836 and are net long a total of 45,384.

We believe that wheat is still going to be a big dictator of the nearby corn market in the short term.  The price of energy is also a major factor to look out for.  We have been hanging around the $100 level for crude oil for some time now.  If energy prices end up getting back of towards the highs that we saw in 2011 again this should obviously have a positive effect on the nearby corn markets.  The bottom line is that we want to keep the marginal positions in the Front month contracts to a minimum and try to stick with the cash sales.  This is especially the case with a strong basis like we have.  Have a great weekend!

Chart 1-27-2012

For a free risk assessment using our AMMO Software, please give an EHedger broker a call today. The software combines your cash sales, futures/options, crop insurance, and local cash bids all while taking into account YOUR personal cost of production. Come see where your marketing plan stands.

 

www.ammoag.com 

www.ehedger.com/signup/

 

Best Regards,

EHedger

866-433-4371

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.

 

EHedger Grain Commentary 1-26-2012

Jan 26, 2012

Grains finished mostly higher with wheat leading the way again.  March soybeans finished up 9 ¼ cents at $12.22 ¾, March corn unchanged at $6.34 ½, and March wheat up 12 ¼ cents at $6.53 ½.   

Wheat continues to lead the grain markets.  Open interest has actually been RISING in the Chicago wheat contracts since Monday.  This is surprising given the huge swings in the spreads and the fact that we know the managed money was massively short coming into this week.  We think the wheat has a potential to continue to move higher on short covering and there is not much incentive to be short front month Chicago wheat.

Although it was difficult for corn to hold its highs today, the strength in wheat is certainly helping corn stay supported.   Corn has had a lot of hype lately.  We got a price break after the report which led to less producer selling.  This was followed by stronger cash bids and some export business while the price was lower. Today we reached the $6.50 cash level again in many areas and likely had a lot of cash sales contracted.  I think we will stay in the range between today’s highs and last week’s lows for the near term as producer selling steps up again.

Chart 1-26-12

For a free risk assessment using our AMMO Software, please give an EHedger broker a call today. The software combines your cash sales, futures/options, crop insurance, and local cash bids all while taking into account YOUR personal cost of production. Come see where your marketing plan stands.

www.ammoag.com  

www.ehedger.com/signup/

 

Best Regards,

EHedger

866-433-4371

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.

Wednesday's Grain Recap 1-25-2012

Jan 25, 2012

Grains finished mixed with more large moves in the spreads. March corn settled 4 ¼ cents higher at $6.34 ½, March beans finished down 6 ½ cents at $12.13 ½, and March wheat up 7 ¾ cents at $6.41 ¼.    

Not much has changed from yesterday. The market continues to move the corn/soybean spreads back in favor of corn, this time the corn is being led higher by wheat. The concern that Russia will put a tariff on wheat exports continues to float our front month wheat contracts. This is also the commodity with a massive short position held by the “managed money” and if they are indeed exiting the trade it could push this market even higher. Given the winter conditions in Russia/Ukraine, the spread between their prices and the rest of the world has probably bottomed until spring. If wheat prices around the world gain ground from this, this strength could easily transfer back over to US corn as our current supply situation becomes of higher importance/concern and that substitute is no longer an economically viable option.
Stronger wheat has been helping corn, but it has also been stronger interior cash bids. The lack of producer selling has kept the cash markets strong and futures are reflecting the strength as well. Short term I wouldn't be surprised to see the price of front month grains continue to rise between now and the first week of February.
This week we are expecting another big week for soybean exports as South American demand has switched back to US. This could be a temporary adjustment until their export business comes back on line.   Here are the average estimates for tomorrow’s Weekly Export Sales market:
Corn                              650,000 – 850,000 MTs
Soybeans                      700,000 – 850,000 MTs
Wheat                           500,000 – 700,000 MTs
Source: Reuter’s Poll
For a free risk assessment using our AMMO Software, please give an EHedger broker a call today. The software combines your cash sales, futures/options, crop insurance, and local cash bids all while taking into account YOUR personal cost of production. Come see where your marketing plan stands.
www.ammoag.com      
 
Best Regards,
EHedger
866-433-4371
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.

Tuesday's Grain Recap 1-24-2012

Jan 24, 2012

 

Wheat led the grains higher today after rumors of a Russian wheat export tax. March wheat finished 13 ¾ cents higher at $6.33 ½, March corn up 10 ¼ cents at $6.30 ¼, and March soybeans up 2 ½ cents at $12.20.
Russian exports so far are already close to 15 MMTs as the price of wheat has remained relatively cheap compared to other feed grains around the world. The market has obviously been trading a large world wheat carryout for some time now and you can see this in the massive net short position that the “managed money” currently holds in Chicago wheat. With Russia potentially creating an export tax on grain exports over 25 MMTs the market is bidding up the price of front month wheat contracts. Given the winter conditions in Russia/Ukraine, the spread between their prices and the rest of the world has probably bottomed until spring. If wheat prices around the world gain ground from this, this strength could easily transfer back over to US corn as our current supply situation becomes of higher importance/concern and that substitute is no longer an economically viable option.
Stronger wheat helped corn today but it was also stronger interior cash bids. The lack of producer selling has kept the cash markets strong and futures are reflecting the strength as well. Short term I wouldn't be surprised to see the price of front month grains continue to rise between now and the first week of February.
This week we are expecting another big week for soybean exports as South American demand has switched back to US. This could be a temporary adjustment until their export business comes back on line.
For a free risk assessment using our AMMO Software, please give an EHedger broker a call today. The software combines your cash sales, futures/options, crop insurance, and local cash bids all while taking into account YOUR personal cost of production. Come see where your marketing plan stands. www.ammoag.com                                                                 www.ehedger.com/signup/
 
Best Regards,
EHedger
866-433-4371
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.

Friday's Grain Recap 1/20/2012

Jan 20, 2012

Grains finished mixed again with more corn and soybean spreading.  March corn finished 5 ½ cents higher at $6.11 ½, March wheat up 4 ¾ cents at $6.10 ½, and March soybeans down 10 at $11.87.

We started the day session with stronger than expected export sales for corn, soybeans, and wheat.  Initially the market opened weaker despite these strong sales.  The early weakness was likely caused by another break below $100 in crude oil and unfavorable outside markets.  By the end of the day corn and wheat managed to finish higher.  Cash bids for corn continue to come in strong and have helped push the front month corn markets higher.   An increase in estimated corn acreage from Informa didn’t help the price of new crop corn.

 

Here are the following results from the Weekly Export Sales:

 

                   1/20/2012              Estimated Range

Corn             759,900 MTs           550,000 MTs - 750,000 MTs

Wheat          584,200 MTs           350,000 MTs - 450,000 MTs

Soybeans      991,100 MTs           550,000 MTs - 750,000 MTs

 

CATTLE ON FEED:            1/20/2012

Placements:                      94% as expected

Marketings:                      98%, the estimate was 97%

On Feed:                          103% the estimate was 104%

 

The CFTC’s Commitment of Traders report was also out today. The "managed money" increased their net short position in Chicago wheat by 13,827 contracts. They also decreased their net long position in corn by a whopping 47,443 contracts and lowered their net long soybean position by 11,068 contracts.  They were obviously caught long for the report and were exiting positions/and or getting short.

 

For a free risk assessment using our AMMO Software, please give an EHedger broker a call today.  The software combines your cash sales, futures/options, crop insurance, and local cash bids all while taking into account YOUR personal cost of production.  Come see where your marketing plan stands. www.ammoag.com

 

For a free trial of our research, please click on the following link: www.ehedger.com/signup/

 

Best Regards,

 

EHedger

866-433-4371

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.

 

EHedger Afternoon Grain Commentary 1-17-2012

Jan 17, 2012

Grains finished stronger with Soybeans leading the way.  March corn finished 4 ½ cents higher at $6.04, March beans 25 ¼ cents higher at $11.83 ½, and March wheat 2 ½ cents higher at $6.04 ¾.

Soybean strength was derived from some weather concerns in South America, strong NOPA Crush this morning, and stronger outside markets for the majority of the day.  We are also coming off of a large break which helped reinforced the move higher.  Even after today’s rally, soybeans are still 20 cents below where they were before last week’s report.  Corn is down 47 cents since the report, and wheat is down 36 cents.

NOPA crush came out above expectations this morning and was considered "bullish".  December Soybean Crush was 145.42 mln bu and was expected to be 140.7. Oil stocks came in slightly above expectations at 1.938 bln lbs.  Meal exports were at 608,159.

Export inspections were also strong for soybeans coming in at 40.91 mln bu when expectations were calling for 28.  Corn was at 30.05 when expectations were at 32, and wheat was at 13.43, expectations at 16.5.

The outsides were stronger on a higher Chinese GDP than expected.  For the 4th quarter the Chinese GDP was 8.9% compared to the average economist guess at 8.7%.  This helped many commodities today including a rally in crude oil and copper.

The CFTC’s Commitment of Traders report shows that the "managed money" is currently net short 35,669 contracts of Chicago wheat, net long 223,752 contracts of corn, and net long 44,617 contracts of soybeans.  They obviously have a considerably large size of net long positions in corn and in our opinion it still leaves the producer extra downside risk –should they (managed money) decide to exit their positions.

USDA REPORT:

Highlights from the report include higher corn stocks, higher corn production, higher world wheat carryout, and higher winter wheat acres in the US.  We ended up with about 240 million bushels more in quarterly corn stocks than what the market was expecting and an average corn yield of 147.2 bpa. 

So what do we expect going forward in 2012?  Well there is a lot of year left and this is just the start.  Typically the January report can have a lasting effect on the direction of the first quarter.  This report loosens some of the dependence the world was requiring out of Argentina for corn, which has been a major reason for the rally in recent weeks. We aren’t necessarily out of supply trouble just yet.  We are still down about 400 million bu corn on this report as opposed to this time last year.  But… we are looking at a front-month wheat price that is almost $1.75 CHEAPER than it is today.  The abundance and relatively cheap price of world wheat should continue to weigh on corn demand as long as the feed industry continues to have that option.  Argentina is also still projected by the USDA to produce 3.50 Million MTs more corn than last year even with the recent weather problems.

So with all that said I do think that there is still quite a bit of risk for old crop corn especially.  New crop corn could ultimately find support much sooner than old crop as it has to hold acres still.  As far as soybeans go, we did see a small decline in expected world ending stocks on the report.  Weakness in corn and wheat can still pull this market down, but for the most part the report was not nearly as bearish for soybeans.  We also have to contend with weather in South America.

Link to Quarterly Stocks: http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1079

Link to Supply and Demand: http://www.usda.gov/oce/commodity/wasde/

Best Regards,

EHedger

866-433-4371

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.

 

Post-report comments

Jan 12, 2012

The USDA reports sent corn prices sharply lower today.  Corn was hit the hardest down "lock-limit" 40 cents in the front months.  Wheat wasn’t far behind finishing 36 cents lower, and beans were only 20 ½ cents lower after coming off their lows by over 32 cents. Tomorrow the corn limits will be expanded to allow trade up to 60 cents.

Highlights from the report include higher corn stocks, higher corn production, higher world wheat carryout, and higher winter wheat acres in the US.  We ended up with about 240 million bushels more in quarterly corn stocks than what the market was expecting and an average corn yield of 147.2 bpa.  Synthetically the corn market was trading a few cents below the limit and should reflect that on the overnight trade.

So what do we expect going forward in 2012?  Well there is a lot of year left and this is just the start.  Typically the January report can have a lasting effect on the direction of the first quarter.  This report loosens some of the dependence the world was requiring out of Argentina for corn, which has been a major reason for the rally in recent weeks. We aren’t necessarily out of supply trouble just yet.  We are still down about 400 million bu corn on this report as opposed to this time last year.  But… we are looking at a front-month wheat price that is almost $1.75 CHEAPER than it is today.  The abundance and relatively cheap price of world wheat should continue to weigh on corn demand as long as the feed industry continues to have that option.  Argentina is also still projected by the USDA to produce 3.50 Million MTs more corn than last year even with the recent weather problems.

So with all that said I do think that there is still quite a bit of risk for old crop corn especially.  New crop corn could ultimately find support much sooner than old crop as it has to hold acres still.  As far as soybeans go, we did see a small decline in expected world ending stocks on the report.  Weakness in corn and wheat can still pull this market down, but for the most part the report was not nearly as bearish and this showed as the markets held more support in soybeans today.  We also have to contend with weather in South America.

Link to Quarterly Stocks: http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1079

Link to Supply and Demand: http://www.usda.gov/oce/commodity/wasde/

 

 

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

Pre-Report Comments 1/11/12

Jan 11, 2012

Soybeans finished sharply lower ahead of tomorrow’s USDA reports.  March soybeans fell the furthest, posting a 29 cent loss closing at $12.03.  March corn was down ½ cent at $6.51 ½ and March wheat was up 1 ¼ at $6.41.

Not much has changed in market fundamentals in the past 24 hours besides a little better forecast in South America.  At this point the market may be looking at the rains as more favorable for soybean production and a little late to significantly boost corn production.  It may also just have been a massive unwinding of short corn, long beans spreads.

Along with tomorrow’s USDA reports, we will also see Weekly Export Sales.  These will almost surely be overshadowed by the report, but I just want to mention them. Expectations (in 1000’s) are for 300-600 MTs of corn, 300-575 in soybeans, and 200-400 in wheat.

Looking at the most recent Commitment of Traders report, we can see that the "Managed Money" is net short 27,097 contracts of Chicago wheat, net long 192,500 of corn, and net long 33,020 contracts of soybeans.  This is still an especially large net long position in corn and all the more reason to make sure as a producer you have adequate DOWNSIDE coverage if the reports were to come out bearish.  The reports will be the best indication for direction to start the year and has caused significant market swings in the past.

I have included the market expectations below.  If there are any surprises on the stocks data, our thought is that it will be on the amount of wheat being fed, or the rationing of corn demand from these high prices.  We will have our reaction to the reports in the morning letter and morning automated phone calls. 

Report estimates are as follows (source Reuters):

Corn

Production range: 12.165 - 12.375

Average guess: 12.265 with a 146.163 yield

December USDA: 12.310

Soybeans

Production range: 3.010 - 3.200

Average guess: 3.048 with a 41.358 yield

December USDA: 3.046

 

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

Tuesday's Grain Market Recap 1-10-2012

Jan 10, 2012

Grains finished near unchanged after trading both sides of the market. March beans were down a penny, March wheat down 2, and March corn unchanged.

The weather forecast in South America was left mostly unchanged.  The lack of fresh news is keeping us at current levels and the market is waiting to see what Thursday’s report says.

Looking at the most recent Commitment of Traders report, we can see that the "Managed Money" is net short 27,097 contracts of Chicago wheat, net long 192,500 of corn, and net long 33,020 contracts of soybeans.  This is still an especially large net long position in corn and all the more reason to make sure as a producer you have adequate DOWNSIDE coverage if the reports were to come out bearish.  The reports will be the best indication for direction to start the year and has caused significant market swings in the past.

I have included the market expectations below.  If there are any surprises on the stocks data, our thought is that it will be on the amount of wheat being fed, or the rationing of corn demand from these high prices.

Report estimates are as follows (source Reuters):

Corn

Production range: 12.165 - 12.375

Average guess: 12.265 with a 146.163 yield

December USDA: 12.310

Soybeans

Production range: 3.010 - 3.200

Average guess: 3.048 with a 41.358 yield

December USDA: 3.046

 

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

Monday's Grain Market Recap 1-09-12

Jan 09, 2012

Weather is again bringing strength to the grains. March corn was up 8 ½ cents at $6.52, March soybeans up 36 ½ cents at $12.33, and March wheat up 17 cents at $8.41 ¾.

Over the weekend Southern Brazil and Argentina continued to have hot and dry conditions which have helped push this market higher. The two-week outlook looks a bit drier again which is helping to provide even more support to this market. The rallies were unable to take out last week's highs, but we did see corn breach the 100 day moving average momentarily before giving up 11 cents of those gains (chart included below).

As the market continues to be flooded with poor conditions from South America, we also have a couple of major reports coming this week. The Quarterly Stocks report as well as the Monthly Supply and Demand report will both be released on Thursday. I have included the expectations below. If there are any surprises on the stocks data, our thought is that it will be on the amount of wheat being fed, or the rationing of corn demand from these high prices.

Report estimates are as follows (source Reuters):

Corn

Production range: 12.165 - 12.375

Average guess: 12.265 with a 146.163 yield

December USDA: 12.310

Soybeans

Production range: 3.010 - 3.200

Average guess: 3.048 with a 41.358 yield

December USDA: 3.046

Chart: March corn - we continue to find some resistance at that 100 Day Moving average. It may take a bullish report to bring us above those levels.

 

Chart: March soybeans - The 100 Day Moving average is currently at $12.50 and may be where we find short term resistance before the report.

 

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

Friday's Grain Recap 1/06/12

Jan 06, 2012

It was a rather weak close especially for soybeans as they made their day session lows in the final minute of trading.  March beans closed down 12 ½ cents at $11.96 ½, March corn unchanged, and March wheat down 4 ½ cents at $6.24 ¾.

Poor export sales this morning was the first thing to take grains off their overnight strength.  After a choppy, 2 sided trade they finished weaker.  Sales were below the average trade guesses for corn, wheat, and soybeans.  Informa also released their production estimates today.  Their estimates came in at 12.337 for corn and 3.078 for soybeans.  Both of these estimates are slightly higher than the latest USDA’s estimates.  They did however lower world corn production 5 ½ million MTs due to lowering estimated yields in South America.

South American weather was left mostly unchanged today.  They are still expecting favorable rains early next week with hot and dry conditions until then.  The extended forecast (low confidence) is putting some light rain chances out past 2 weeks.

Employment numbers were favorable this morning but the stock market couldn’t seem to hold onto any rallies and didn’t help grains any.  The Dollar was higher for most of the day as well.  With so much uncertainty in Iran, weather problems in South America, and a large report out next Thursday, the market may continue to hold support until we get more confirmation about the crop size.  This actually puts additional importance on the report. 

Report estimates are as follows (source Reuters Poll):

Corn

Production range:        12.165 – 12.375

Average guess:            12.265 with a 146.163 yield

December USDA:          12.310

Soybeans

Production range:        3.010 – 3.200

Average guess:            3.048 with a 41.358 yield

December USDA:          3.046

We will have more updates for you as we get closer to the report.  Have a great weekend!

 

www.ehedger.com/signup/

Best Regards,

EHedger

866-433-4371

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.

 

Tuesday's Grain Market Recap 1-03-2012

Jan 03, 2012

Supportive outside markets and dry weather in South America continue to push grains higher.  March Corn finished 12 cents higher at $6.58 ½, March soybeans finished 19 ¾ higher at $12.27 ½, and March wheat up 4 ¼ at $6.57.

Argentina missed much of the rains expected over the weekend AND the forecast is calling for another 8-9 days of net drying.  Southern Brazil is also looking at poor conditions and is contributing to the strength today.  The Mid-day weather was left mostly unchanged.  This combined with sharply higher outside markets were the main reasons for the sharp rallies in grains.

The Dow Jones futures were up sharply on positive economic data out of China.  We did see a huge jump in the price of crude oil today on the economic news as well as threats made by Iran to close the Straits of Hormuz.  This helped the market keep corn supported as well.

Grains hit the highs of the day in the first 5 minutes of the trading session.  March corn touched the 100 day moving average of $6.63 ¾ and held resistance from there.  March soybeans are getting close to their 100 day moving average of $12.57 ¼.

We may see first-of-year buying continue to support the market this week.  Until we get to the January 12th report grains may also continue higher as the market tries to price in more risk premium. Much of this will depend on the weather in South America. If you have any questions, please give your EHedger broker a call.  Happy New Year and have a great week!

Chart: March Corn

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Best Regards,

EHedger

866-433-4371

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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