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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 1/24/13

Jan 24, 2013

Grains and oilseeds staged a late day rally off the lows of the day.  March corn finished 3 ½ cents higher at $7.24 ¼, March soybeans 1 ¾ cents lower at $14.35 ¼ (20 cents above the daily low), and March wheat 6 ¼ cents lower at $7.68 ½.

The early weakness was attributed to additional rains added to the Argentine forecast on the GFS model.  The USDA announced the sale of 510,000 MTs of new crop soybeans to China and 113,000 MTs to "unknown destinations".  These sales helped the November 2013 contract settle higher on the day.  Old crop soybeans were hard pressed for support until the very end of the trading session. Much of the weakness was blamed on reports of reduced crush margins in China.

The EIA ethanol data was better than last week but not necessarily "bullish".  We believe old crop corn needs to continue to ration feed demand and will find support on setbacks like today.  The December 1st stocks were low enough in our opinion to hold prices at least until the South American production becomes available.  We are more concerned about the price of new crop as we believe both corn and soybeans will secure additional acres this year.  Until we get through March 1st, guaranteed revenue from crop insurance is still unknown which means the next 25-30 days will be your biggest risk for those who rely on crop insurance as a main source of hedging.  If you are caught up to the current EHedger recommended sale levels we believe this is adequate coverage for this timeframe.  If you still need to place these hedges please contact us to go over some short term hedging strategies to get you through the Spring Federal Crop Insurance price-setting.  To receive the EHedger producer recommendations please sign up for a free trial by clicking here.

Wheat is still having a hard time sustaining rallies despite the competitive US pricing in the world market.  The record low winter wheat conditions this fall and the ongoing dryness may provide the necessary support into the spring. Tomorrow’s sales report will be the next directional indicator to watch.

Weekly Sales Estimates for Friday, January 25th 

Commodity Estimate Range
Corn 200,000-450,000
Soybeans 750,000-950,000
Soymeal 200,000-300,000
Soyoil 10,000-30,000
Wheat 350,000-550,000

 

March Corn

March Corn Chart

March Wheat

March Wheat Chart

March Soybeans

March Soybean Chart

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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