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November 2012 Archive for Grain Hedge

RSS By: Brock Schimbeno, AgWeb.com

Grain Hedge is a self-directed discount brokerage that saves farmers money when trading in the futures and options market. For $7 commissions per side producers can execute their marketing strategy with authority, any time the markets trade.

Technical Selling/Resistance Push Grains Lower

Nov 30, 2012

Grains ended the day lower with wheat leading to the downside. Technical selling pressured the markets as corn, soybeans, and wheat all met resistance levels. The cash market does not show any major trends other than around the Mississippi River. The area north of St. Louis and south of Cairo are moving in different directions as far as basis is concerned. Tune in for these topics and more.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/30

Nov 30, 2012

Cody and Logan discuss a grain market that traded lower across the board today after running into technical resistance and weak fundamentals late in the week. On today's show they discuss where we might find price support and look into weekly basis changes.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Export Sales Disappoint, Resistance Slows Rally

Nov 29, 2012

Grains ended the day mixed with corn and wheat moving lower, while soybeans held onto some gains. Export sales missed the mark across the board leading to the downturn late in the session. Some key resistance levels were tested in today's trade, but held for the time being. Tune in for these topics and more.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/29

Nov 29, 2012

Corn and wheat both moved lower while soybeans held on to positive territory into the close. Cody and Logan discuss the technical and fundamental factors driving the trade today.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Ethanol and Technicals Do Little to Move Grains

Nov 28, 2012

Grains were positive early in today's session driven by a 290,000 MT soybean sale to China. Ethanol numbers were down and some technical levels are providing resistance. Export sales are out tomorrow morning. Tune in for these topics and more.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/28

Nov 28, 2012

Grains took a breather today after picking up good ground in yesterday's action. Cody and Logan discuss what we saw today, expectations for tomorrow's export sales report, and what the coming weeks might bring.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Wheat and Soybeans Lead Grains Higher

Nov 27, 2012

The Kansas City and Chicago wheat spread widened by another 7 cents in today's action. Another downgrade of 1% in the good-to-excellent rating for the winter wheat crop pushed this spread out further. Planting delays in South America and soybean oil sales drove soybeans higher. Some technical areas to watch are discussed. Tune in for these topics and more.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

KC, CBOT Wheat Spread Is One to Watch

Nov 26, 2012

The Kansas City and Chicago wheat spread widened by 5 cents in today's action. Another downgrade of 1% in the good-to-excellent rating for the winter wheat crop could push this spread out further. Export inspections missed expectations across the board leading to late session selling. Tune in for these topics and more.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Market Moves Higher During Short Trade Session

Nov 23, 2012

In a short trade session we saw DEC corn up 4, JAN soybeans up 8 1/4, and Chicago wheat up 2 cents. Tune in to get Logan and Cody's take on what was moving the markets and what these moves mean on light trade volume.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Morning Call - 11/23

Nov 23, 2012

This morning's strong export sales for corn and wheat should support things in the early going. Cody and Logan discuss what will be moving the grain market on this short trade day. Markets to open at 9:30 CT and close at 12:15 CT.

PRESS THE PLAY BUTTON TO HEAR THE MORNING CALL

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Choppy, Two-Sided Trade Ahead of the Holiday

Nov 21, 2012

A quiet day ahead of the Thanksgiving day holiday. Choppy, two-sided, and low-volume trade was a staple of the markets today.  Ethanol and Chinese import figures drove the grains from a fundamental standpoint. The market will be closed tomorrow for the holiday and reopen from 9:30 AM to 12 PM CT Friday. Tune into GrainTV for a full breakdown.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/21

Nov 21, 2012

Today was a mixed day in the grains with the market moving higher early on only to sell into the close. We ended the day with soybeans down 5 1/2, corn down 2 1/2, and Chicago wheat unchanged. Logan and Cody discuss today's action and where things might be headed. Have a great holiday, we'll see you on Friday.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Oil World, Technical Buying, Basis Levels Turnaround Grains

Nov 20, 2012

The grains rallied sharply mid-session to turnaround losses from the overnight trade. Sparking the rally was Germany-based analyst Oil World downgrading anticipated South American production by 3 million metric tons. Aiding the ascent was technical buying and strong basis levels south of Cairo, IL. Tune into GrainTV for a full breakdown.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/20

Nov 20, 2012

What started as a quiet day in Chicago turned around, with soybeans ending the day up 18 1/2 cents to 1413 1/4. Corn and wheat both moved slightly higher but saw lower trade volume than soybeans when compared to recent trade days. Logan and Cody discuss the market close and where things might be headed.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Outside Markets, Weaker Dollar Supportive of Grains

Nov 19, 2012

There were several drivers of the markets today including China halting sales from state reserves, Brazilian shipping delays, and Export Inspections. Outside markets were supportive as was a sharply weaker dollar. Tune into GrainTV for a full breakdown.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/19

Nov 19, 2012

Grains, energies, metals, and outside markets all picked up ground today as the dollar index move sharply lower. Last trade just a moment ago saw corn up 13 cents to 740, soybeans up 12 3/4 to 1396 and Chicago wheat picking up 4 cents to 842. Tune in to this afternoon's closing grain call to hear what fundamental news was driving this grain market.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Corn Picks Up Ground As EPA Keeps Ethanol Mandate, Chinese Cancellations Pushes Soybeans Lower

Nov 16, 2012

This afternoon Brock and Logan of Grain Hedge discuss a trade day that was filled with fundamental movers of the grain market. Have a great weekend, we will see you back here on Monday.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/16

Nov 16, 2012

Corn ended the day up 5, beans down 18, and Chicago wheat was off 10. Cody Bills and Logan Burgess of Grain Hedge discuss what they saw in the grain market today and what next week might bring. Have a great weekend, we will see you back here on Monday.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Ethanol Numbers and Technicals, What Drove the Market Today?

Nov 15, 2012

Cody and Logan discuss today's action in the grain market. Ethanol production and stocks are discussed, as well as the technical outlook for corn, soybeans and wheat. Tomorrow features the weekly Export Sales eport and the monthly Cattle on Feed report. Tune in for this and much more!

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/15

Nov 15, 2012

A lot of red on the board today in the grains, Cody Bills and Logan Burgess of Grain Hedge discuss today's moves and what is going to be weighing on this market moving forward.

PRESS THE PLAY BUTTON TO HEAR THE CLOSING CALL

grain hedge topper

THERE IS A SUBSTANTIAL RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Morning Call - 11/15

Nov 15, 2012

Corn and beans are moving lower in the early going, strength out of the cash market continues after harvest. Listen to this morning's Grain Call to get Grain Hedge analysts take on where things are headed.

PRESS THE PLAY BUTTON TO HEAR THE MORNING CALL

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Consolidation Was the Theme In Today's Trade

Nov 14, 2012

Brock and Logan discuss today's action in the grain market. At the time of this posting we have DEC corn unchanged, JAN soybeans up 3 3/4, and DEC CBOT wheat down 1/4 to start the night session. Please tune in for the analysts' breakdown and what to look for the remainder of the week.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - 11/14

Nov 14, 2012

Corn, soybeans, and KC Wheat all held positive ground into the close today as Chicago wheat ended the down 2 cents. Cody and Logan discuss the close and what fundamental and technicals were driving the grain market today.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Morning Call - 11/14

Nov 14, 2012

This morning we discuss a grain market that is moving higher across the board and looks to have found a near term bottom. Cody Bills and Logan Burgess discuss the moves from the overnight and what is going to be driving the market in today's action.

Update: NOPA crush for October comes in at 153.5 million bushels -- beating analyst expectations of 147.7 million bushels. China returns to export market, buying 120,000 MT soybeans.

Click the play button below to hear today's Morning Grain Call

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Beans Test $14 And Bounce Back, Is This A Bottom?

Nov 13, 2012

Cody and Logan discuss today's action in the grain market, and where this bean market may be headed.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS. FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS. PLEASE READ OUR RISK DISCLOSURE.

Closing Call - Nov. 13

Nov 13, 2012

Corn, soybeans, and wheat all traded lower before rebounding into the close. Cody Bills and Logan Burgess of Grain Hedge call the market close and discuss what will be moving the grain market this week. Is this a bottom for January Soybeans? Listen to today's broadcast for their take.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Turnaround Tuesday Fails to Support Grains

Nov 13, 2012

Grains are sliding lower after a tough Monday that saw corn trade down 20 cents, and soybeans down 43 cents. At the moment we have corn down 2, soybeans up  3 1/4, and wheat trading 11 cents lower. At 10 AM Central Time the USDA will release the weekly export inspections report. Market Expectations are as follows:

Corn: 13.0-17.0 million bushels

Soybeans: 53.0-59.0 million bushels

Wheat: 12.0-14.0 million bushels

Last Friday's November WASDE report showed the USDA raising their projection for soybean exports by 80 million bushels for the current marketing year. It will be important to see confirmation of these expectations in the weekly export inspection and export sales report moving forward. Corn was left unchanged, and projected wheat exports were lowered by 50 million bushels in Friday's Report.

RSI

27 period RSI in "Oversold Territory"

Technically we saw the January soybean contract reach oversold territory according to the RSI indicator. The picture below was taken from Firetip, and you can see with yesterday's action the 27 period RSI reached 26, with any point below 30 being considered "oversold". This was the first time we have seen the RSI below 30 since October 2011. Not surprisingly we are seeing a snap back in today's trade, and it might not be a bad idea to look at picking up puts for downside protection on any rally. In yesterday's trade we saw a $14.00 January soybean put trade up from 18 to around 34 cents, highlighting the importance of buying puts on rallies rather than on down days in the market.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Will Beans Break $14??

Nov 12, 2012

Cody and Brock discuss recent selling in the grain market and where we might find a bottom. Tomorrow we will get Export Inspections and Crop Progress, both delayed a day with the Veterans Day Holiday.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

JAN Soybeans Test $14 as Fundamentals and Technicals Turn South

Nov 12, 2012

SA912

Grains are trading lower across the board this morning with January soybeans leading things to the downside. Right now we have JAN beans down 36, DEC corn down 5, and DEC Chicago Wheat down 9. Outside markets are quiet this morning, with the Dollar Index, gold, and crude oil all trading relatively unchanged. The grain market has turned back to fundamentals, and this week should provide good conditions for Southern Brazil and Northern Argentina to make progress on getting their corn and soy crops planted. In Friday’s WASDE report the USDA left production estimates out of both countries unchanged for corn and soybeans, giving the bulls little incentive to buy on questions about production as we are still very early in their growing season. South American production is expected to help replenish short global grain stocks, so production will be watched very closely.

With it being Veterans Day we will get the export inspections report tomorrow, which will be looked at closely after the USDA raised soybean and lowered wheat export expectations in Friday's WASDE report.

Technically we have the 50 day moving average crossing the 100 day moving average on the front month of corn, soybeans, and Chicago wheat in the coming days. Technical traders are going to look at this as a very strong sign that we are now in a bearish market move for the grains, but from a fundamental standpoint you can’t ignore the very tight corn and soybean stocks right now. Look for strong technical support at $14 / bu. On the January soybean contract from highs printed in August of 2011 and April/May of 2012.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

 

 

USDA Report Pressures Beans Down 44 Cents - Where Do Things Go From Here?

Nov 09, 2012

This morning's USDA report left corn and wheat relatively unchanged but pressured soybeans down 44 cents on the January contract. Today on GrainTV we break down what was pushing the trade today and what is coming down the line for the grain complex.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

USDA Report Bearish Beans

Nov 09, 2012

A lot of red across the board this morning after the USDA's November Crop report. Ending stocks for soybeans come in well above trade expectations, and at the moment we see the January contract trading down 22 cents. USDA raised soybean export expectations by 80 million bushels, crush by 20 million bushels, but a yield estimate a full bushel per acre higher than trade expectations resulted in ending stocks coming in at 140 million bushels vs the 130 million expected.

Less fireworks this morning for corn and wheat. Corn is trading unchanged but wheat is down 9 cents in Chicago and and 8 1/2 in KC. Ending stocks for US wheat was raised 50 million bushel as a result of a 50 million decrease in exports, and we had Ukraine export expectations raised to 6 MMT.

Full analysis later today on GrainTV...

Highlights From This Morning's Report:

  •  Soybean ending stocks at 140 million bushel (131 average trade expectation)
  •  Soybean yield bumped to 39.3 BPA (38.164 average trade expectation)
  •  Corn going to ethanol left unchanged
  •  Corn yield bumped to 122.3 BPA (inline with trade expectations
  •  Harvested acreage for corn/soybeans/wheat unchanged
  •  Brazil and Argentina soybean production left unchanged
  •  Brazil and Argentina corn production left unchanged

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

GrainTV USDA Report Preview

Nov 08, 2012

Cody and Brock discuss this morning's export sales report and what to expect out of Friday's USDA report. Click the link below to get live quotes going for tomorrow's report, and tune in tomorrow morning for full analysis of the USDA numbers.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Poor Export Sales Help Push Beans Below $15/bu.

Nov 08, 2012

Mid-Morning Update -- 9:40 AM Central

This morning's export sales numbers have helped extend losses from the overnight session in the grain complex. At the time of this post we see DEC corn down 2, DEC Chicago wheat down 3, and JAN soybeans leading the way lower -- down 8 1/4 cents. Export sales for soybeans came in at 191,000 MT (600k-800k expected) and corn saw exports meet expectations coming in at 209,000 MT.

grain hedge topper

With this move the JAN soybean contract is now below the psychological $15/bu. mark, and it will be important to see a strong close below $15 to indicate things are going lower. Technically speaking, we see the the 50 day moving average expected to move below the 100 day moving average for the first time since October 2011. This is certainly a different marketing year, but last year this technical indication was followed by lower prices before production concerns from South America rallied prices.

Below is a screen capture from the Firetip trading platform showing market depth on the JAN soybean contract. The VAP column shows the number of trades made at each price level, and you can see that the lower trade today, so far, has been 6 trades made at 1498 1/4. Firetip's "Advanced Trader" is a great way to fine tune the price you enter or exit the market, and we have a lot of producers that have been using it to modify limit orders on their hedges. If you want this market access in your home or office for tomorrow's report take your no-obligation trial today!

beans118

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Expectations for Friday's USDA Report - Part 2

Nov 07, 2012

With the US Presidential elections now behind us, the attention is now back on Friday's USDA report, the pending "Fiscal Cliff" and continued Euro zone issues. In today's action we saw outside markets tank, grains hold on, and wheat actually picking up some ground. Cody and Logan breakdown today's action, what is coming down the line for the grain market, and expectations for Friday's USDA Report.

 

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Expectations For Friday's USDA Report - Part 1

Nov 06, 2012

This afternoon Brock and Logan discuss the day's trade in the grain market and discuss what to expect out of ending stocks from Friday's WASDE. Tune in tomorrow for a further breakdown of demand side numbers the trade is expecting. Want live quotes for this Friday's USDA World Agricultural Supply and Demand report? Take a no-obligation 14 day trial of our trading software today!

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Grains Higher in Overnight Session

Nov 06, 2012

 Grain markets traded higher for much of the overnight session after suffering losses in Monday’s day session. Monday’s big loser was soybeans as South America’s growing conditions continued to be favorable. Weather forecasts call for rains were it has been dry, and dry weather were it has been wet helping South America farmers get soybeans planted.

In addition, on Monday South America crop consultant Celeres pegged the Brazil soybean crop at 79 MMT holding its forecast from a month earlier as planting picks up.  Celeres said it expected the area planted to grow to 27.44 million hectares, up 8.4 percent from a year earlier, as farmers favor soy over corn and cotton because of high prices for the oilseed.  Farmers have planted 37 percent of the crop, up from 27 percent a week ago but below the 48 percent that had been planted a year earlier

Corn continues to be range bound as exceptionally tight stocks coupled with weakening demand leave the market with little direction stimuli. Traders will likely wait for Friday’s USDA crop report to get further guidance on price direction.   Given the poor state of exports for corn, it seems probable that USDA may use Friday’s report to cut export forecasts. In addition, many analysts are expecting USDA to raise their corn production forecast which would lead to higher ending stocks.

The wheat market was also higher in night trading as poor U.S. crop conditions continue to underpin the market. USDA’s crop condition scores released Monday after the market closed point to only 39% of the wheat crop in good-to-excellent condition, off from 40% last week and 49% this time last year.  Wheat markets have also responded to crop concerns in Russia and the Ukraine. Analysts at JPMorgan estimate that Russia and Ukraine would export only 1.7 MMT of wheat between December and next June, down from 11.6 MMT a year earlier. The lack of sales from the so-called Black Sea region is likely to push up prices elsewhere in the world as importers, particularly in the Middle East and north Africa, turn to alternative suppliers, which could give U.S. wheat exports a push in the later part of the marketing year.

Continue to expect prices to be relatively quiet for the remainder of the week as traders await fresh news from USDA on Friday. Want live quotes for this Friday's USDA World Agricultural Supply and Demand report? Take a no-obligation 14 day trial of our trading software today!

grain hedge topper

 

Soybeans Test $15/bu. as Corn/Wheat Hold Ground

Nov 05, 2012

Dryer conditions in Argentina and much needed moisture in the Mato Grosso region of Brazil both helped push corn and soybeans lower in today's action. On this afternoon's GrainTV Brock and Logan discuss South American production, US crop progress, and this morning's Export Inspections report. Want live quotes for this Friday's USDA World Agricultural Supply and Demand report? Take a no-obligation 14 day trial of our trading software today!

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

Diagnosis Bias –Still Bullish in the Face of Bearish News?

Nov 04, 2012

I was trained as an economist, and the principle tenant of economics is that people, businesses or any other economic actors are "rational". People are expected to interpret, synthesize and act upon new information in a wholly unbiased and rational manner.  

But, there is growing evidence that this may not be the case. Just look at various "bubble scenarios" that have transpired in the past 20 years from internet stocks in the late 1990s to the housing market in 2008.  Were those of us that bought internet stocks at outrageous Price-Earnings ratios rational? Or were people rational that plowed investment dollars into housing markets as US incomes and the economy were weakening?

As humans, we all suffer from what psychologists have termed "diagnosis bias".  It’s not a disease. It’s not a psychological abnormality that impacts the mentally ill. Instead, it is what all are prone to in the face of decision making.  We have a propensity to label people, ideas or things based on our initial opinions of them and, even more detrimental, we tend to ignore future evidence that contradicts our initial judgment.

When it comes to marketing or trading, I bet we can all point to instances when we’ve fallen prey to diagnosis bias.  You were bullish but the market continued to trade in a very ‘non-bullish’ fashion. Perhaps you favorite indicators were suggesting weakness, but you shrugged it off as being part of the pitfalls of technicals, they can be wrong at times.  Maybe the news started to "disappoint" in terms of not meeting analysts’ estimates but yet again you could discount this information as being temporary and not disruptive to your long-term bullish sentiment.

But, the problem you run into is not adequately recognizing the cues that are right in front of you. After all, diagnosis bias can cause any of us to easily dismiss views that differ from our own firmly entrenched stance.  Is diagnosis bias preventing you from making the best marketing decisions for your operation?

While I don’t pretend to know whether this bull run in grains is over, there are certainly signs that it might be time to re-evaluate your position if you’ve been on the long side of this rally. Here are some key things I think make you question a strongly bullish perspective:

grain hedge topper

      --Ethanol production has been the darling of the corn sector. But there may be a chink in the ethanol armor. Ethanol prices are not trading at levels necessary to make most plants profitable. Ethanol margins have taken a big hit as of late and even corn prices at mid $7 aren’t helping ethanol producers. USDA has slashed their forecast for 2012-13 ethanol by 10%, but two months into the marketing year we are seeing production cutbacks more on par with 12%.

            --Both Brazil and Argentina are expected to produce a massive crop and rainfall in the region seems plentiful putting the likelihood of a big drought in question. Yes, U.S. soybean exports are white-hot right now, but the longer we see better crop prospects coming in 5 months from South America, the quicker our exports will dry up.

            --On exports, it is hard to ignore just how dismal U.S corn business has been abroad. Year-to-date, our export inspections for corn are off 37% from last year while USDA projects only a 25% drop.  

This year’s drought is behind us and now the market will turn its attention to the rest of the world and demand side factors. While it is possible to have any number of scenarios change that would give us more of a bullish lift in the coming months, the news and data is not favoring higher prices. Don’t let diagnosis bias cause you to lose sight of changing market conditions.

 

 

 

Export Demand, How Does It Affect River Basis?

Nov 02, 2012

grain hedge topper

Weekly exports sales exceeded expectations for soybeans and met expectations for wheat and corn.  This has been the pattern for much of the marketing year.  Export demand has been running ahead of pace to meet current USDA projections for soybeans, but corn fell behind this week for the first time this marketing year.  The question to ask is: How is export demand affecting river basis levels? To get the answer and a recap of today's and this week's price action, tune into GrainTV.

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

EIA Numbers Show Strong Week for Ethanol, DEC Corn Closes Down 5 3/4

Nov 01, 2012

EIA Ethanol numbers made a strong showing this morning but corn futures continued to slip lower. Our model currently shows us 100 million bu. behind pace to meet USDA expectations for Ethanol production, but there are important implications for corn feed use based on these ethanol numbers. Brock and Logan discuss these issues and harvest progress on this morning's GrainTV.

grain hedge topper

THERE IS A SIGNIFICANT RISK OF LOSS IN TRADING FUTURES AND OPTIONS.
FUTURES TRADING IS NOT APPROPRIATE FOR ALL INVESTORS.
PLEASE READ OUR RISK DISCLOSURE.

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