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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 Weekly Grain Wrap-Up 6/12/09

Jun 12, 2009
Weekly Grain Wrap-Up
 
SETTLEMENTS 6/12
         
 
July 09 Corn
425 ½
- 15 ½
Dec 09 Corn
447 ¾
- 15 ½
July 09 Beans
1245 ½
- 21 ½
Nov 09 Beans
1076 ½
- 13 ¼
July 09 Wheat
584 ¾
- 10
July 09 KC Wheat
637
- 7 ½
July 09 Min Wheat
732 ½
- 1 ½
July 09 Meal
422.7
- 5.3
July 09 Oil
37.16
- 1.04
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 
Corn closed 15 cents lower on the day and 19 cents lower on the week. Concerns over planting delays, a weak U.S. dollar and investment money entering the commodities all helped push corn to the highest levels since last November. After a bullish report on Wednesday, the corn market started to take in profits. With the crop being planted, the market started to focus on the struggling animal sector. Heavy liquidation in the hog industry and an expected sharp drop in feedlot placements for cattle are weighing on the corn market. A weak dollar and the possibility of losing additional acres on the June 30th report is keeping the market supported. This is typically a very difficult time of year for the grain markets to rally. Once the corn starts growing and looking green, the market will want to sell off. This could make corn vulnerable for another round of selling next week. As we approach the end of the month, I still expect corn to find some more buying interest. If we lose too many acres, corn will be very sensitive to any hints of bad weather around pollination. On the other hand, if acres are unchanged on the report, the corn market will have a difficult time at these levels. The wheat market is selling off sharply as we head into harvest.  Large supplies of wheat should cause cash wheat prices to break in order to gain feed demand. With a struggling feeding sector, we could see low-quality wheat trade at a discount to corn. This could further pressure corn prices if the report is a “non-event.” Overall, I still think…
 
Old crop soybeans closed 21 cents lower on the day and 25 cents higher on the week. New crop soybeans closed 13 cents lower on the day and 15 cents higher on the week. Tight old crop soybeans and a strong old crop soybean meal market lead the soy complex higher once again this week. After a bullish report, soybeans made new highs for the move led by old crop soybean meal. After trading nearly limit up yesterday, soybean meal and old crop soybeans sold off sharply. Old crop supplies will likely remain tight for the remainder of the summer, but new crop soybeans could start to separate from them. Once the funds finish “rolling” from old crop to new crop, we should see the new crop soybeans act on their own accord. The June 30th report will determine where the soybeans need to head from here. We will see what old crop stocks are as well as new crop acres. The potential for a large increase in acres could pressure the soybean market over the next two weeks. Global production is expected to rise next year, raising ending stocks by an estimated 23%. This is with high demand estimates and without an increase in U.S. acres. Obviously, things can change, but this is something that shouldn’t just be ignored. As a producer, I would …
 
Wheat remains under pressure as we head into harvest. Wheat closed 10 cents lower on the day and 39 cents lower on the week. A bearish report on Wednesday helped wheat continue its break ahead of harvest. Demand remains weak for wheat and global and U.S. supplies look to remain large. Weather looks good for wheat in all areas except Argentina. If new money continues to flow into commodities, we should continue to see 15-cent to 30-cent wheat rallies. These should be viewed as selling opportunities as we head into harvest. After harvest, we will need to see how -- or if -- demand picks up and what corn and soybean prices do. You should…
 
 
 
 
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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 (1 Comments)

Anonymous
Do I really care if the dow is down, or if the energies are up or down, the fact of the matter is we are almost out of soybeans. I think on old crop soybeans we can start to decouple from these influences. All winter it was exports, we were worried about economies having enough money to buy, well we are about to set a record export. If cash prices cant come along for the ride its almost embarrassing from a producer standpoint. Lower carry-outs but run up futures and keep cash under control. What bettr way to acquire remaining old crop bans cheap.
12:29 AM Jun 13th
 

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