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April 25, 2016 | Grain Hedge Insights | Kevin McNew | Views: 232
April 25, 2016 | Grain Hedge Insights | Kevin McNew | Views: 241

Soybeans with the Biggest Loss in the Overnight

In the US, rains were prominent in IA, MN & ND over the weekend bring an inch or more of precip

Grains were lower overnight with soybeans taking the biggest loss. In outside markets, crude oil and equity futures were also lower in overnight trade.

 

After Friday’s meltdown in the soybean market, prices on front-month May futures seemed to find support at $9.80 before the regular session open. However, news that fueled the rally over the past month seems to be waning in importance. Argentina’s weather woes look to be in the rearview mirror. Bean harvest was picking up in SW Argentina and receipts at port terminals are gaining to almost normal harvest levels. Weekend rainfall was spotty in Argentina with a few areas seeing a 0.50 inch, but most key areas were dry over the last 3 days.

 

In the US, rains were prominent in IA, MN & ND over the weekend bring an inch or more of precip, while the Southeast also saw large rain events.Rain looks to be prominent in the 7-day forecast with accumulations heaviest from IA to TX, and potentially excessive at times.

 

USDA will release planting progress today after the market closes. Average corn plantings on this date are around 25% and good weather last week may lead to a big jump in plantings to over 30%. Also, look for winter wheat conditions to improve on improved moisture in the Plains. Some producers in HRW country are talking yields 10% above last year.

 

Crude prices fell overnight following a report saying Saudi Arabia could maintain its total production capacity with the expansion of an oilfield, fueling fresh concerns about the global supply glut. Saudi Arabian Oil Co will complete an expansion of its Shaybah oilfield by the end of May, allowing the world's largest exporter to maintain total capacity at 12 million barrels a day, Bloomberg News reported. The expansion will see Shaybah's capacity rise from 750,000 barrels to 1 million barrels a day, the report said.

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

April 22, 2016 | Grain Hedge Insights | Kevin McNew | Views: 216
April 22, 2016 | Grain Hedge Insights | Kevin McNew | Views: 202

Grains Head Lower in the Overnight

Markets seemed poised to turn to the reality of the fundamentals.

Grains head lower overnight with soybeans taking the biggest hit giving up 20 cents. In outside markets, crude oil recovered from yesterday’s losses while equity futures had a slightly weaker tone in the night session.

 

Markets seemed poised to turn to the reality of the fundamentals. Overnight, Goldman Sachs stated to clients “While this recent rally has the potential to run further to the upside ... we believe that it is not yet driven by a sustainable shift in fundamentals.” Yesterday, the Buenos Aires Grains Exchange dropped its 2015-16 soybean crop estimate to 56 million tonnes from its previous 60-million-tonne forecast. Minutes later the agriculture ministry marked its estimate down to 57.6 million tonnes from 60.9 million tonnes. Some analysts have been talking about a 15 MMT loss in Argentina but the reality could be something substantially smaller like 5 MMT.

 

Corn and wheat made bearish key reversals on the charts yesterday which could cause selling pressure to intensify. Brazil corn sees showers expand into the southwest 2/3 of the belt early next week to ease stress. Showers remain limited in the northeast 1/3, leading to ongoing stress into early May. Rains in the far south stall soy harvest, but the 6 to 10 day turns drier. In Argentina, rains (.25 to 1”, locally 2”) were confined to northeast fringes of the corn/soy yesterday. Light weekend showers (.25 to .75”, locally 1.5”) cross the belt. Drier conditions then settle in for much of the next 10 days. Harvest should improve in the southwest 2/3 of the belt, while recovery in the northeast 1/3 will still be very slow.

 

NOTE: CME Margin Rates for soybeans have increased from $1,500 to $1,750 per contract on hedge accounts

 

In outside markets, crude oil was moving higher and seemed poised to make a run at the near-term high of $44.45 a barrel. Later today the Baker Hughes rig count will be out and will likely show a continued decline in active US rigs.

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

April 21, 2016 | Grain Hedge Insights | Kevin McNew | Views: 226

Weekly Export Sales Numbers

Wheat has Blown thru Some Key Levels

The wet conditions continue to hamper operations in NE Arg but dries in the
SW part of the country with some harvest resuming next week. As the storm system moves north, it is expected to give some relief to the drier areas of the southern Brazil safrina crop. 
 

Short covering in wheat hit day 3 hard yesterday with total gains approaching 50-cents over that 3-day period. With wheat, you have to ask whether we really need this big a rally in the face of burdensome supplies, lackluster export demand and better than normal crop conditions in US winter wheat. It's difficult to pick a top, but in the case of wheat we have blown thru some key levels and made our export deals even less competitive in the world's eyes.

 

WEEKLY EXPORT SALES

                  OC-Act         OC-Exp       NC-Act      NC-Exp

Corn           1202.8       900-1,200       123.1     100-200

Soybeans     407.7           100-200       339.7     200-500

Wheat         295.1              0-300        325.6    100-250

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

April 20, 2016 | Grain Hedge Insights | Kevin McNew | Views: 244
April 20, 2016 | Grain Hedge Insights | Kevin McNew | Views: 218

Soybeans Weak in the Overnight Session

In crude oil, prices were off about $0.80 a barrel overnight

Soybeans were weaker overnight following yesterday’s 30-cent advance while wheat and corn held onto modest gains.

 

Overnight, new-crop November soybeans took a run at the milestone $10 mark, but fell short hitting an intra-day high of $9.99 before returning to the low $9.90 mark. Funds were heavy buyers on Tuesday, buying 25,000 contracts.

 

This morning’s weather forecast suggests Argentina’s corn and soybean harvest could resume in much of the country next week after being plagued by flooding which put harvest at a standstill and potentially damaged crops there. In Brazil, stress to the 2nd season corn crop in the South may be eased as wet weather and cooler temps are expected early next week.

 

In crude oil, prices were off about $0.80 a barrel overnight after yesterdays API crude stocks number came in higher than expected. Average expectations were for a 1.6 million barrel build, but came in at a 3.1 million barrel build. Also pressuring crude, Kuwait oil workers called off a three-day strike, a key support that kept oil prices afloat after major global producers failed to agree to a production freeze last weekend.

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

April 19, 2016 | Grain Hedge Insights | Kevin McNew | Views: 300
April 19, 2016 | Grain Hedge Insights | Kevin McNew | Views: 148

Corn and Soybeans Higher Overnight

Crude Oil continues to find support

Corn and soybeans were higher overnight while wheat gave up some of yesterday’s impressive gains. In outside markets, crude oil continued to find support from a Kuwait oil strike while silver reached its highest mark in a year.

 

After the close Monday, USDA’s crop progress report showed 13% of the corn crop planted versus 4% last week and an expectation of 14%. Wheat condition was also up following beneficial rains in HRW wheat country. The percent of the crop rated good-to-excellent inched higher to 57% versus 56% last week.

 

Weather over the next few weeks continues to favor crop planting. Patchy showers linger in the central Midwest today, scattering into the southwest again tonight/tomorrow and shifting through the Delta/eastern Midwest by Thursday. The heaviest totals occur in the Lower Mississippi Valley, and only minor interruptions are expected to Midwest seeding. Showers scatter into the northern/eastern Midwest again by Sunday/Monday, but broader Midwest/Delta coverage occurs at the middle of next week and again early the following week. While the more active pattern will hinder corn seeding, risks of excessive rain are limited, and fieldwork still occurs in between rain events.

 

In South American weather, the latest model runs show wetter Argentina weather in the coming week although there is no agreement from various models. But, if realized, there would be some additional harvest delays across key summer crop areas. The second week outlook is still looking better for most of Argentina.  In Brazil, there is some potential rain for center west, center south and northeastern Brazil next week.

 

In crude oil, prices continued to be supported from a Kuwait oil workers strike, now in its third day. However, analysts said Kuwait's disruption would likely be brief and investors would soon refocus on the market's oversupply given the failure of major exporters on Sunday to agree to freeze output to avoid worsening the glut.

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

April 18, 2016 | Grain Hedge Insights | Kevin McNew | Views: 188

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