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January 23, 2017 | Kevin McNew | Views: 280
January 23, 2017 | Grain Hedge Insights | Kevin McNew | Views: 205

Soybeans Start the Week Heading Lower

US Dollar Feels Pressure for First Week of Trump's Presidency

Soybeans started the week the same way they finished last week, heading lower. Corn and wheat were also under modest pressure. In outside markets, US equities and the dollar moved south as did crude oil.

 

Soybeans slid for a third straight session on Monday as forecasts of dry weather in Argentina's flooded crop areas eased concerns over harvest losses in the major exporter. The weather there over the next week is expected to be hot and dry, helping ease flooding issues. Last week, the Rosario grains exchange cut its forecast for the 2016/17 Argentine soybean crop to 52.9 MMT from 54.4 MMT previously. In Brazil, heavy rains have slowed soybean harvest and could put at risk some production from spoilage. Farmers institute, Imea, said the soy harvest in Mato Grosso was 11.9% complete on Friday, an advance of more than 6% over the past week.

 

A group of Israeli private buyers has issued international tenders to purchase up to 85,000 tonnes of corn and 40,000 tonnes of feed wheat. Egypt’s GASC bought 60,000 MT of Ukraine wheat. Offers came from Russia, Ukraine and Romania. SovEcon said in a note that Russia needs to find new markets for its grain exports and speed up its supplies abroad to ease pressure on the domestic market after a record crop of 119 MMT in 2016. Customs data shows Russia's December grain exports fell to 3.18 million tonnes from 4.05 million tonnes in November due to storms in ports and the rouble strengthening against the dollar.

The US Dollar felt some pressure for the first week of Trump’s presidency as traders expect his tax & fiscal stimulus policies to take time to enact and have yet to be spelled out by the new President. Also, a bow shot about American nationalism in his inauguration speech has the potential to cut into global trade.


 

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

January 20, 2017 | Grain Hedge Insights | Kevin McNew | Views: 179

Chicago Soybeans Slid for a Second Session

US Dollar Recouped Losses on Friday

Chicago soybeans slid for a second session on Friday with a strong dollar weighing on prices, although crop-damaging floods in Argentina kept a floor under the market. The dollar recouped earlier losses on Friday while stocks were little changed as investors refrained from big bets ahead of Trump’s inauguration as US President.

 

Soybeans are drawing support from the threat of rain-damage to crops in Argentina, the world’s third largest soybean exporter and the top supplier of soymeal and soyoil. Argentina will harvest 52.9 MT of soy this season, the Rosario grains exchange said on Thursday, cutting its previous 54.4 MT forecast due to bad weather.

 

US producers are poised to plant 90.52 million acres of soybeans later this year, topping the all-time high set in 2016 by about 7 million acres, a recent Farm Futures survey indicates.

 

Wheat fell for a third consecutive session on concerns over slowing demand after prices earlier this week climbed to their highest since August.

 

Weekly Export Sales-

(based on reports from exporters for the period Jan 6-12, 2017)

 

                                            Actual      Expected

Corn                                     1,368      900-1,200

Soybeans                                 980         400-600

Wheat                                     243         250-450

 

Export sales numbers for corn were up noticeably from the previous week and 69 percent from the prior 4-week average; soybeans were also up from the previous week and 22 percent from the prior 4-week average. Wheat was down 38 percent from the previous week and 33 percent down from the prior 4-week average.

 

The dollar held its gains on Friday as investors braced for US President-elect Donald Trump to be sworn in, while the Euro rebounded as the European Central Bank held policy steady. A stronger dollar makes US agricultural producers uncompetitive in the world market, giving advantage to rival exporters in South America and the Black Sea region.

 

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

January 19, 2017 | Grain Hedge Insights | Kevin McNew | Views: 241

Beans Take a Break from 4 Day Rally

Wheat Posts Modest Losses

Beans Take a Break from 4 Day Rally

Beans took a break from its 4 day rally giving up 6 cents in the overnight. Wheat was also posting modest losses going into the break while corn was fractionally lower.

 

Soybeans eased on Thursday as prices consolidated from a six-month high a day earlier that was driven by the threat of rain damage to crops in major exporter Argentina. But with drier weather forecast in Argentina this week and neighboring Brazil already harvesting what is expected to be a record crop, investors were reassessing the impact on international supply.

 

Consultancy, Strategie Grains lowered its forecast for the 2017 soft wheat harvest in the European Union by 1.2 million tonnes to 143.8 million as it factored in expected damage to crops in the eastern EU due to severe cold weather this month. The reduced forecast would be 6 percent above estimated production of 135.9 million tonnes last year, when output was curbed by a very poor harvest in top EU wheat grower France, Strategie Grains said in a monthly report.

 

The International Grains Council raised its forecast for the 2016/17 world corn crop on Thursday by 3 million tonnes to a record 1.045 billion tonnes, mainly reflecting an improved outlook for China.  The IGC raised its outlook for world wheat production in 2016/17 by 3 million tonnes to 752 million tonnes.

South Korea's state-run Korea Agro-Fisheries & Food Trade Corp. has purchased 140,000 tonnes of soybeans to be sourced from the United States in an international tender which closed on Thursday.

 

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

January 18, 2017 | Kevin McNew | Views: 216
January 18, 2017 | Grain Hedge Insights | Kevin McNew | Views: 257

Beans Post Small Loss Overnight

Crude Oil Was Seeing Big Losses

Beans posted a small loss overnight taking a break from its 3-day rally of over 60 cents a bushel. Corn and wheat were little changed heading into the morning break. In outside markets, crude oil was seeing big losses while the US dollar and equity futures were in positive territory.

 

Conditions will trend much drier for much of central and northern Argentina over the next 7 to 10 days. Some of the wettest locations from Cordoba east through Entre Rios will have plenty of opportunity to dry out. This will lead to improvements in crop conditions. Meanwhile, Brazil continues to have good conditions for crop development.

 

On Tuesday, NOPA released their crush estimate for member plants in December. Their report showed 160.2 MB of soybeans were crushed in December, falling well short of the 162.8 MB that had been expected. Stocks of soybean oil also ballooned to 1.434 billion pounds, above trade estimates of only 1.352.

 

In wheat news, Minneapolis wheat was sharply lower on Tuesday easing the white-hot spread to KC & Chi on heavy farmer sales. Overnight the Philippines bought feed wheat from Australia. Indonesia may see limited needs for importing wheat and corn feed grains as production there is up sharply on the year. Indonesia imported 2 MMT of feed wheat last year and 840,000 tonnes of corn.



 

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

January 17, 2017 | Kevin McNew | Views: 315
January 17, 2017 | Grain Hedge Insights | Kevin McNew | Views: 288

Beans Come Back from 3 Day Weekend Trading Higher

Crude Oil Posted Solid Gains

Beans Come Back from 3 Day Weekend Trading Higher

Beans came back from the 3-day weekend trading sharply higher which helped bring corn and wheat along. In outside markets, the US dollar and equities traded sharply lower while crude oil posted solid gains.

 

USDA reported a 102,944 MT sale of corn to unknown destinations

 

Weather over the weekend was a driving catalyst for soybeans as 3 to 5 inches of rain fell in water-soaked areas of Argentina. Flooding resulted in parts of the region resulting in a new risk to some crop areas that either were still flooded from previous heavy rains or just recently experienced improving conditions. Most likely flooding occurred in areas that flooded earlier this summer and new damage to crops may be somewhat limited.

 

In negative developments, China is said to have cancelled 7 cargos of US ethanol as tariffs start to take effect.  The tariff is expected to rise to 30% from its current level of 5%, essentially imposing a blockade on US shipments.

 

In export news, Japan was in the market for 117,605 MT of milling wheat with the results expected Thursday. The Philippines were also trying to source 165,000 MT of feed wheat.

 

The US dollar hit its lowest mark in a month as British Prime Minister May promised a parliamentary vote on Britain's deal to leave the European Union and stressed it would seek to stay a key European partner. This bolstered the Sterling giving it the biggest jump since the June Brexit vote.



 

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

January 13, 2017 | Kevin McNew | Views: 179
January 13, 2017 | Grain Hedge Insights | Kevin McNew | Views: 133

Weekly Cash Comments

Weekly Cash Commentary for week ending 01/13/2017

Basis levels were mostly unchanged for corn across the US this past week, while soybean basis nudged lower on the late week strength in futures.

 

Basis levels at river terminals had the most weakness as a slowing bean export program has started to deflate basis levels. For the week, soy basis at river terminals dipped nearly 3 cents with key terminals along the IL River off 5 to 7 cents. For corn, there were some modest gains of 1 to 2 cents along the MS River terminals but IL River terminals were mostly 3 to 5 lower.

 

For end users, corn plants were mostly steady on the week with notable movement while soy crushing facilities were slightly weaker.

 

With soy futures leaping higher at the end of the week basis levels for beans may come under more pressure from active farmer sales. However, corn stocks held by farmers continue to be record large which will keep corn basis on the defensive as well between now and spring.

 

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

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