August 06, 2015 | Cody Bills | Views: 234
August 06, 2015 | Grain Hedge Insights | Cody Bills | Views: 152

Strong Wheat Sales Lift the Grain

Strong wheat sales helped provide support for the grain, but significant cancellations is putting pressure on soybeans which bumped against the 100 day moving average yesterday.

In the overnight session the grains were mixed with corn up 1/2 cent, soybeans down 6 cents and wheat up 6 1/4 cents this morning. The U.S dollar is higher by only a fraction of a percent and crude oil is down 53 cents this morning. This morning exporters sold 132,000 metric tons of soybeans to China for 15/16 delivery.


Export sales this morning were dramatic with soybeans reporting old crop sales cancellations of 447,300 metric tons which missed expectation which ranged from 0-200,000 metric tons. Soybean sales are still ahead of pace to meet current USDA expectations, but this week’s sales erased all of last week’s sales of 416,700 metric tons. New crop soybeans outperformed this week booking 1,024,200 metric tons which was above last week and above expectations which only ranged between 350,000 and 700,000 MT. Corn sales were also ugly with only 2,700 metric tons this week was a marketing year low for the grain. Expectations ranged from 250,000 to 450,000 metric tons. New crop corn sales missed expectations, only booking 277,000 metric tons. Wheat recorded a marketing year high in export sales this week which is helping to lift the grain in this morning’s session. Wheat booked 838,500 metric tons this week which was well above the 400,000-600,000 MT range of estimates.


Ethanol production declined 4,000 barrels per day this week to 961,000 barrels per day. This is over 100,000 barrels per day over the four year average and 59,000 barrels per day over last year’s production for the same time period. Ethanol stocks declined 409,000 barrels per day to 19.24 million barrels this week. 

August 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 192
August 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 151

Soybeans to test 100 day moving average

Soybeans printed a bullish price pattern in the last two trade sessions. Can it break through overhead resistance at the 100 day moving average?

In the overnight session the grains were mixed with corn up 1 cent, soybeans up 9 3/4 cents and wheat down 1/2 a penny. The U.S. dollar is trading a fraction of a percent lower and crude oil is higher by 73 cents. This morning the ADP jobs data showed that 185,000 workers were added to payrolls in July which was below expectations which ranged from 190,000 to 263,000. Egypt announced a tender for 55-60,000 metric tons of wheat from either the US, Ukraine, Russia or Australia. The U.S. is not expected to win the tender due a stronger U.S dollar and higher prices here in the U.S. Korea also issued a tender for purchase of up to 207,000 metric tons of yellow corn to be sourced from optional origins this morning.


Last night at 3:30 PM CST FC Stone announced their first 2015 corn and soybean production forecast which was below current USDA forecasts. FC Stone’s corn production estimate was 149 million bushels shy of the USDA with 13.381 billion bushels. They see corn yield at 165 bushels per acre compared to a current USDA forecast of 166.8 BPA. Soybean production was also below current USDA estimates with 3.797 billion bushels forecast for the 15/16 marketing year. Soybean yield was forecast at 45 bushels per acre compared to a current USDA forecast of 46 BPA. This morning China’s agriculture ministry proposed to lower corn prices to help support margins for domestic hog producers and lower the prices of pork.  


The weather forecast looks to bring some excitement into the market for soybeans as chances of rain in the 6-15 day forecast provide low confidence that extensive showers will relieve the dry spots in northeast Iowa, northern Illinois and southern Wisconsin. Only 54 percent of the soybean crop has set pods making the short rooted crop more vulnerable to dryness in the coming weeks. ​

August 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 196
August 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 165

Conditions Improve for Soybeans

The crop conditions report showed soybean ratings improved over last week.

In the overnight session the grains traded higher with corn up 3 1/4 cents, soybeans up 10 1/2 cents and wheat up 3 3/4 cents. The U.S. dollar is down .20 percent this morning with crude oil up 88 cents. Corn and soybeans seemed to find some buying support during yesterday’s session with both grains closing the day in the top half of the day’s trading range. Soybeans had the most dramatic price bar of the day, printing a doji near support indicating a possible change in trend.


Crop conditions were in line with analyst expectations with corn good-to-excellent ratings unchanged on the week at 70 percent. Weather continues to look promising this week with above average precipitation, and cooler than normal temperatures expected across the majority of the grain belt. These conditions will be critical for the soybean development as only 54 percent of the crop is setting pods. Soybean conditions improved this week by 1 percentage point to 63 percent rated good-to-excellent.  


There are a two yield related items to pay attention to over the next couple days including the first FC Stone yield estimate for the 2015 corn and soybean crop. FC Stone will be releasing their estimate at 3:30 PM CST today. Informa will also be releasing their monthly crop production estimates on Wednesday.


Export inspections disappointed for wheat on Monday with only 298 thousand metric tons inspected for export, down from 439 thousand metric tons last week and below the range of expectations. Soybeans and corn inspections met expectations with 148 thousand metric tons and 920 thousand metric tons respectively. However, corn’s inspections did decline from last week’s levels of 1.1 million metric tons. 

August 03, 2015 | Grain Hedge Insights | Cody Bills | Views: 166
August 03, 2015 | Grain Hedge Insights | Cody Bills | Views: 162

Soybean Prices Dip Again

Soybean prices fell again on Monday as ideal weather is mostly positive for early august during a critical development period.

In the overnight session the grains traded lower with corn down 5 1/4 cents, soybeans down 8 3/4 cents and wheat down 5 1/4 cents. The U.S. dollar is trading .21 percent higher and crude oil is down nearly a dollar on news that China’s factory activity contracted the most in two years.


The weather forecast continues to look positive for corn and soybeans across the Midwest with cooler than normal conditions expected this week. Rains should be widespread this week covering the eastern grain belt this evening and moving west later this week. The market will be watching the latest crop progress report scheduled for release at 3 PM CST with expectations for mostly unchanged to slightly higher crop conditions.


The latest Planalytics corn yield forecast released on July 31st increased its yield forecast by 1.3 bushels per acre to 166.7 bushels per acre as ideal weather over the past couple weeks helped corn through a critical reproductive phase. Planalytics left soybean yield unchanged at 45.6 bushels per acre with august weather still unknown. August weather will be critical as soybeans continue its pod setting stage and so far weather is positive. Current USDA yield estimates are 46 bushels per acre for soybeans and 166.8 bushels per acre for corn.


This morning Ukraine announced it expects to increase grain exports to 36 million metric tons this marketing year from 34.9 million metric tons in the 14/15 marketing year. In Ukraine, the export pace in July increased 13 percent over last year to 2.5 million metric tons. 

July 31, 2015 | Grain Hedge Insights | Cody Bills | Views: 212
July 31, 2015 | Grain Hedge Insights | Cody Bills | Views: 220

Weekly Cash Comments

Cash Commentary for week ending 31 July 2015

Cash grain basis was mixed this week with corn basis up 2 cents a bushel, while soybean basis was off 2 cents a bushel.


In corn, basis levels were mostly firmer in Iowa and Nebraska as ethanol plants have bid higher in an interest to get more farmer grain after the recent sell off. In addition, buyers in Indiana and Ohio posted higher basis as futures prices declined and poor new-crop prospects limited farmer movement of old crop supplies.


For beans, a bidding war was brewing in Indiana as major soy crushing plants moved up sharply to attract spot supplies. River terminals also found strength this week as late season export business continues to be unusually brisk for this time of year.

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