March 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 160

Strong Dollar Pressuring Wheat?

U.S. Wheat struggles to remain competitive in the global market. Cody discusses what this means moving forward and gives a brief on the current export sales pace for corn and soybean.

March 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 127

Export sales see weekly improvement

Export sales came in within analyst expectations. However, soybean sales continue to be well ahead of pace to meet the USDA expectations. Will the USDA revise export sales estimates in the March 10th WASDE report?

In the overnight session the grains are mixed with corn up ¼ of a cent, soybeans are up 3 ½ cents and wheat is trading down ¾ of a cent. This morning it was announced that 108,000 metric tons of sorghum was sold to unknown destinations for 15/16 marketing year. The US dollar index is slightly higher in the overnight as well as the Euro fell to its lowest level in nearly 11 years. Traders are watching the European Central Bank for an announcement on details of its bond buying program.


The Thursday morning export sales report showed corn, soybeans and wheat all improved bookings over last week. Corn booked 828,100 metric tons this week which was up 16 percent from last week and within analyst expectations. Soybeans booked 499,500 metric tons of sales this week increasing 9 percent from the previous week. Soybean expectations ranged from 300,000-500,000 metric tons. Wheat sales increased 43 percent over last week, booking 469,600 metric tons compared to expectations which ranged from 350,000-550,000 metric tons.


Ethanol production dropped again this week, declining 16,000 barrels per day to 931,000 barrels per day. Despite the decline in production we are still well ahead of the pace of production seen last year. Ethanol stocks declined as well, falling 66,000 barrels to 21.53 million barrels. Traders will be watching the next WASDE report on March 10th to see if the USDA will increase their corn used for ethanol line item to reflect the strong pace we have seen in the first half of the marketing year.


China’s finance Ministry stated that it will increase spending by 33 percent year over year on stockpiling grains, edible oils and other materials in 2015. The finance ministry is expecting to spend 154.6 billion yuan which is equivalent to 24.66 billion U.S. Dollars.      

March 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 188

Soybeans Lose Traction

Tune in for a report on the U.S. Dollar, Brazilian Real, and a discussion of what drove soybeans lower.

March 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 138

Grains Pressured by Higher Dollar

The grains are getting pressured this morning by a stronger dollar which is testing new highs.

In the overnight session the grains moved lower with corn down 1 ½ cents, soybeans down 8 ¼ cents and wheat down 5 ½ cents. Minneapolis wheat is down 4 ½ this morning after a 15 cent gain in yesterday’s session. The cash market is firming for spring wheat in Portland which saw basis rise 20 cents yesterday. Spot basis is now at +293 off the May contract which is well above the three year average basis of +201.   


The U.S. Dollar index is pushing higher this morning, closing in on the 95.85 level it traded at back on January 26th. If it closes above that level it is likely that the dollar will resume its upward trend and start another leg higher. Strength in the U.S. dollar is a main reason why U.S. wheat exports have been noncompetitive on the global market.


The Brazilian trucker strike has calmed substantially from last week when over 100 roadblocks were scattered throughout the country.  However, the situation has not resolved itself completely. On Tuesday there were 18 roadblocks that remained and although a key highway to Mato Grosso has been opened up, roadblocks still remain for grain headed for the port of Paranagua.


Yesterday, Argentina grain farmers announced they will suspend grain sales for three days in protest of government policies such as export quotas. Traders see this as a political move to help bring agriculture to the front of attention during this year’s elections. There are no concerns yet that exports will be interrupted, but it will be important to pay attention to any further developments of this strike.  

March 03, 2015 | Grain Hedge Insights | Cody Bills | Views: 229
March 03, 2015 | Grain Hedge Insights | Cody Bills | Views: 111

Grains Mixed After Monday Selling

The grains are mixed after Monday selling with Informa's latest crop report expected out at 10:30 AM this morning.

The grains are mixed this morning with corn up 1 ¼ cents, soybeans down 3 ¾ cents and wheat in Chicago down 2 ½ cents. Traders should keep an eye on the Informa Economics latest crop estimates scheduled for release at 10:30 AM this morning. Also on the horizon is the USDA Supply and Demand report to be released on the 10th and the NOPA crush figures on the 16th.


Yesterday, export inspections showed that corn beat analyst expectations by recording 1.2 million metric tons inspected for export compared to expectations which ranged from 750,000 and 900,000 MT. Wheat reported 450,093 metric tons inspected for export which was on the high side of analyst expectations and soybeans recorded 635,164 MT which disappointed analysts who were expecting between 750,000 and 950,000 MT.


A recent crop condition report on Monday showed that the western HRW regions of Oklahoma, Nebraska, Texas and Colorado have improved their crop conditions ratings due to less than expected winterkill during February. However, Kansas wheat conditions have slipped due to harsh conditions and freezing temperatures throughout February. 

March 02, 2015 | Cody Bills | Views: 186
March 02, 2015 | Grain Hedge Insights | Cody Bills | Views: 274

Police Crack Down on Brazil Roadblocks

The police handed out fines and cleared out a number of roadblocks helping restore traffic flow to congested areas of the country.

In the overnight session the grains traded mixed with corn down 1 cent, soybeans up 2 ¼ cents and wheat up 2 cents going into the morning pause in trade. The Chicago wheat market seems to have held support off $4.96 last Thursday which was the previous low back on February 2nd.


Over the weekend the Brazil police enforced the fines announced by the justice minister on Friday. The Police arrested protesters and broke up road blocks bringing the total number of road blockages down from 88 on Thursday to 12 partial roadblocks nationwide. Protest leaders stated that the government has still not addressed the striker’s issues. The Brazilian government will increase the police presence on the highways to ensure freight lanes are kept open.


The Midwest is expecting to receive more wintery weather this week with below zero temperatures expected by the end of the week and between two to eight inches of snow is expected in the northern Delta. Due to the accumulated snow cover, there is a low concern for winterkill freezing areas.  

February 27, 2015 | Cody Bills | Views: 162

Weekly Wrap Up

Cody and Kevin talk weekly basis and give an update on the trucker strikes in South America.

February 27, 2015 | Grain Hedge Insights | Cody Bills | Views: 178

Weekly Cash Comments

Cash Commentary for week of February 27th

Corn basis saw modest growth this week advancing 2 cents a bushel on average across the country, but bean basis was unchanged thanks to higher futures and better farmer selling.


In corn, basis levels were up largely driven by strength at ethanol plants in the Western Cornbelt. On average, ethanol plants posted a 3-cent gains but in the Western Cornbelt plants were up 5 to 10 cents a bushel in some cases. This week’s ethanol production was off 17,000 barrels per day from the previous week, but year-to-date production is still well ahead of last year’s pace. At the Gulf, export basis gained 2 cents a bushel but river terminals on average were up slightly less than that. Southern stretches of the Mississippi river and the Ohio River saw corn basis strength this week.


For beans, average basis levels were flat across the country, but soy crushing plants as a group were off 2 cents a bushel. Deliveries appeared to pick up this week with soybean futures shooting higher early in the week thanks to the threat of a Brazilian trucker strike. Also, bad weather in the US eastern Cornbelt kept plants in Indiana and Ohio bidding higher for beans as farm movement slowed, while river terminals along the Ohio River encouraged farmers to deliver beans over corn to their facilities. On average, river terminal basis levels were unchanged for the week in spite of a 4-cent advance at the Gulf.

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Weekly Cash Comments

March 27, 2015 | Grain Hedge Insights | Cody Bills

Corn grain basis was unchanged for the week, while soybeans posted a 2-cent advance.


In corn, basis levels were up one-cent a bushel at the Gulf export market, but river terminals were on average unchanged for the week. 

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