July 31, 2015 | Grain Hedge Insights | Cody Bills | Views: 127
July 31, 2015 | Grain Hedge Insights | Cody Bills | Views: 135

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.

July 31, 2015 | Grain Hedge Insights | Cody Bills | Views: 99

Soybean Sales Cancellations

A cancellation of soybean sales this morning could continue to put pressure on the commodity as it struggles to rise above the 100 day moving average.

In the overnight session the grains traded mixed with corn up 1 3/4 cents, soybeans down 2 cents and wheat up 5 3/4 cents. Crude oil is trading down 69 cents and the U.S. Dollar has shed nearly 1 percentage point. Soybeans have struggled over the last two days to rise above the 100 day moving average which looms overhead at $9.56. This morning China canceled 200,000 metric tons of old crop soybean sales.  

 

Some reportable sales were announced this morning with 72,136 metric tons of new crop corn sold to Mexico and 36,068 metric tons sold for 16/17 delivery. Exporters also sold 37,250 metric tons of white wheat, 67,650 metric tons of HRW and 22,000 metric tons of spring wheat to unknown destinations for 15/16 delivery. Taiwan’s MFIG group issued a tender to purchase 130,000 metric tons of corn from the United States, Brazil, Argentina or South Africa.

 

Yesterday, the Spring Wheat tour wrapped up after three days scouting the spring wheat crop in the producing state. Results were released on Thursday and estimated an average yield of 49.9 bushels per acre which is well above the 48.6 bushels per acre last year.

 

The latest Planalytics corn and soybean yield forecast was released on Friday, which is based on satellite imagery and uses the NDVI index which basically measures the greenness of the crop. Planalytics corn yield was revised higher by 1.3 bushels per acre to 166.7 BPA. Soybean yield held steady from the previous forecast of 45.6 bushels per acre on July 15th. This forecast is updated every two weeks. 

July 30, 2015 | Grain Hedge Insights | Cody Bills | Views: 137
July 30, 2015 | Grain Hedge Insights | Cody Bills | Views: 200

Grains Higher on Strong Export Sales

Strong export sales this morning helped lift the grains.

In the overnight session the grains traded higher with corn up 3 3/4 cents, soybeans up 10 1/4 cents and wheat up 5 1/2 cents this morning. The U.S. dollar is up nearly 1/2 a percent and crude oil is 29 cents higher. A reportable sale of 140,000 metric tons of old crop soybeans was announced this morning. 

 

Export sales were strong this morning with soybeans and wheat beating analyst expectations. Old crop corn sales booked 364,900 metric tons which was within the analyst expectations and up sharply from last week’s marketing year low. Wheat sales topped expectations by 100,000 metric tons with 699,400 metric tons booked, and Soybeans booked 416,700 metric tons which was well above the 100-200,000 metric tons expected. New crop corn and soybean sales also outperformed with corn booking 443,300 metric tons and soybeans booking 899,100 metric tons. This week’s new crop sales were up substantially from last week.

 

Ethanol production declined 8,000 barrels per day this week to 965,000 barrels per day. This is the third weekly decline, but production levels are still well above last year and 101,000 barrels per day above the 4 year average. Ethanol stocks increased 89,000 barrels per day to 19.65 million barrels this week.

 

Today the spring wheat tour will be releasing its yield forecast after touring North Dakota since Tuesday. So far reports have been very positive with the first day yield estimate coming in 51.1 bushels per acre compared to 48.3 bushels per acre last year.

 

Russia’s largest farming region wrapped up harvest with 9.8 million metric tons of grain, an increase of 650,000 metric tons compared to last year. The Russian grain crop is looking relatively healthy with expectations for 100 million metric tons harvested this year, down 5 percent from 2014.

 

Basis is heating up for end users in the eastern grain belt after weeks of futures price declines. A soybean plant out of Claypool Indiana increased basis another 10 cents to +90X after jumping 10 cents the day before. In Morristown IN, a grain buyer lifted its bid by 15 cents last night to +120X. For producers that still have some old crop in the bins, the futures sell-off has introduced basis opportunity. 

July 29, 2015 | Grain Hedge Insights | Cody Bills | Views: 167

Exceptional Hard Wheat Yields?

Analysts in the northern states are giving mixed yield forecasts for hard wheat. Cody dives into the implications of the report as well as corn and soybean technicals.

July 29, 2015 | Grain Hedge Insights | Cody Bills | Views: 165

Keep an Eye Out for Basis Opportunities

With prices declining over the last couple weeks and soybeans approaching the end of the marketing year, how are you keeping an eye out for basis opportunities?

In the overnight session the grains traded slightly lower with corn down 5 1/4 cents, soybean down 3/4 of a cent and wheat trading down 5 cents this morning as nearly ideal Midwest weather continues to be the focus. December corn is now only 18 cents off the lows it printed on June 15th and 16th. The U.S. dollar is trading a fraction of a percent higher and crude oil is down 43 cents. Asian markets traded higher on Wednesday with Shanghai closing up 3.44 percent.

 

On Tuesday the U.S. Spring wheat tour began. Scouts are touring North Dakota, the country’s largest spring wheat producer to inspect the crop development. Yields are expected to be very good this year with nearly ideal growing conditions in that region. Currently the USDA has spring wheat conditions pegged at 71 percent rated good-to-excellent across the six major wheat producing states and 84 percent good-to-excellent in North Dakota. A final yield projection is expected to be released on Thursday.  

 

Yesterday, we saw some grain buyers in the eastern grain belt lift soybean basis sharply to help draw in any unpriced grain still stored on the farm. Sales have slowed in recent weeks as November soybean prices have slid nearly a dollar from their highs on July 14th. As prices declined, producers have become less willing to sell their soybeans triggering processors and elevators to increase soybean basis. Since July 1st we have observed spot soybean basis in Claypool Indiana increase 50 cents, providing an opportunity for producers in the area who still have grain in the bins. To see what basis opportunities may be in your area click here and take a 14 day free trial at Grain Hedge. Grain Hedge clients have access to a cash market intelligence platform that allows them to monitor basis opportunities within 200 miles of their farm. 

July 28, 2015 | Grain Hedge Insights | Cody Bills | Views: 230
July 28, 2015 | Grain Hedge Insights | Cody Bills | Views: 114

Market Finds Footing in Overnight

Can the market stop its slide in Tuesday’s trade session?

In the overnight session the grains seemed to find some footing with corn up a penny, soybeans up 10 1/4 cents and wheat in Chicago up 4 1/2 cents. The U.S. dollar is trading nearly 1/2 a percent higher and crude oil is up 11 cents. A reportable sale of 120,000 metric tons of sorghum for delivery to China was announced this morning. The sale was split between old and new crop delivery.  

 

Crop conditions were released after the market closed yesterday and showed that corn conditions increased 1 percent in the good-to-excellent category to 70 percent. The market was expecting to see conditions mostly unchanged on the week. Soybean conditions were left unchanged at 62 percent good-to-excellent which missed expectations of a 1 percent increase this week. Spring wheat conditions also improved a percentage point this week to 71 percent rated good-to-excellent.

 

Weather is expected to continue cooperating for the majority of the grain belt with temperatures remaining cooler than normal in the second half of the week with showers throughout the Midwest. The Euro weather model is beginning to show some drier southern Midwest conditions expected to develop in the 6-10 day forecast which we will want to monitor in the days to come.

 

The export inspections report showed that all the grains saw a decline in grain inspections. Corn fell from 1,161,000 metric tons to 1,108,000 MT this year. Soybeans fell from 306,000 to 120,000 metric tons and wheat fell from 489,000 metric tons to 439,000 MT. 

July 27, 2015 | Grain Hedge Insights | Cody Bills | Views: 165

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More Articles

Weekly Cash Comments

July 31, 2015 | Grain Hedge Insights | Cody Bills

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...

[Read More]

Soybean Sales Cancellations

July 31, 2015 | Grain Hedge Insights | Cody Bills

In the overnight session the grains traded mixed with corn up 1 3/4 cents, soybeans down 2 cents and wheat up 5 3/4 cents. Crude oil is trading down 69 cents and the U.S. Dollar has shed nearly 1 percentage point. Soybeans have struggled over the last two days to rise above the 100 day...

[Read More]

Grains Higher on Strong Export Sales

July 30, 2015 | Grain Hedge Insights | Cody Bills

In the overnight session the grains traded higher with corn up 3 3/4 cents, soybeans up 10 1/4 cents and wheat up 5 1/2 cents this morning. The U.S. dollar is up nearly 1/2 a percent and crude oil is 29 cents higher. A reportable sale of 140,000 metric tons of old crop soybeans was...

[Read More]