November 13, 2015 | Grain Hedge Insights | Cody Bills | Views: 255

Outside Markets Continue to Move Lower

This morning’s export sales report showed corn and wheat in line with trade expectations while soybeans came in above expectations.

Grains were mixed with little movement overnight as wheat finished the overnight session fractionally higher while soybeans gave up 3 cents and corn was unchanged. Outside markets continued to move lower with the S&P futures and crude oil futures lower.

 

This morning’s export sales report showed corn and wheat in line with trade expectations while soybeans came in above expectations. In other export news, USDA announced a sale of 116,000 MT of milo to unknown destination in their flash reporting system.

 

Today, Informa is expected to release updated 2016 planting forecasts at 10:30 AM CDT while next Monday the monthly NOPA crush estimate for October will be released with traders looking for a 161 MB crush of soybeans.

 

S&P futures (ESZ5) continue to be pressured by weak commodity markets and the potential for a Fed interest rate hike in December. Comments by Fed Chair Yeltsen and other Fed directors yesterday seemed to confirm to traders that an interest rate hike is likely in the December meeting.

 

In crude futures (GCLZ5 / QMZ5), prices continued to move lower following yesterday’s unexpectedly high inventory build of crude stocks. EIA reported that stockpiles increased by 4.2 million barrels last week, compared with expectations for a 1.0 million-barrel build.  Gasoline stocks, which have been hovering at seasonal record highs since early October, fell by 2.1 million barrels, compared with analysts' expectations in a Reuters poll for a 807,000 barrels drop. Distillate stockpiles, which include diesel and heating oil, rose by 352,000 barrels, versus expectations for a 931,000 barrels drop, the EIA data showed. Inventories now stand at their highest for this time of year since 2010.

 

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

November 12, 2015 | Grain Hedge Insights | Kevin McNew | Views: 292

Corn Basis Leaders

Tune in to see how ethanol production is coming and which facilities are leading the charge with high corn basis.

November 12, 2015 | Grain Hedge Insights | Cody Bills | Views: 243

Corn and Soybean Prices Drift Lower in the Overnight

In outside markets, S&P futures and crude oil continued to extend their recent losses.

Corn and soybean prices drifted lower in overnight trade, while wheat posted modest gains. In outside markets, S&P futures and crude oil continued to extend their recent losses.

 

Farm office FranceAgriMer on Thursday raised its monthly estimate of French total soft wheat stocks this season to 5.2 MMT, up from 4.8 million forecast last month. FranceAgriMer left unchanged its forecast of French soft wheat exports outside the European Union in 2015/16 to 11.5 MMT, above the 11.4 million shipped last season.

 

In Ukraine, rains have been somewhat beneficial, but analysts there are still pointing to significant shortfalls in the winter wheat crop. Just on planted area alone, acres are expected to be lower and as of Nov 9 only 59% of the crop has been planted versus 88% this time last year. UkrAgroConsult pegs the 2016 wheat harvest at 19 MMT while Thomson Reuters’ Lanworth group predicts 24.3 MMT. Ukraine’s state weather agency implies a harvest around 21 to 22 MMT. This compares to a 27 MMT crop in 2015.

 

In China, USDA’s attaché says lower corn usage there is the culprit for higher stocks in China. China has had a massive surge of imported sorghum, barley, and DDGS. Combined imports of these three commodities reached 25.6 million tons in MY2014/15 as feed mills searched for alternatives to high priced domestic corn. The attaché raised the MY2015/16 forecast for ending stocks by over 26 MMT to 117 MMT.

 

S&P futures (ESZ5) were lower trading at 2060, off of recent highs at the 2,100 mark. Today Fed Chairwoman Janet Yellen as well as Vice Chairman Stanley Fischer and regional Fed presidents William Dudley, Charles Evans and Jeffrey Lacker will all be giving speeches as traders look for clues on an interest rate hike in December.

 

In crude oil (GCLZ5 / QMZ5), traders will look to EIA’s latest report today for guidance. Market surveys project that crude oil stocks could rise by 1.3 million barrels for the week. In contrast, gasoline and distillates stocks are expected to fall by 0.81 and 0.91 million barrels, respectively. The tug of war between rising crude oil stocks and the falling refined products inventory could swing crude oil prices in either direction.

 

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

November 11, 2015 | Grain Hedge Insights | Cody Bills | Views: 280

Grains Saw Some Recovery in The Overnight

Tuesday’s USDA report gave traders more bearish news to digest

Grains recovered overnight, trying to recoup some of their losses from Tuesday’s selloff in the face of fresh supply and demand news. In outside markets, S&P futures were posting gains, while crude oil and the dollar were lower.

 

Tuesday’s USDA report gave traders more bearish news to digest and US production and enduring stocks came in higher than expected. Corn saw the biggest jump in stocks as carryout went to 1,760 MB versus trade expectations of 1,597 MB. Soybeans and wheat were also above expectations with soybeans at 465 MB carryout versus 436 expected and wheat at 911 MB versus 877 expected.

 

In international news, Egypt’s GASC is holding a tender for the second day in a row, after buying 115,000 MT of wheat from Russia and Ukraine yesterday. In weather, heavy rainfall of 5 to 8 inches returns to southern Brazil over the next 10 days (Rio Grande do Sul & Santa Catarina), while rains finally begin across eastern Brazil (Minas Gerais, Rio do Janeiro, Espírito Santo, and Bahia). Likewise, needed rains of 1 to 3 inches will fall across Ukraine and southern Russia over the next two weeks, aiding the winter wheat crop there.

 

Crude oil prices (GCLZ5 / QMZ5) fell on Wednesday after industry data showed an increase in U.S. stockpiles, and as U.S. output had been surprisingly resilient in the face of lower prices. U.S. crude stocks jumped by 6.3 million barrels in the week to Nov. 6 to 486.1 million barrels, data from industry group the American Petroleum Institute showed late on Tuesday, compared with analyst expectations for an increase of 1 million barrels. Traders and investors were looking ahead to data from the U.S. Energy Information Administration on Thursday, delayed by a day due to a holiday. 

 

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

November 10, 2015 | Grain Hedge Insights | Cody Bills | Views: 246
November 10, 2015 | Grain Hedge Insights | Cody Bills | Views: 278

USDA to release latest Supply and Demand Report at 11:00 CST

Grains were lower overnight while S&P futures were slightly higher and crude oil dipped lower.

Grains were lower overnight while S&P futures were slightly higher and crude oil dipped lower.

 

USDA will release their latest supply and demand report this morning at 11 AM CDT. Expectations are for modest increases in US production and carryout from the October report.

 

US Production (in billion bushels)

                                        Expected                       Range                Oct USDA

Corn                                    13.579                 13.435-13.718              13.555

Soybeans                               3.915                    3.895-3.955                3.888

 

US Ending Stocks (in million bushels)

                                         Expected                       Range               Oct USDA

Corn                                      1,597                     1,461-1,702              1,561

Soybeans                                  436                           375-474                 425

Wheat                                      877                           836-914                 861

 

In overnight news, Brazil's government crop supply agency Conab raised its forecast for a record national 2015/16 soybean crop to between 101.2 million and 102.8 million tonnes on Tuesday, up from 100.1-101.9 million seen last month.   Conab's overall corn forecast, however, fell to between 81.1 million and 82.7 million tonnes, down from 82.6-83.6 million in October, the agency said in its second report of the crop year. Rains are expected to continue over Ukraine and Russia where dry conditions were hampering the winter wheat crop. Monday saw a large selloff in wheat futures in part related to the rains in the FSU states.

 

S&P futures (ESZ5) were lower trying to avoid a fifth straight down day. Analysts blamed Monday’s drop on investors stepping away from stocks because a December interest-rate hike looks more likely. If the Fed is going for a rate hike in December, many investors will now be cautious about buying into equities.

 

Oil futures were moving in and out of negative territory on Tuesday as a top energy watchdog said the decision by the Organization of the Petroleum Exporting Countries to keep pumping could depress prices until the end of the decade. In its World Energy Outlook, the International Energy Agency said “a lasting switch in OPEC production strategy in favor of securing a higher share of the oil market mix” could keep the price of Brent crude at around $50 a barrel through to the end of the decade. Under a more bullish scenario, the IEA said oil could rebound to around $80 a barrel by 2020 as the oversupplied market begins to balance.

 

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

November 09, 2015 | Grain Hedge Insights | Kevin McNew | Views: 278
November 09, 2015 | Grain Hedge Insights | Cody Bills | Views: 259

Soybeans Start the week in Positive Territory

Grains were mixed overnight as soybeans started the week in positive territory while wheat slid lower.

Grains were mixed overnight as soybeans started the week in positive territory while wheat slid lower. Corn was mostly unchanged going into the start of the regular trade session. In outside markets, S&P futures and the dollar were lower while crude oil bounced back to hover around the key $45 a barrel level.

 

Trade ranges in grains will likely be limited in the next two sessions as traders await the latest Supply and Demand forecasts from USDA. For both corn and soybeans, traders look for better US production as compared to USDA in October. Analyst are penciling in higher yields which leads to an overall corn production estimate of 13.579 BB (with a range of 13.435-13.718) versus USDA’s forecast in October of 13.555. For soybeans, analysts look for 3.915 (range 3.895-3.955) versus USDA in October at 3.888 BB. Likewise, ending stocks are expected to be bumped up by USDA in Tuesday’s report, which will be released at 11 am CDT.

 

In Australia, harvest is underway for wheat but rains throughout much of the country are slowing the pace. Concerns on quality are appearing however in some locations but it is still too early to determine a bigger picture with just 15% of the crop received so far. The rains across the country will have an impact on quality however the extent of this will be only known over the coming month.

 

In outside markets, Friday saw a big jump in the US dollar as a stronger than expected jobs report put traders on alert for an interest rate hike at the Fed’s December meeting. The Dec US dollar index futures (DX-MZ5) reached its highest point on Friday since April 2014. The strong dollar makes US exports of commodities more expensive to foreign customers and is limiting export sensitive commodity gains.

 

In crude oil (GCLZ5 / QMZ5), prices recovered a bit in overnight trade as the US dollar weakened. China’s trade figures disappointed analysts’ expectations by a wide margin in October, reinforcing views that the world’s second-largest economy will have to do more to stimulate domestic demand given softness in overseas markets. According the CFTC data, hedge funds raised their bullish wagers on U.S. crude this week by the most in six months as speculators bought into oil contracts in forward months on the bet market fundamentals will take time to improve.

 

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

November 06, 2015 | Grain Hedge Insights | Kevin McNew | Views: 300

Beans Finding Low End Resistance

National soybean basis was up 5 cents this week. Kevin breaks down what he thinks will happen if Soybeans continue lower than the $8.58 mark.

November 06, 2015 | Grain Hedge Insights | Cody Bills | Views: 295

Weekly Cash Comments

Weekly Cash Commentary for week ending 11/06/2015

Basis levels continued to ascend higher this week all the while futures markets came under selling pressure.  For the week ending Thursday, Nov 5th, US average corn basis was up 3 cents a bushel while bean basis posted a nearly 5-cent advance on the week.

 

Basis levels in corn and beans both continued to be supported by plummeting barge rates. On the week, IL River barge rates gave up 5 cents a bushel, which helped push terminal corn bids higher by 4.4 cents a bushel and soy bids up by 7 cents a bushel. At the Gulf, it was a mixed week as export terminal bids were off 2 cents on corn and up 3 cents on beans.

 

For end users, basis levels were up at corn ethanol plants gaining 4 cents a bushel versus 3 cents a bushel on the US average.  Weekly ethanol production was up sharply according to EIA gaining to 969,000 BP versus 944,000 BPD in the previous week. Likewise, soybean crushing plants posted better than normal results with a 5.3 cent advance.

 

Look for basis levels for both corn and beans to continue to capitulate in the next two months on slow farmer selling and weak to lower futures markets.

 

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

Page 12 of 84 pages ‹ First  < 10 11 12 13 14 >  Last ›

More Articles

Grains Lower Overnight

February 08, 2016 | Grain Hedge Insights | Kevin McNew

Grains were lower overnight sinking to fresh lows on the month, while stock futures and crude oil started the day with big losses.

Overnight, Ukraine raised its grain export forecast for the 2015/16 season to around 37 MMT from 36. The increase comes from rising corn demand and...

[Read More]