July 08, 2015 | Grain Hedge Insights | Cody Bills | Views: 255

Bullish News from the Grains

Worldwide news proved mostly bullish for the markets. Cody reviews ethanol production, export sales, and yield estimations.

July 08, 2015 | Grain Hedge Insights | Cody Bills | Views: 194

Grains Mostly Steady

The grains were mostly steady to slightly lower this morning as China's Shanghai Index sells off sharply on Wednesday.

In the overnight session the grains traded marginally lower with corn down 1 cent, wheat down 5 1/2 cents and soybeans down 1 1/4 cents. The U.S. dollar is trading down 1/3rd of a percent and crude oil has fallen 21 cents. A reportable sale of 240,000 metric tons of new crop soybeans was announced this morning.


On Wednesday, the Chinese market fell 5.9 percent causing the exchange to halt trading in 1,331 companies. Since the height of the market the Shanghai Composite Index has now fallen 32 percent. This major selloff in the Chinese equity markets will affect commodities as investors shore up capital to meet margin requirements, hedge equity losses and/or redeploy capital in the wake of sharp selloff.  


Last night brought between .5-1 inch of precipitation between Oklahoma, north central Texas, Kansas City and Western Indiana. For Missouri, a state that has planted only 73 percent of soybeans as of July 5th, more rain is expected in the forecast throughout today and Thursday. Weather should begin to clear in Missouri next week with most of the precipitation focused on the eastern grain belt covering Indiana and Ohio. Temperatures throughout the majority of the Midwest will remain cooler than normal.  


Cargill offered U.S. wheat for $260 per metric ton in the latest GASC tender. This was significantly higher than Ukrainian wheat offered at $202 per metric ton and Russian wheat offered at $202 per ton. The strong dollar, along with the sharp grain rally over the last three weeks has hurt U.S. competitiveness on the global market.       

July 07, 2015 | Grain Hedge Insights | Cody Bills | Views: 268
July 07, 2015 | Grain Hedge Insights | Cody Bills | Views: 313

Grains Lower on Better than Expected Crop Conditions

Grains trading lower in the overnight session.

In the overnight session the grains are trading lower with corn down 6 3/4 cents, soybeans down 5 1/4 cents and wheat down 9 1/4 cents. The US dollar is trading nearly 1 percent higher and crude oil is up 8 cents.


Analysts were expecting corn good-to-excellent ratings to decline by 1 percent and for soybean ratings to decline by 2 percent early yesterday. However, the crop progress report showed that corn conditions are slightly better than expected at 69 percent good-to-excellent which was a one percent improvement from the previous week. Soybean conditions held steady at 63 percent good-to-excellent which was unchanged on the week.


Soybean plantings increased 2 percent to 96 percent planted this week after rains disrupted any real opportunity to plant in Missouri last week. Missouri is now 73 percent planted. Winter wheat conditions showed a 1 percent increase this week but spring wheat conditions fell 2 percent this week.


Yesterday the export inspections report showed soybeans recorded 197,441 metric tons inspected which was within the analyst expectations which ranged from 125,000 to 275,000 metric tons. Corn inspections was reported at 839,324 metric tons which missed analyst expectations and wheat recorded 368,818 metric tons inspected for export this week which was within the range of expectations.  


Weather doesn’t look to favorable for the later parts of this week. Rain is expected in the forecast for the eastern, central and southwestern areas over the next few days which will continue to add stress to already saturated fields. 

July 06, 2015 | | Views: 504
July 06, 2015 | Cody Bills | Views: 230

Grains Sink on Greece Vote and Rain Reprieve

Grain markets came back from the holiday weekend in a selling mood with soybeans off 20 cents, wheat off 15 cents and corn down 10 cents.

Global markets were generally sour overnight following the election results in Greece where voters there shunned the EU & IMF bailout deal. Greek banks are said to be running out of cash and facing the danger of collapse within days without new aid. Amidst this uncertainty, equity markets in the US were sharply lower overnight as was oil while the dollar was up on a flight to stability.

Over the weekend, weather was more benign than expected going into the weekend as rain accumulations in flooded areas were limited.  However, over the next two days storms are expected to bring more rain to Missouri and the Southern parts of IL/IN/OH where flooding has been most problematic. After the close of trading today, USDA will announce the latest crop condition scores and traders expect another drop in crop conditions.


Internationally, France found a bit of relief from the dry heat wave over the weekend with cooler temps and some modest precipitation. However, Western Europe is still expected to be dry for the next 10 days despite the break in heat. On the Canadian prairies, they too found some relief over the weekend from scorching temperatures but there is little change in the outlook which points to a continuation of the heat wave and dry conditions that have plagued the region in the past month. 

July 02, 2015 | Cody Bills | Views: 396
July 02, 2015 | Grain Hedge Insights | Cody Bills | Views: 255

Soybean Cancellations

Soybean sales missed export sales expectations showing net cancellations on the week.

In the overnight session the grains traded lower with corn down 2 1/4 cents, soybeans down 8 3/4 cents and wheat down 9 1/2 cents this morning. Crude oil is trading up 25 cents and the U.S. dollar is down nearly a quarter of a percent.


On Wednesday, the EIA ethanol production report showed a weekly decline of 26,000 barrels per day to 968,000 barrels per day. Weekly production was 15,000 barrels per day above last year’s pace and well above the four year average of 898,000 barrels per day. This year’s production is 4.6 percent above last year’s levels. Ethanol stocks fell 308,000 barrels this week to 19.532 million barrels.


Old crop corn sales showed 594,300 metric tons was booked last week, up 20 percent from the previous week and on the high side of analyst expectations which ranged from 300,000 to 600,000 metric tons. New crop sales met expectations by booking 238,900 metric tons this week. Soybean sales disappointed analysts with net reductions by 10,300 metric tons, well below what analysts were expecting which ranged from 100,000 to 200,000 metric tons. New crop soybean sales were also light, booking 127,500 metric tons this week.  Wheat sales met expectations booking 363,900 metric tons.

July 01, 2015 | Grain Hedge Insights | Cody Bills | Views: 362
July 01, 2015 | Grain Hedge Insights | Cody Bills | Views: 282

Grains Pause in the Overnight

The grains gave back some of their gains in the overnight session after yesterday’s USDA reports triggered a sharp rally in the market.

In the overnight session we have pulled back a bit with corn down 7 cents, soybeans down 5 1/2 cents and wheat down 17 cents this morning. The U.S. dollar is trading higher by a half a percent and crude oil is down 79 cents this morning.


Yesterday’s quarterly grain stocks and planted acreage reports pushed the market sharply higher within sight of some important chart resistance levels.  September corn resistance is at $4.30 where the market closed back on December 29th.  September wheat resistance is at $6.60 where the market closed back on December 18th and soybeans traded up to a high of $10.45 1/2 in the overnight which is an area that acted as resistance multiple times between November and January of last year.


The June 30th planted acreage report showed lower than expected planted acreage estimates for corn and soybeans. For the second year in a row the U.S. is planting record soybean acreage estimated at 85.139 million acres which was higher than the March 31st acreage numbers, but slightly lower than analyst expectations which averaged 85.171 million acres. The USDA followed their acreage report with an announcement that they will be resurveying Cotton, Soybeans and Sorghum acres in Texas, Kansas, Arkansas and Missouri after excessive rain caused planting delays.


Corn acreage slid 302,000 acres from the March 31st report to 88.897 million acres. This will be the lowest corn acreage since 2010, and is below analyst expectations which averaged 89.292 million acres. Wheat acres surprised the market with 56.1 million acres planted in 2015, which is 233,000 acres above the average trade guess and 733,000 acres above the March 31st forecast.


Corn stocks were reported at 4.45 billion bushels, 105 million bushels below the average trade expectations. Soybean stocks were also lower than expected with 625 million bushels, compared to expectations of 670 million bushels which helped bring buyers into the market. Wheat stocks were reported higher than trade estimates with 752 million bushels compared to analyst estimates of 718 million.

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