January 06, 2017 | Grain Hedge Insights | Kevin McNew | Views: 102
January 06, 2017 | Grain Hedge Insights | Kevin McNew | Views: 83

Weekly Cash Comments

Weekly Cash Commentary for week ending 01/06/2017

Cash markets saw positive movement to start the year. On average corn was up 1 cent, rising higher for the third week in a row. Ethanol plants moved 1 cent per bushel higher as well. Weekly ethanol production is still ahead of last year’s pace and USDA demand estimates. Last week production hit just above 300 million gallons, well ahead of the USDA demand estimate of 285 million gallons. Corn along the river also continued higher from last week, gaining 2 1/4 cents.

 

Soybeans saw upward movement as well, gaining 3 1/2 cents per bushel. Crush facilities made up for last week’s dip by gaining 7 1/4 cents. Monthly crush data from USDA showed November soy crush at 170.7 MB, slightly below trade estimates of 170.9 MB. USDA pegged corn used for fuel alcohol at 451.9 MB in November, and that's up from 433.9 MB a year ago. Soybeans along the river kept with the upward trend gaining 1 1/4 cents. 

 

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

January 06, 2017 | Grain Hedge Insights | Kevin McNew | Views: 184

Soybeans Firmly in Negative Territory Overnight

Corn and Wheat Add to their Gains for 2017

Corn and wheat continued to add to their gains of 2017 while soybeans was firmly in negative territory for much of the night session. In outside markets crude oil was higher while equities and the US dollar were little unchanged.

 

Wheat continues to find strength from poor US winter wheat conditions and concerns about winter kill in Ukraine. An expected sharp fall in temperatures in Ukraine could damage the country's winter grain crops because of a lack of snow cover on the fields, analyst UkrAgroConsult said on Thursday. Meteorologists forecast a cold snap starting on Jan. 6 and predict that air temperatures will fall on average to 13-17 degrees Celsius below zero, perhaps even to minus 20 degrees.

 

In South America, rains continue to plague the last of the Argentine planting season. Estimates put overall soy planting at 90% done while corn is said to be only 80% planted. Argentina showers return through Monday and the latest models increased the rain coverage. More rains are also expected next Thu./Fri. & two more in 11-15 day, which keeps wetness concerns in place across Argentina corn/soy. In Northern Brazil, 6-10 day rains aid moisture for corn/soy/coffee/sugar, limits dryness to no more than NE 10% corn/soy.

 

The dollar clawed back ground on Friday but was heading for a second straight weekly loss, having tumbled the previous day on a rare piece of poor U.S. data and apparent action by Chinese authorities to shore up the yuan.

 

Weekly export sales were disastrous with soybeans coming in with a cargo and a half of new business at only 87,500 MT.

 

Weekly Export Sales-

                                      Actual       Expected

Corn                                429.3         650-950

Soybeans                           87.5      800-1,200

Wheat                             183.6         200-500


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

January 05, 2017 | Kevin McNew | Views: 238
January 05, 2017 | Grain Hedge Insights | Kevin McNew | Views: 124

Beans Come Under Pressure

US Dollar was Weaker Going into Morning Trade

Grains were lower as beans came under pressure and wheat and corn were fractionally weaker. In outside markets, the US Dollar was weaker while crude oil was in positive territory going into the morning trade.

 

Weather models are showing rains are expected to hit northern Brazil in the coming 10 days with 65% coverage expected. Also, Argentina is not expected to be as wet. However, it is still very wet and rains will be prominent into the weekend. Rains are expected to hamper some late season planting in Argentina.

 

The latest Drought Monitor conditions in the US showed dry conditions eased in the SE US in the last week, but intensified in OK. Little change was noted in other areas of the US Plains.

Stocks of soybeans at Chinese ports are reportedly down. Soy crush demand is still robust with crush margins still seasonally high, but import shipments have been slowed a bit by logistics issues.

Crude oil will get fresh news this morning from EIA on crude oil inventories. Expectations are for a 2.15 million barrel decline in stocks versus last week. However, the past two weeks have seen oil inventories build, contrary to expectations which have been for inventory draw-downs.

 

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

January 04, 2017 | Grain Hedge Insights | Kevin McNew | Views: 128
January 04, 2017 | Grain Hedge Insights | Kevin McNew | Views: 154

USD Backs Off Its 14-Year High

Winter wheat ratings slip substantially

Grains were modestly higher overnight with beans showing a modest boost and corn and wheat trading fractionally higher. In outside markets, the USD backed off its 14-year high from yesterday and oil rebounded from yesterday’s sell-off.

 

Monthly crush data from USDA showed November soy crush at 170.7 MB, slightly below trade estimates of 170.9 MB. USDA pegged corn used for fuel alcohol at 451.9 MB in November, and that’s up from 433.9 MB a year ago.

 

China’s soybean crush continues to be strong. Year-to-date weekly crush figures show soybean crushing up 4.4%. That would suggest China needs to import 87 to 88 MMT vs USDA’s estimate of 86 MMT.

Winter wheat ratings in KS & OK slipped substantially in the monthly state reports. USDA said OK monthly wheat ratings showed only 25% of the crop good to excellent versus 53% at the end of November. KS also fell from 52% to 44%.

 

Oil rose on Wednesday, with top exporter Saudi Arabia expected to increase prices for its crude as part of planned supply cuts, although a strong dollar and moderate economic growth prospects restricted gains.

 

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

January 03, 2017 | Grain Hedge Insights | Kevin McNew | Views: 121
January 03, 2017 | Grain Hedge Insights | Kevin McNew | Views: 199

First Day of Trade Year Saw US Dollar Shooting Higher

Grains Languish and Soybeans Move Lower

The first trade day of the new year saw a continuation of last year’s trend with equities, the US dollar, and crude oil shooting higher, while grains languished and soybeans moved lower.

 

Soybeans at one time was as much as 8 cents higher before turning lower going into the break.  Brazil is likely to see some rains to help limit dryness in Brazil, while Argentina has seen widespread rains. More rain is expected in Argentina for the next week to add to the 10 inches of rain that has fallen in the last two weeks. Argentina still has some acres not planted which may put those acres at risk.

 

In Asia, palm oil, and China soy and meal futures were off sharply overnight. Argentina will start cutting its soybean export tax by 0.5 percentage point every month for two years starting in January 2018, resulting in a 12-point reduction to 18 percent by the end of 2019, the government said in a decree on Monday. When free-market proponent Mauricio Macri became president in December 2015, he cut the tax to 30 percent from 35 percent. He promised at the time that he would keep chopping the levy by 5 percentage points per year every year of his administration. But budget concerns have put that plan on hold.

Taiwan's MFIG purchasing group has issued an international tender to buy 40,000 to 65,000 tonnes of corn which can be sourced from the United States, Argentina, Brazil or South Africa. Algeria's state grains agency OAIC has issued an international tender to buy optional-origin soft milling wheat.
The tender sought a nominal 50,000 tonnes but Algeria often buys considerably more in its tenders than the nominal volume sought.

 

Global equity markets were up sharply which helped push US equity futures. Chinese PMI was up better than expected suggesting manufacturing was running strong.

 

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


 

December 30, 2016 | Kevin McNew | Views: 118

Weekly Cash Comments

Cash markets saw positive movement as the 2016 year nears a close.

On average corn was up 1 3/4 cents, building on last week’s gains. Ethanol plants moved higher as well up 1 1/2 cents per bushel. Corn along the river broke its downward trend gaining 3 1/2 cents this week. Pork producer Smithfield Food Inc. has begun buyer grain elevators and purchasing grain directly from handlers. Last September Smithfield bought two Ohio grain elevators and now buys about 65% of its feed directly from farmers. The long term effects on cash prices if any are yet to be know.

 

Soybeans saw upward movement as well this week gaining 1 1/4 cents per bushel. Crush facilities lost the momentum built over the past two weeks and lost 1/4 cents. Soybeans along the river moved higher, gaining 2 cents. Soybean exports were below expectations this week with only 974,000 MT of beans exported. USDA pegged expectations between 1 million MT and 1.5 million MT.

Corn_2016_12_29

Soy_2016_12_29

 

 

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

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