September 08, 2016 | Grain Hedge Insights | Kevin McNew | Views: 222
September 08, 2016 | Grain Hedge Insights | Kevin McNew | Views: 215

Nov Beans Clear the $9.80 Hurdle in the Overnight

US dollar continued to erode and crude oil prices were above $46 a barrel.

Grains rallied again overnight as Nov beans cleared the $9.80 hurdle heading into the morning break. In outside markets, the US dollar continued to erode and crude oil prices were above $46 a barrel.

 

Private analysts continue to weigh in on the US crop size ahead of Monday’s USDA crop production report. Yesterday Linn Group pegged the US corn yield at 171.5, well below USDA’s August forecast of 175.1. For soybeans, they expect a yield of 49.6 bushels per acre versus USDA’s previous forecast of 48.9. Planalytics final forecast for the season was also announced as 171.1 and 49.6.

 

In overnight news, a South Korea feed buyer bought 69,000 MT of optional origin corn. Algeria bought between 300,000 and 400,000 tonnes of optional-origin milling wheat in a tender on Wednesday, paying around $197 a tonne. Some traders put the volume higher at 500,000 tonnes. Algeria, one of the world's largest grain importers, does not publish details of its tenders and results reported by traders are estimates.The wheat was expected to be sourced from several origins, reflecting reduced availability in Algeria's traditional supplier France after a poor harvest, traders said, citing the UK, Germany, Poland and the United States as possible choices alongside France.

 

China imported 7.67 MMT of soybeans in August, down 1.2% from 7.76 million tonnes in July, figures from the General Administration of Customs of China showed. China is also expected to see a smaller corn crop in 2015 as farmers there planted few acres in response to a subsidy elimination by the Chinese government. Production is expected to be off 2% from last year.


Oil prices rose 60 cents a barrel on Thursday after U.S. industry data showed a large drawdown in crude stocks, reflecting the temporary impact of an Atlantic storm. U.S. crude stocks fell by 12.1 million barrels last week, data from API showed after the market settled on Wednesday, compared with expectations for an increase of about 200,000 barrels.


 

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


 

September 07, 2016 | Grain Hedge Insights | Kevin McNew | Views: 237
September 07, 2016 | Grain Hedge Insights | Kevin McNew | Views: 162

Beans Find Strength Overnight

Beans Find Strength Overnight

Grains posted solid gains overnight with soybeans advancing 10 cents in the night session.

 

On Tuesday, USDA’s crop progress report showed corn condition slipped 1% on the week to 74% good to excellent. The crop is rated as 18% mature versus 9% last week. In soybeans, crop condition held steady at 73%. Next week should bring the first report on US corn harvest from USDA.

 

Overnight, the Taiwan Flour Millers' Association issued an international tender to purchase 87,900 MT of U.S.-origin grade 1 milling wheat to be sourced from the United States. The results of a tender by Algeria are expected later today as they are in the market for soft-milling wheat.

 

This morning Stats Canada released stocks forecasts for wheat and canola. Canada’s wheat stocks were pegged at 5.17 MMT on July 31, down from 7.05 MMT a year ago. Traders had expected 4.29 MMT of stocks. Meanwhile, canola stocks were at 2.02 MMT, off of last year’s inventory of 2.54 MMT but higher than average expectations of 1.27 MMT.

 

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

September 06, 2016 | Grain Hedge Insights | Kevin McNew | Views: 227
September 06, 2016 | Grain Hedge Insights | Kevin McNew | Views: 196

Grains Start The Week on a Down Note

Crude Oil is Bolstered by News of a Supply Deal

Grains started the week on a down note as the rally at the end of the week met with selling pressure overnight. In outside markets, crude oil was bolstered by news of a potential supply deal between Russia and Saudi Arabia.

 

On Friday, FCStone raised its forecast of the average U.S. 2016 corn yield to 175.6 bushels per acre, which would be a record high if realized, from 175.0 in its previous monthly report and above USDA’s August forecast of 175.1. It also raised its forecast of the U.S. 2016 soybean yield to a record 50.1 bpa, up from its August figure of 48.8.

For wheat, there was additional pressure following as Egypt's health ministry stated they will no longer accept any trace levels of ergot on inspection of imported wheat shipments.Egypt's state grain buyer GASC cancelled its wheat tender last week after receiving just one offer after the country invoked its zero-tolerance ergot policy. Russia's IKAR agriculture consultancy said on Tuesday it had upgraded its forecast for Russia's 2016 wheat crop by 2 MMT to 72 MMT.


In China, the country's top grain province is offering farmers subsidies to rotate corn with soybeans, as it seeks to cut corn output amid huge oversupply. But observers noted that China's planned rise in soybean output would only meet a small part of demand.

 

Saudi Arabia and Russia agreed on Monday to cooperate in world oil markets, saying they will not act immediately but could limit output in the future, sending prices higher on hopes the two top oil producers would work together to tackle a global glut. Even if the Monday statement was short on action, it marks a significant development in the Russia-Saudi relationship. The two countries have been effectively on opposing sides of the war in Syria, while Moscow is an ally of Iran, an important rival to Saudi Arabia.

 

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

September 02, 2016 | Grain Hedge Insights | Kevin McNew | Views: 257

Weekly Cash Comments

Weekly Cash Commentary for week ending 09/02/2016

Grain basis took a sharp turn lower to start September.

 

On average, corn lost one and a half cents to close the week. Ethanol followed behind losing almost a quarter cent. Ethanol stocks gained another 109,000 barrels bringing the total to 20.93 million barrels. Production was off by about 5,000 barrels per day with production holding steady around 1 million barrels per day. Corn along the river was the biggest loser off six and a half cents per bushel.

 

Basis levels for soybeans were especially weak as September started. This is typical for this time of year as old- and new-crop deliveries begin to merge. On average, soybean basis was off eight cents per bushel. Crush facilities saw decreases of three cents. Soybean facilities along the river were the biggest movers this week off an average of sixteen cents per bushel.

 

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

September 02, 2016 | Grain Hedge Insights | Kevin McNew | Views: 226

July Soybean Crush above Expectations

Grains Find Strength 2nd Day in a Row

Grains found strength for the 2nd day in a row as short covering after a steep slide continues to help lift prices. In outside markets, US jobs grew at a slower rate than expected, pushing the US dollar lower.

 

USDA’s industrial grain use reports were released yesterday after the close. For soybeans, July crush was at 153.4 MB, just slightly above average expectations going into the report. For corn,
USDA estimated fuel alcohol use of corn at 455.4 MB, up from 448.4 MB a year ago.

 

In India, low stocks of wheat are likely to drive the country to buy wheat in the global market. So far in 2016 they have bought 600,000 MT of wheat, the most in nine years. The last time it bought more was in 2006, when surprise purchases of close to 7 million tonnes, combined with production problems elsewhere, helped fuel a near 50 percent rally in global prices. There is some speculation that the government may reduce or eliminate the 25% wheat import tariff.

 

August jobs data showed payroll numbers rose by 151,000, below forecasts of 180,000 and the July number of 275,000. This may push Fed interest rate hikes down the road as job growth is expected to be a key indicator for /near-term Fed interest rate policies.

 

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


 

September 01, 2016 | Grain Hedge Insights | Kevin McNew | Views: 248
September 01, 2016 | Grain Hedge Insights | Kevin McNew | Views: 237

Grains In Positive Territory This Morning

...but continue to struggle with bearish fundamentals

Grains were in positive territory to start the day but continue to struggle with bearish fundamentals.

 

This morning’s USDA export sales report was a mixed bag and will likely do little to stem the wave of selling. New-crop corn sales were disappointing coming in at only 647,000 MT, below expectations ranging from 700-1,100,000 MT. Wheat sales were also sub par at only 279,000 off of expectations ranging from 300-600,000 MT.

 

In overnight news, Japan's Ministry of Agriculture bought a total of 144,385 tonnes of food quality wheat from the United States and Canada in a regular tender that closed late on Thursday.

 

After the close today, USDA will report monthly soybean crushings. That report is expected to show 4.596 million short tons, or 153.2 million bushels, of soybeans were processed in July. The estimates ranged from 152.5 million to 154.2 million bushels. The median forecast was 153.1 million bushels.

 

Gains in Europe helped pull world shares out their longest losing streak of the year on Thursday, as oil prices ticked up before key U.S. jobs data. Friday's U.S. nonfarm payrolls report remains this week's market focus, after Federal Reserve Vice Chair Stanley Fischer said last week the jobs data will be a factor in the timing of central bank interest rate hikes.


 

WEEKLY EXPORT SALES

 

                             OC-Act      OC-Exp            NC-Act       NC-Exp

Corn                         214      -100-150               647       700-1,100

Soybeans                  107      -150-200            1,476     1,100-1,600

Wheat                                                             279         300-600

 

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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