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June 10, 2016 | Grain Hedge Insights | Kevin McNew | Views: 262

Weekly Cash Comments

Weekly Cash Commentary for week ending 06/10/2016

Corn basis was off 1-cent on the week while US soy basis was down 3-cents for the week.

 

Corn basis took a modest 1-cent decline. Ethanol was down nearly 2-cents on the week. Corn river basis was up nearly a cent as export volumes continue to be seasonally robust for this time of year.


In soybeans, the strength in the futures market this week caused US soybean basis levels to slip by 3 cent. River basis was down five and a quarter. Soy plants were also down almost 5 cents on the week.

 

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

June 10, 2016 | Grain Hedge Insights | Kevin McNew | Views: 350

USDA Crop Report Releases Today

Report is expected to show higher wheat carryout

Grains were mixed overnight as traders await fresh input from USDA’s crop report at 11 am CDT today.

 

Kevin will be hosting a Live Stream Commentary this morning--(Live Stream starts at 10:30 am CDT, Crop Report releases at 11:00 a.m. CDT)

Click Here to Register

 

Overall, the USDA report is expected to show higher wheat carryout on the heels of better US production and weaker exports, while corn and soybeans are expected to see a drop in carryout thanks to surging US exports.

 

It also seems likely that USDA will need to lower their Brazil forecasts for corn and soybeans after the government there cut their production forecasts. Brazil’s soy crop is pegged at 95.6 MMT v 99.0 USDA while the corn crop is at 76.2 v 81.0 USDA.

 

India may import 5 million tonnes of wheat in 2016/17 as its local production is hit by back-to-back years of drought amid rising demand, a leading consumer said on Friday.
The country is expected to produce 85 million tonnes of the grain in 2016, a decline of about 2.3 percent from last year, said S. Sivakumar, group head of agri and IT businesses at ITC Ltd.
 

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

June 09, 2016 | Kevin McNew | Views: 320
June 09, 2016 | Grain Hedge Insights | Kevin McNew | Views: 271

US Corn Export Sales Above Expectations

Soybeans Continue their Gains

Soybeans gained for a fourth consecutive session overnight, trading close to a two year high as the market was affected by a forecast of a dry growing season. Crude oil was down on profit taking, following a third straight week of falling inventories.

 

U.S. corn export sales were well above expectations for old crop this morning. Meanwhile, wheat sales were disappointing, albeit South Africa and Brazil were notable buyers of U.S. HRW wheat. Reports from Europe indicate France is still sitting on a large stockpile of wheat. Improved exports are expected to absorb some of the huge surplus generated by a record 2015 harvest. However, overall there have been positive signs for France’s export business. Brazil's livestock producers have been feeding higher quality wheat because of corn shortages. Reports from Brazil show lower estimated old-crop soybean and corn production, off 1.28 and 3.74 MMT respectively.

 

Temperatures are expected to remain high in the grain belt with indications of precipitation in the Gulf region.

 

Tomorrow’s crop report is still expected to show a decrease in corn and soybean carry-out an increase in wheat carry-out.

 

Did You Know

Grain Hedge will be hosting a "Live Stream" for the USDA Crop Report

on Friday, June 10th

(Live Stream starts at 10:30 am CDT, Crop Report releases at 11:00 a.m. CDT)

 

Click Here to Register


 

 

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

Corn                  1,559         900-1,200        120          100-300

Soybean               475            300-500        758           500-700

Wheat                 (200)             -50            223           300-500


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

June 08, 2016 | Grain Hedge Insights | Kevin McNew | Views: 273
June 08, 2016 | Grain Hedge Insights | Kevin McNew | Views: 290

Soybeans Lead the Complex in the Overnight

In outside markets, Crude Oil was Higher

Grains were higher yet again with soybeans leading the complex on a 15-cent advance overnight. In outside markets, crude oil was higher while the US dollar was lower.

 

Grains were higher overnight fueled by weather. The near term weather forecasts turn hot with dryness expected in the western belt and S Plains.While short-term beneficial for crop development, hot weather in June is fueling fears of what could happen in July during the critical growing season.

 

Chinese customs data on Wednesday shows they imported 7.66 mmt of soybeans
during the month of May, that compares to the 7.07 mmt imported in April. For Jan-
May imports totaled 31 mmt, up 14.56% on the year. This morning USDA reported a 132,000 MT old-crop sale of beans to China. This adds to previous sales of 205,0000 MT for new-crop previously reported this week.

 

The crop report on Friday is expected to show the continued tightening of US and world corn and soy stocks on strong demand and crop issues in the Southern Hemisphere while wheat production and stocks are expected to build.

 

API weekly crude stocks were smaller than expected on Tuesday as stocks fell 3.56 million barrels. That compares to last week's change of a 2.35 million barrel build. Official government EIA stocks data will be released this morning with traders looking for a 2.74 million barrel fall in inventories.

 

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

June 07, 2016 | Grain Hedge Insights | Kevin McNew | Views: 322
June 07, 2016 | Grain Hedge Insights | Kevin McNew | Views: 219

Soybeans Advance in the Overnight

Crude Oil above $50 a Barrel

Grains were mixed overnight with soybeans advancing, and corn and wheat declining. In outside markets, crude oil got above $50 a barrel for the first time since May 26 while the US Dollar was mostly steady.

 

Monday after the close, USDA reported the US corn crop at 75% good-to-excellent, up from 72% last week’s report and 74% last year. In the first report of the season for soybeans, the crop condition was rated at 72% good-to-excellent, higher than last year at this time when the score was 69%. Wheat conditions slipped this week, as winter wheat fell to 62% from 63% last week, and spring wheat was unchanged on the week at 79% good to excellent. US winter wheat harvest is 2% completed.

 

US weather shows limited thundershowers in the northern/eastern Midwest from late Wednesday through the rest of the week, favoring northern Illinois, northern/eastern Indiana, and southwest Ohio. Heat builds late in the week in the Midwest/South, peaking Friday/Saturday and then retracting to the southwest corner of the Midwest and Delta by Sunday/Monday before moderating further. Highs will rise into the 90s, with the best shot at mid 90s in Nebraska/Kansas/Missouri/South Dakota/western Minnesota/southwest Illinois/Deep South.
 

The best chance for rain arrives next Monday to Wednesday and favors the northern Midwest and Delta with welcome moisture for corn/soy growth. Showers also favor the northern Midwest in the 11 to 15 day but are more limited, with parts of Missouri/southern Illinois/southern Indiana/Kentucky at most risk to be driest through the next two weeks. While both models do hint at some moderation just beyond the period, the 16 to 30 day guidance shows better agreement to the warmer side for the Midwest, with slipping moisture supplies most likely in the southeast 1/2 of the belt. Forecast confidence does remain very low given relatively poor recent 16 to 30 day model performance, but possible corn risks are elevated compared to yesterday heading into early July.

 

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

June 06, 2016 | Grain Hedge Insights | Kevin McNew | Views: 223
June 06, 2016 | Grain Hedge Insights | Kevin McNew | Views: 264

Grains start the week Sharply Higher

Crude Oil surges

Grains were sharply higher to start the week with soybeans continuing to lead the complex on double-digit gains. In outside markets, crude oil surged and equity futures were modestly higher to start the day.

 

Soybeans continue to be cautious over issues in Argentina as crop losses there and a sharp drop in soymeal exports from the world’s #2 supplier underpin the market. Export competitiveness continues to favor US suppliers with Brazil trading at a $22/MT premium over US export prices. One week ago that premium was only $7/MT.

 

In overnight news, export deals on wheat and corn were active to start the week. Taiwan Flour Millers bought 110,905 MT of US milling wheat while South Korea’s largest feed manufacturer NOFI purchased 267,000 MT of US corn. They also bought 60,000 MT of optional-origin feed wheat and 50,000 MT of soymeal. Another South Korean feed company FLC bought 65,000 MT of corn from the US.

In weather, showers are expected to be limited this week to a few spots in the eastern/ far northern Midwest late Wednesday through Friday, with heat building by late in the week. Highs peak in the 90s for much of the Midwest/South, with mid 90s reaching as far north as parts of the Dakotas/Minnesota/Missouri/southwest Illinois/Nebraska/Kansas by Friday/Saturday. 90s back to the southwest Midwest by late in the weekend and moderate further by Tuesday.

 

For oil, the US dollar fell on Friday following weaker than expected US jobs data has traders banking that the Fed will not raise interest rates this summer. Oil was also propped up by attacks on oil infrastructure in Nigeria, which has already sent the country's output to more than 20-year lows. So far, supply cuts like those in Nigeria or Libya, have been met by rising output in the Middle East, especially Iran, which has ramped up output since the end of international sanctions against it in January. But Iran is returning to international oil markets more quickly than expected and is quickly returning to its maximum capacity. This means that further disruptions in global supplies might not be compensated by rising Iranian output.



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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