July 20, 2015 | Grain Hedge Insights | Cody Bills | Views: 159

Grains Slide Lower In The Overnight

The grains slipped lower in the overnight trade session with crop conditions expected to be unchanged for corn and weather clearing for the eastern grain belt over the next 10 days.

In the overnight session the grains traded lower with corn down 8 ¾ cents, soybeans down 12 ¾ cents and wheat in Chicago down 10 ¼ cents. The U.S. dollar is trading a fraction of a percent higher and crude oil is unchanged on the day. This morning the Taiwan Flour miller’s Association issued a tender for 104,350 metric tons of wheat to be purchased from the United States.

Crop conditions will be released out at 3 PM CST today, with expectations of corn conditions to be unchanged at 69 percent rated good to excellent and soybean conditions to decline slightly from 62 percent rated good to excellent last week.  Weather looks to clear up for the eastern grain belt for the next 10 days providing some relief from saturated fields which have hindered yield prospects. Temperatures have also moderated throughout the Midwest with highs in the 80’s throughout most of the Midwest today. Another heat event is expected later this week which is expected to be mainly located in Kansas and into the Delta.

New crop corn sales have been behind the average pace for this time of the year. As of last week cumulative outstanding export sales for soybeans delivered in 15/16 totaled to 6,851,276 metric tons, compared to a three year average of 12,034,663 metric tons. New crop corn sales are also behind the average pace with only 3,543,127 metric tons of new crop corn sold, which is only 55 percent of the four year average. The strong dollar and sharp rally in futures prices has many new crop grain buyers sitting on the side line for the time being.

Strategy Grains cut their EU forecast last Thursday after heat and dry weather damaged crop production prospects. Strategy Grains lowered their corn forecast to 66.7 million metric tons down .7 MMT from the June forecast. 

July 17, 2015 | Grain Hedge Insights | Cody Bills | Views: 254
July 16, 2015 | Grain Hedge Insights | Cody Bills | Views: 205

Mixed Export Sales

Cody reviews the mixed export sales report and discusses the weather outlook.

July 16, 2015 | Grain Hedge Insights | Cody Bills | Views: 234

Grains Pop Thursday Morning

The grains popped in the overnight session Thursday morning.

In the overnight session the grains are trading higher with December corn up 6 3/4 cents, November soybeans up 8 3/4 cents and wheat in Chicago up 4 cents. The U.S dollar is trading up nearly ½ a percent and crude oil is up 26 cents this morning.

 

Old crop export sales showed weekly declines for both corn and wheat.  In the weekly sales report wheat booked 291,500 metric tons which was a 16% decline from the previous week. Corn sales were a marketing year low, declining 38 percent from the previous week with 331,100 metric tons sold. Soybeans showed positive sales with 45,500 metric tons booked which is expected considering the time of year.  New crop sales were strong for soybeans booking 507,000 metric tons for 15/16 delivery. New crop corn sales were also strong with 325,100 metric tons sold, up from only 149,010 metric tons sold last week.

 

Yesterday’s ethanol production numbers from the EIA showed production has fallen 3,000 barrels per day week over week to a total of 984,000 barrels per day. Although this was a slight decline from last week it was better than expected and is 41 million barrels per day ahead the same week last year and 106 million barrels per day ahead of the moving average. Ethanol stocks also fell 101,000 barrels to 19.74 million barrels this week.

 

June NOPA crush numbers were higher than expected with 142.473 million bushels crushed in the month of June. This beat the average guess of 141.478 million bushels and is up substantially from last year’s June crush number of 123.117 mbu. Soyoil stocks were reported at 1.574 billion pounds. 

July 15, 2015 | Grain Hedge Insights | Cody Bills | Views: 193
July 15, 2015 | Grain Hedge Insights | Cody Bills | Views: 157

Can Prices Hold onto their Gains?

With the weather clearing up for the grains and resistance in the charts, can corn and soybeans continue their move higher?

In the overnight session the grains traded lower with corn down 2 3/4 cents soybeans down 5 3/4 cents and wheat down 7 cents this morning. The U.S dollar is up a 1/4 of a percent and crude oil is down 35 cents this morning. China’s stock market turned lower in the second half of Wednesday’s trading session closing 3 percent lower. China’s selling pressure in the equities could have a negative impact on soybeans this morning.

 

Weather over the next 8-10 days is looking to provide drier conditions for the corn crop throughout the Midwest providing Missouri and the eastern grain belt a break from the heavy rains that have saturated soils and damaged yield potential throughout the east. With the weather turning positive for crop development, and crop ratings unchanged in the latest crop progress report, the grains may give back some of the recent price gains. Producers should seriously consider some sort of price protection at this juncture. Give the office a call at 877-472-4607 if you have questions about your situation.

 

The charts are also raising a warning flag for corn in particular. December corn reached a critical resistance level of $4.54 yesterday which was near a previous low set back in January and again in June of 2014. That price level which acted as support in 2014 acted as strong resistance on Tuesday. Furthermore, the 100 period moving average on the weekly chart is currently at $4.40, and could also provide some resistance to any attempted move higher. With the weather turning positive and the charts showing clear resistance around these levels we are concerned that prices could come under pressure over the next few weeks. 

July 14, 2015 | Grain Hedge Insights | Cody Bills | Views: 258
July 13, 2015 | Grain Hedge Insights | Cody Bills | Views: 185
July 13, 2015 | | Views: 236
July 13, 2015 | Grain Hedge Insights | Cody Bills | Views: 208

Traders eager for Crop Conditions Report

With the USDA keeping the July yield forecast unchanged more focus will be on today's crop conditions report to confirm that the heavy rain over the last few weeks has in fact damaged crop development.

In the overnight session, the grains are trading slightly lower with corn down 1 1/4 cents on the September contract, soybeans down 7 1/4 cents and wheat down 4 3/4 cents going into this morning’s pause in trade. The U.S dollar is trading up 1/2 a percent and crude oil is down 70 cents this morning.

 

On Friday the USDA released their July WASDE report which showed no yield revisions from the previous month. The average trade guess, however, was expecting to see a 1.1 bushel per acre decrease in soybean yield and a 1.4 bpa decrease in corn yield. Traders seemed to brush off the absence of any significant yield revision with expectations that yield is more likely to be revised in the August report anyway. There will be increased focus on today’s crop conditions report as traders look for confirmation that heavy rains have damaged crop development.   

 

In the July WASDE report old crop ending stocks were slashed more than expected for both corn and soybeans. Corn ending stocks fell 97 million bushels to 1.779 billion bushels and soybeans fell 75 million bushels to 255 million bushels. For corn, old crop demand revisions included a 50 million bushel increase to feed use, a  25 million bushel increase to exports and a 25 million bushel increase to corn used for ethanol.  The revisions in soybean demand included a 15 million bushel increase in exports, a 15 million bushel increase in crushing’s and a 44 million bushel increase to the residual category.

 

Global ending stocks for corn fell from 195.19 MMT in June to 189.95 MMT in July. New crop soybean ending stocks fell from 93.22 MMT in June to 91.8 MMT in July. Global wheat stocks saw a surprisingly large increase which was primarily a result of higher beginning stocks and lower feed use out of China. New crop global wheat ending stocks jumped to 219.81 MMT from just 202.40 MMT in June. The increase was well above analyst expectations and played a role in keeping wheat from closing higher on Friday.   

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