February 14, 2018 | Grain Hedge Insights | Kevin McNew | Views: 439

The Wheat Rally Stalls, Corn and Soy also Suffer

Grains Trade Lower in the Overnight Session

In the overnight session the grains traded lower with corn down 1 ½ cents, soybeans down 2 ½ cents, wheat down 4 ½ cents and Kansas City wheat down 3 ¾ cents. After a few days of positive price gains the market is taking a breather with selling across the grain complex.

 

The latest weather report shows that the southern plains is expected to stay dry over the next couple weeks, but excessive moisture is expected in the central and northern Delta. Argentina will continue to struggle through hot dry weather until this weekend when spotty showers are expected to pop up throughout the country. Brazil weather will continue to be positive for crop development but rain next week will cause some delays to harvest in the south central and west central parts of the growing region.  

 

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The National Oilseed Processors Association (NOPA) crush numbers are due out on Thursday and will show the number of bushels crushed by the 13 member companies for the month of January. A Reuters poll of 8 analysts estimates the report will show 165.51 million bushels were crushed. If realized this would be the second largest crush on record. Analysts are expecting oil stocks to be 1.603 billion pounds.

The latest report from France’s Ag Ministry revised its wheat output lower for the third time this year. SRW wheat production was estimated at 36.6 million metric tons down from 37 million metric tons forecast by the organization in December. The revision was due to smaller harvested area.   


 

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

February 13, 2018 | Grain Hedge Insights | Kevin McNew | Views: 188

Export Inspections Were Within Expectations

Grains Trade Mixed in the Overnight Session

In the overnight session the grains traded mostly mixed with March corn down ¼ of a penny, March soybeans up 3 ½ cents, Chicago wheat down ½ a cent and Kansas City wheat down 1 ¼ cents.

 

The most recent weather model keeps the forecast unchanged in Argentina where hot dry weather has the corn and soybean crop under significant stress. Late this week and into the weekend there are chances of thunderstorm activity which is expected to be spotty and not widespread. Some showers may develop in the southern growing regions and move north between February 19th-21st. The weather model then suggests drier weather for the remainder of the month with chances of erratic showers.

 

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The wheat market pulled back slightly in the overnight after a sharp gain in yesterdays trade. Weather in the Southern Plains is expected to stay dry over the next couple weeks which provides support to the market. The latest drought monitor shows the Texas Panhandle, western Oklahoma and southwestern Kansas in extreme drought. Although crop conditions now are not entirely correlated of the final production, moisture will be needed as we move toward Spring.

Export inspections were within expectations or better for corn, soybeans and wheat. Corn inspections however, were on the low end of the range with 835,131 metric tons compared to expectations which ranged from 800,000 to 1,100,000 metric tons. Soybeans export inspections beat the range of estimates with 1,319,038 metric tons inspected for export. Soybean inspection estimates ranged from 800,000-1,100,000 metric tons.  

 

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

February 08, 2018 | Grain Hedge Insights | Kevin McNew | Views: 671

Strong Weekly Export Sales

Grains Trading Higher in the Overnight Session

In the overnight session the grains are trading higher again with March corn up ½ a cent, March soybeans up 2 ½ cents, March Chicago wheat down 2 ¾ cents and Kansas City wheat down 2 cents this morning. The February WASDE report will be released at 11 AM CST today.

 

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Ethanol production increased this week by 311 million gallons a week to 1.057 million barrels/day. This weeks EIA report shows this week’s production is on par with last year during the same week. Over the last six weeks, ethanol production has run 1 percent behind last years pace. Ethanol stocks increased last week to 987 million gallons from 968 million gallons. Seasonally, it is typical to see stocks continue to grow until March as the summer driving season begins to utilize more ethanol. Ethanol stocks are currently the third highest of all time.

 

On Thursday the Brazilian government lowered their forecast for 2017/18 corn production to 88 million metric tons from 92.34 million metric tons in their January forecast. The reduction is a result of growing conditions in the southern part of the country and a reduction in planted acres for the second corn crop. Conab increased its soybean production estimate to 111.55 million metric tons from 110.4 million in their January report.   

 

 

Export sales were strong this week with all three grains meeting expectations on the strong side of the range. Wheat export sales were up 36 percent from the previous week booking 393,400 metric tons. Corn sales were down 4 percent from last week but managed to book 1,769,600 metric tons which was well above the four week average. Today the Agricultural Ministry of China increased their 17/18 forecast for corn imports by 300,000 metric tons to 1.5 million metric tons. The revision in China’s forecast is a result of Beijing’s probe into alleged sorghum dumping by the United States.   Soybean sales were up strongly from last week with 743,200 metric tons sold.

 

Weekly Export Sales-

 

 

Actual

Expectations

Wheat

393

200-500

Corn

1,769

1,300-1,800

Soybeans

743

400-700

 

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

February 07, 2018 | Grain Hedge Insights | Kevin McNew | Views: 586

Southern Plains Dryness Continues Next Two Weeks

Grains Were Mixed in the Overnight Session

In the overnight session the grains were mixed with March corn up 1 cent, March soybeans down ¼ of a cent, March wheat up 5 ¼ cents and Kansas City wheat up 4 ½ cents. Temperatures are cold throughout Kansas and Oklahoma and the Texas Panhandle with temperatures at 5 a.m. ranging from 5 to 23 degrees Fahrenheit throughout the two wheat growing states. The forecast for the Southern Plains shows continued dryness over the next couple weeks.   

 

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The corn spreads between March and the deferred months have tightened since the start of the rally with the H8/N8 spread moving to $-.145 from $-.17 just two weeks ago. The spread has not seen this level since October 18th, 2017.

 

On Thursday at 11 AM CST the USDA will release its February Crop Production and WASDE report. In a Reuters survey of analysts the average trade estimate for corn ending stocks is 2.468 billion bushels compared to the January report of 2.477 billion. The average estimate for soybean ending stocks is 486 million bushels compared to January’s number of 470 million bushels. Wheat stocks are expected to be at 990 million compared to 989 million bushels in the January WASDE report.

The trade is expecting South American production to be revised lower in Argentina but higher for Brazil soybean production. The average trade guess is looking for Argentina corn production to be revised down to 40.68 MMT from 42 MMT in January due to the crop stress caused by hot dry conditions throughout critical growing regions. Argentina’s soybean production is also expected to be revised lower to 54.06 MMT from 56 MMT in January. The average analyst estimate for Brazil corn production is 93.73 MMT compared to 95 MMT in the January WASDE, but Brazil soybean production is expected to be revised higher to 111.20 MMT compared to 110 MMT in the January WASDE.

 

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

February 06, 2018 | Coach’s Corner | Greg Martinelli | Views: 1354

Making Pre-Call Plans

Even professional athletes practice before the big game

Making Pre-Call Plans

Imagine the Philadelphia Eagles spent the two weeks prior to the Super Bowl resting, recuperating, cleaning equipment, sending a few emails and doing TV interviews!

After winning the conference championship game in January, Doug Pederson got the team together and said, “Hey guys, it’s been a long season and you are all experienced players. Many of you played in youth leagues, high school, college and finally, many years in the NFL. So, for the next two weeks, just relax and enjoy yourselves! We’ll go out in the Super Bowl and just wing it.”

          Do you think this happened or ever will happen? Of course not. This is the big event. No matter how long the players have been playing or practicing — no matter how experienced the players are, you practice for the game.

          That is what I want you to think about when making your sales calls. Sure, you know how to sell. Sure, you know the customer and the products you plan to present. Sure, you can “get by” without doing a pre-call plan. However, your customer and your company want you to do it anyway. Why?

Why your customer wants you to pre-call plan. Because you will:

  • Be more focused (waste less of their time).
  • Ask better questions (finding more ways to help them).
  • Have a purpose for the sales call (reduce the social visit selling).

Why your company wants you to pre-call plan. Because you will:

  • Be more focused (waste less of your time and sell more).
  • Be more effective at uncovering other areas to help the customer (sell more).

Why YOU want you to pre-call plan. Because you will:

  • Be more focused (waste less of your time and sell more).
  • Keep yourself from slipping into the social rut. This gets worse the longer you are in sales and the longer you work with a customer.

Best Practices

  1. Use a Checklist!

Pick any one of the many that are out there, but have an actual form or checklist. You can email me at Greg@GregMartinelli.net and I will send you one that I use. A checklist makes sure you are covering all the bases before driving onto the farm or walking into the agribusiness. Quick note: assembling administrative documents is not pre-call planning. While it might be necessary, that’s more of an administrative task than an actual pre-call plan.  

  1. Schedule it!

Often, while coaching sales people and discussing their pre-call planning process, they tell me how busy they are and they simply didn’t have time to do it. Through dialogue, we always arrive back at the same conclusion. It wasn’t because they didn’t have the time. It was because they didn’t take the time. Everyone has the same amount of time (24 hours/day) and we all fill it with what is important to us. When you tell me, you didn’t have time to pre-call plan, you are really saying, “I didn’t think it was important enough to actually do it”. If so, refer back to the reasons you, your customer and your company want you to pre-call plan.

If we truly dig into the reasons we don’t do pre-call planning, we would find a combination of laziness, over confidence and “Not wanting to be Salesy”. Pre-call planning or bringing an agenda to a sales meeting might seem like you are turning your call into a cold or strictly business-like meeting. Fear not! You can still spend some time on the social visit. However, a pre-call plan will make sure you don’t spend the whole time socializing and not selling.

February 06, 2018 | Grain Hedge Insights | Kevin McNew | Views: 656

Stock Markets Tumbled Worldwide as Investors Fled from Equities

Grains Were Mixed in the Overnight Session

In the overnight session the grains were mixed with March corn down 1/4 of a penny, March soybeans up 5 3/4 cents, March Chicago wheat down 1/4 of a penny and Kansas City wheat up 1/4 of a cent.

 

The latest South American weather model showed little change from the previous days forecast. Thunderstorms and showers will move from southern Argentina into the central production region starting Wednesday and more widespread precipitation is expected between Friday and Sunday. The Brazil forecast expects conditions to stay favorable to crop development.

 

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On Sunday, the Chinese Ministry of Commerce announced an Anti-dumping and anti-subsidy investigation on Sorghum imports from the United States which could result in tariffs. The reaction in the US was a sharp decline in basis values between 20 and 80 cents on Monday as a result of the news. The news from China was released only a couple weeks after the US announced that tariffs will be added to solar panels and washing machines from China. The action by both the US and China has analysts concerned of a US and China trade war.

U.S export inspections released on Monday showed that wheat met expectations with 428,557 metric tons inspected for export. Corn and soybeans both beat analyst expectations with inspections totaling to 1,073,868 metric tons for corn and 1,303,723 metric tons for soybeans. Some analysts see the possibility for demand to shift into corn if tariffs are applied to sorghum.

 

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

February 05, 2018 | Grain Hedge Insights | Kevin McNew | Views: 554

Light Snow in the Central Plains early This Week

Grains Lower in the Overnight Session

In the overnight session the grains are lower with corn down 3 ¾ cents, soybeans down 7 ¼ cents, Chicago wheat down 6 ½ cents and Kansas City wheat down 7 cents. Weather forecasts show rains are expected in Argentina for the second half of this week and temperatures in the central Plains in the U.S should not be enough to cause winterkill.   

 

Exporters sell 130,000 metric tons of corn for delivery to South Korea during the 2017/2018 marketing year - USDA

 

Exporters sell 198,000 metric tons of soybeans to unknown destinations of which 132,000 metric tons for 2017/2018 delivery and 66,600 metric tons for 2018/2019 - USDA

 

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Last week was hot and dry in Argentina which depleted topsoil moisture throughout the country and triggered price volatility in the futures market. Over half of the crop production area is now experiencing crop stress with serious stress occurring from La Pampa into western Buenos Aire, Northwest Santa Fe and southeast Santiago del Estero. Precipitation is expected in Argentina in the second half of this week bringing scattered thunderstorms and showers to around 20% of the growing region. More rain is expected from Friday to Sunday which is likely to cover some of the driest areas and bring between .3 and .8 inches of precipitation. Temperatures are also expected to cool into the 70’s and 80’s in the southern growing regions. Despite the forecast for moisture in the second half of the week, Argentina crops will still be under stress over the next couple days and there is no guarantee that the forecast will materialize in the regions that need it most.  

 

Last week’s commitment of Traders report showed that for the week ending January 30th managed money reduced their net short position to 130,942 from 219,676 in the previous week. The latest COT report showed one of the largest week of short covering outside of the growing season. Soybeans also saw significant short covering moving from a net short position of 81,538 to 21,849 contracts short. Money managers also decreased their net short position in wheat from 15,962 to only 1,897.  

 

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

February 02, 2018 | Grain Hedge Insights | Kevin McNew | Views: 321

US Soybean Export Sales Fell to a Seven Month Low Last Week

Grains Down in the Overnight Trade Session

Grains were down in the overnight; March corn was down ¼ of a cent, March soybeans were down 6 ¼ cents and March wheat was down 4 cents.

 

Exporters sell 195,000 metric tons of corn for delivery to unknown destinations during the 2017/2018 marketing year. Exporters sell 170,000 metric tons of corn for delivery to Egypt during the 2017/2018 marketing year. Exporters sell 108,860 metric tons of soybeans for delivery to Mexico during the 2017/2018 marketing year. -USDA

 

Chicago wheat and soybean futures slid for a third session on Friday, with abundant supplies and stiff export competition tempering concern about harsh crop weather in the US and Argentina. Concern about drought damaging the US winter crop, which drove prices to a multi-month high this week, were still underpinning prices, but analysts said it was too early to assess potential damage.

 

US soybean export sales fell to a seven-month low last week, according to government data, as stiff competition from rival exporter Brazil and concerns over lower US crop quality dented demand from key buyers such as China. The poor weekly sales tally has raised concerns that overseas shipments could contract further than expected, sending futures prices down sharply at the Chicago Board of Trade.

 

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The world sugar market is set for a larger surplus than previously expected in the 2017/2018 season, followed by another year of oversupply, according to a Reuters survey of 12 traders and analysts. Sugar prices are seen remaining roughly unchanged in the first quarter of 2018 and recovering slightly by the end of 2018, though still posting a yearly decline.

 

Egypt’s state grain-buyer, GASC, has lowered the minimum required protein content for Russian, Romanian, and Ukrainian wheat to 11.5 percent from 12 percent, a tender document seen by Reuters on Friday showed. Egypt, the world’s largest wheat buyer, is set to hold a purchase tender today for March 5-15 arrival with results expected later today. Egypt requires various protein content levels from suppliers it considers in its tenders based on origin.


 

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

February 01, 2018 | Grain Hedge Insights | Kevin McNew | Views: 578

No Break in Plains Dryness for Next Two Weeks

Grains were Down in the Overnight Session

Grains were down in the overnight session with March corn down 3/4 of a cent, March soybeans down 9 1/2 cents and March wheat down 5 1/2 cents.

 

Chicago wheat futures slid for a second session on Thursday as investors booked profits after a recent rally and set deteriorating US crop conditions against high global supply. Soybeans and corn also lost ground, with forecasts calling for less severe crop weather in major exporter Argentina from next week encouraging the markets to consolidate.

 

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US pork demand is strong, but trade disputes could hit exports. American consumers are snapping up plentiful low-cost pork, but US farmers are worried that trade spats with key export markets in China, Mexico and Canada could hurt a lucrative part of their pork business. The domestic demand outlook remains bright thanks to the strong US economy, upcoming spring grilling season and Easter Holiday ham purchases. US goods in general are attractive to foreign buyers thanks to the recent drop in the dollar.

 

Weekly Export Sales came in high for wheat and corn this week; but soybean numbers were down against expectations.

 

Weekly Export Sales-

 

Actual

Estimated

Wheat - NC

289

0-100

Corn - OC

1,850

1,000-1,500

Soybeans - OC

359

600-1,000

 

 


 

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

January 31, 2018 | Grain Hedge Insights | Kevin McNew | Views: 524

Plains Dryness to Persist the Next Two Weeks

Grains Down in the Overnight Session

In the overnight session the grains are trading lower with corn down ¾ of a cent, soybeans down 5 cents, Chicago wheat down 4 ¾ of a cent and Kansas City wheat down 5 cents. Chicago wheat futures turned lower on Wednesday as a short-covering rally linked to concerns over poor winter crop conditions in the US ran out of steam.

 

US winter wheat is not in good shape according to new data from the US department of Agriculture. Although drawing final conclusions based on midwinter crop conditions is premature, the chance that the US harvest will achieve even average levels is dwindling, especially since weather models have not yet indicated a reliable shift to a widespread wet pattern in the Southern Plains.

 

Late on Monday, many of the USDA’s state statistics offices released monthly crop progress reports that include the condition of winter wheat. The status in top producers, Kansas and Oklahoma, was nothing short of alarming and implied that at least 30 percent of the national winter wheat crop is in the worst condition in well over a decade.

 

Exporters sell 145,000 metric tons of corn for delivery to unknown destinations during the 2017/2018 marketing year. -USDA

 

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Argentina’s corn crop will suffer yield losses due to drought this year and the estimated planting area may drop further because dry weather in the northern part of the country has blocked late-season planting. Regarding the country’s main cash crop, soybeans, no more planting area losses are expected for the 2017/2018 season and the size of the harvest hinges on February rains, which will be crucial after three consecutive months of near constant sun.

 

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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Graphics: MidWest Plan Service, Iowa State University

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April 23, 2018 | Ken Hellevang,Ph.D., PE, Extension Engineer, Professor

Everyone working around stored grain should understand hazards and proper safety procedures
 

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