04-26-2012 06:29 AM - edited 04-26-2012 01:56 PM
Good Read: My co-worker has looked at the U.S. export situation. Here is an article that you might find interesting. Dan Looker finds that U.S. corn exports are becoming less of the world's total grain exports. I promise you that you will find this piece enlightening. Grab a cup of coffee and take a look. A giant no more?
At the close:
The July corn futures settled 6 1/2 cents higher at $6.07 1/2. The July soybean contract finished 4 1/4 cents higher at $14.80 1/4. The July wheat futures closed 9 cents higher at $6.35 1/2. The July soymeal futures settled $4.60 per short ton lower at $421.80 and July soyoil futures finished $0.28 lower at $55.75.
In the outside markets, the NYMEX crude oil is $0.20 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 120 points.
News: CME Group's CEO is leaving. The current president will take Craig Donohue's place in a month, a report out of Chicago says.
Corn, wheat are up 6 cents, soybeans are down 6 cents.
One analyst says, "The export sales were very strong, but the market had expected strong sales. "There seems to be a lot of liquidation-selling going on as the month ends next week. In addition, you got the usual world economic concerns going on too," he says.
Outside markets suggest stronger grains, but this is not really happening, as grains were strong when those showed weakness, he says.
It really seems to be just speculative-selling related to the calendar as much as anything else. Midwest weather forecasts are more moderate now and this is helping the bear case. Charts show that beans and meal made some upside targets for now and that is causing some of the liquidation, as there was not enough follow-through yesterday."
The July corn futures trade 3 1/4 cents higher at $6.04 1/4. The July soybean contract is trading 11 cents lower at $14.65. The July wheat futures are trading 7 3/4 cents higher at $6.34 1/4. The July soymeal futures opened $1.70 per short ton lower at $415.50 and July soyoil futures down $0.56 lower at $55.47.
In the outside markets, the NYMEX crude oil is $0.58 per barrel higher, the dollar is higher and the Dow Jones Industrials are up 56 points.
Also, looking at "The Big Picture" video, Scott Shellady sees this corn market as being tired. Take a look.
At the open:
The July corn futures trade 2 1/4 cents higher at $6.03. The July soybean contract is trading 6 cents higher $14.82. The July wheat futures are trading 3 3/4 cents higher at $6.30 1/4. The July soymeal futures opened $2.60 per short ton higher at $420.00 and July soyoil futures down $0.13 at $55.90.
In the outside markets, the NYMEX crude oil is $0.09 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 50 points.
International Grains Council lowered its 2012-13 wheat output number by 0.7% to 676 mmt.
USDA Weekly Export Sales are friendly for corn and soybeans:
Corn=826,200 mt vs. the trade's expectations of 750,000 metric tons (mt).
Soybeans=1.409 million metric tons, vs. the trade's expectations of 1.1 million metric tons.
Wheat=744,000 mt vs. the trade's estimates of 500,000 mt.
So, very strong soybean sales, again this week. Look for the market to use this report as feed for the bulls.
--Japan buys 106,200 mt of milling wheat Thursday.
--Taiwan passed on a tender to buy U.S. corn and soybeans, because they both were too expensive.
Though it looks like a quieter day for soybeans, keep in mind we have put on 56¢ in four trading sessions, basis the July contract. Overall though, ag commodities as an asset class have been outperformed by equities, lately. So, the trade sees the farm futures losing favor with outside investors. Let's see what the Weekly Export Sales Report says.
At 6:20 am:
Early calls: Corn 3-5 cents higher, soybeans 1-2 cents higher, and wheat 3-5 cents higher.
Overnight grain, soybean markets=Trading higher.
Crude Oil=$0.18 per barrel lower.
Wall Street=Seen trading lower with an eye on jobless data.
World Markets=Asia/Pacific mostly higher, Europe's stocks are mixed.
USDA's Weekly Export Sales Report coming up at 7:30am. Stay tuned for more.
More in a minute,
04-26-2012 08:04 AM
"Though it looks like a quieter day for soybeans, keep in mind we have put on 56¢ in four trading sessions, basis the July contract. Overall though, ag commodities as an asset class have been outperformed by equities, lately. So, the trade sees the farm futures losing favor with outside investors. Let's see what the Weekly Export Sales Report says"
AT these prices (milk excluded) I'm not feeling the need for their price distorting shenanigans to be in the market place messing with the price and creating any more gray hair on my head. JMHO..
04-26-2012 09:11 AM
Hi Mike: It sound like the world is gearing up to use this extra corn as fast as acres are expanding. But the more counties that get into corn large scale the higher the chance that ever year corn production will be effected by a major weather event. Volatility is here to stay.
04-26-2012 09:41 AM
It is interesting how countries are starting to grow more corn. I agree, it will take them a long time to catch our abilities to produce that crop. But, just look at how South America is ramping up corn acres, up 33% next year alone. Countries with the ability to grow are taking notice of corn as being a viable crop.Glad you liked the article.
04-26-2012 10:09 AM
"New players in corn production mean lower prices, according to the USDA, with the average price for this year’s crop hitting $5 a bushel, followed by a $4.30 average in 2013-14. Prices slowly recover, hitting $4.65 by the end of the decade."
More from the USDA mythology department---predicting the future.
Nice read from Mr.. Looker.
I personally enjoy the fact that we are processing and using our grains in new diverse ways, and selling more of it through meats and processed products. Hopefully the old days of giving away, and selling cheap grain to the rest of the world is over. It was not good for us or them. If a more diverse world wide economy is going to work other economies need to be producing also.