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Community Manager
marketeye
Posts: 3,250
Registered: ‎05-03-2010
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Floor Talk February 9 (Report Day)

[ Edited ]

At the close:

The March corn futures settled 5 1/2 cents lower at $6.37. The March soybean contract ended 4 cents lowerat $12.27 1/2. The March wheat futures settled 14 3/4 cents lower at $6.46.  The March soyoil futures settled $0.40 lower at $52.54.
In the outside markets, the NYMEX crude oil is $0.99 per barrel lower, the dollar is lower and the Dow Jones Industrials are up 24 points.

 

Mike

---------

At 12:45pm:

I'm getting tired trying to keep up with this market. Now, corn is down 6 cents. What is going on?

 

Mike

------

At mid-session:

At mid-session, the March corn futures trade 2 1/2 cents higher at $6.45. The March soybean contract is trading 4 1/2 cents higher at $12.36. The March wheat futures are trading 11 3 /4 cents lower at $6.49.  The March soymeal futures are trading $0.80 per short ton higher at $322.50. The March soyoil futures are trading $0.22 higher at $52.80.
In the outside markets, the NYMEX crude oil is $1.11 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 10 points.

 

One analyst describes today's price action like this: "Anything can happen on report day. "It's report day anything can happen and usually does twice. We should close lower off the report, but the opening saw us trading all of today's issues," Hannagan says. "First, we had a less than expected bullish crop report with corn and wheat trading lower and beans slightly higher on the open. Then prices went up off of the bullish outside markets, export sales report and bullish weather reports for South America. At mid-session, prices are pulling back down off the original crop report which should win at days end. The market trades every hat tossed in the ring," he says.

 

Mike

------

At 10:22am:

After closing mostly lower, the markets have screamed higher. At 10:20am, the March corn futures trade 9 cents higher at $6.51 1/2. The March soybean contract is trading 14 1/4 cents higher at $12.29 1/2. The March wheat futures are trading 1 1/2 cents higher at $6.62 1/4.  The March soymeal futures are trading $3.30 per short ton higher at $325.00. The March soyoil futures are trading $0.35 higher at $52.93.
In the outside markets, the NYMEX crude oil is $1.13 per barrel higher, the dollar is lower and the Dow Jones Industrials are down 4 points.

 

 

Mike

--------

At 9:45am:

As expected, the markets are chopping around. Now, corn and soybeans have turned higher. Wheat has fallen.

 

Mike

-----------

At the open:

At the open, the March corn futures trade 3 cents lower at $6.39 1/2. The March soybean contract is trading 2 1/4 cents higher at $12.33. The March wheat futures are trading 4 1/2 cents lower at $6.56 3/4.  The March soymeal futures are trading $0.60 per short ton higher at $322.40. The March soyoil futures are trading $0.09 higher at $52.65.
In the outside markets, the NYMEX crude oil is $1.15 per barrel higher, the dollar is lower and the Dow Jones Industrials are down 22 points.

 

News:

--Iraq has decided to resume imports of U.S. wheat.

 

Mike

-------


At 9am:

A floor trader just told me the Early Calls are now steady-to-a-shade-easier. "The Report didn't give us anything. So, there is nothing to trade. Plus, we have the Ag Forum Outllook around the corner (next week in Washington, D.C.) and that is expected to be market-negative. So, when reports don't give us what we're looking for, the market usually trades lower," the floor trader says.

 

Plus, the OTC market was unchanged at 9am. So, there you go. It's a toss up!.

 

Mike

-------

At 8:13am:

I'm hearing lower Early Calls now. So hang on to your hats. This open is now called lower by this floor trader. He says, "The market is called 2-4 lower corn and beans. Wheat mixed.  I think vol in options will get pressed but flat price should hold."

 

However, the over-the-counter (OTC) market is not doing that bad. So, others are sticking with a steady-to-better opening.

 

OTC Prices:

May Corn=$6.46

May Soybeans=$12.38

May wheat=$6.62

 

Mike

------------

At 7:31am:

Early Calls are corn and soybeans seen as steady to higher, wheat 2-5 cents better.


USDA Estimates:

--Argentina 2011-12 corn production=  22.0 million metric tons vs. its January estimate of 26.0 mmt and the trade's expectation of 22.5 mmt.
--Argentina soybean crop= 48.0 mmt vs. its January estimate of 50.5 mmt and the trade's expectation of 48.5 mmt.
--Brazil soybean production= 72.0  mmt compared to its January estimate of 74.0 mmt and the trade's expectation of 71.7 mmt.

 

Other data:

USDA raised corn exports to 43.2 million metric tons vs. January estimate of 41.9 mmt.

--U.S. 2011-12 corn carryout=801 vs. 797 expected.

--wheat carryout at 845

--soybean carryout at 275 vs. trade's 269.

 

Weekly Export Sales:

Corn=757,800 mt

Soybeans=658,200 mt

Wheat=707,900 mt

 

Traders see the Weely Export Sales as ho hum.

 

-------

REPORT REACTION:

 

One floor trader says, "No changes to bean balance sheet… incremental declines in SA production relative to what was expected…. Even if you believe we lost 10 mmt in SA the USDA will most likely discount it a few tons and a time through the May report. In 2008, when they lost 22 mmt in SA it took until May report to fully reflect in gov’t numbers…. Sales were ho hum with the exception of wheat.. but we have been trading that… I would expect a mixed trade perhaps even set back a bit. Outside markets are supportive with energy higher again today, but not much feature here," he says.

 

One analyst says, "The USDA Report is friendly for corn, cut the carryout by 45 million with an increase in the export target by 50 million bushels
Beans = neutral but a nice export sale again this morning
Wheat = friendly, another draw in carryout to 845 million but the global numbers were huge at 213 MMT, up from 209 estimate. This would be overall I think a little negative. All exports this morning were solid. "

 

Yet another analyst says, "I see nothing terribly surprising in the numbers today.  Probably neutral to negative except for wheat which is neutral to positive.  Export sales a little below expectations.  I think we can be a bit lower to start, say 2 to 4 in corn and wheat and 5 to 10 maybe in beans," he says.

 

Another analyst says, "This report is about as expected for corn, the stocks to use ratio in the US has dropped to the lowest level since the 1994/5 crop year, which should be supportive in the near term for corn prices, since current inventories of  are projected to be unusually low. Corn prices will likely remain supported at least for the next few months until we begin planting this year’s crop in the Northern Hemisphere and can assess its progress. Global corn inventories as expressed in the stocks to use ratio appear to be unusually low, so we will rely heavily on forecast production in the coming crop year to provide potential price relief.
Wheat had no surprises with adequate world supplies confirmed, and soybeans look better supplied than anticipated by the trade," he says.

 

 

Mike

-----------

At 6:35am:

Early calls: Subject to this morning's USDA February Supply/Demand and World Production Reports. Overnight trading has corn 4 cents lower, soybeans 1 cent higher, and wheat 2 cents lower.

 

Trackers:
Overnight grain, soybean markets=Trading mostly lower.
Crude Oil=$0.58 per barrel higher.
Dollar=Higher.
Wall Street=Seen trading lower as Greece's debt drama remains a concern for investors. 

World Markets=Mixed.

 

USDA Report data and reaction coming up at 7:30am CST.

 

 

 

More in a minute,

 

Mike

Community Manager
marketeye
Posts: 3,250
Registered: ‎05-03-2010
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Re: Floor Talk February 9 (Report Day)

Just got off the phone with my traveling Brazilian reporters. Here's a summary of what they are seeing:

 

--Mato Grosso's soybean crop looks excellent.

--In the state of Parana, the No. 2 soybean-producing state, the crop is looking better than it did two weeks ago. With about 40% of the crop in the pod-setting stage, the nice rains that have fallen in recent days and another round of rains starting today and running through the weekend, should really help the crop.The early planted soybeans have suffered loss, but the late-planted crop is doing much better. The reporters are estimating 12.8 mmt of soybeans out of Parana this year.

--These reporters believe Brazil will produce more than the U.S. analysts estimate of 71.7 million metric tons.

--Argentina's corn production will be lower than 21.0 mmt and that country's soybean crop around 47.0 mmt, below what everybody else thinks here in the U.S.

 

For what's it worth. Now, let's see how these Brazilian reporters due against this morning's USDA numbers.

 

Mike

 

Veteran Contributor
aaron-neill
Posts: 68
Registered: ‎05-17-2010
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Re: Floor Talk February 9 (Report Day)

"I think we can be a bit lower to start"

 

Tell me again what numbers he is analyzing?  Tightest world corn stocks in 38 years and lower?

@cfarms76
Frequent Contributor
agmr
Posts: 58
Registered: ‎12-21-2011
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Re: Floor Talk February 9 (Report Day)

Mike

USDA cut world production by 5,530,000 mln/tons .

Sticking with what we hear now and " actually saw " touring fields  during last 8 weeks.

Would cut this latest estimate by another 4-5 mln ( 1 mln Arg , 2-3 Brz and 1 in PY ).

Saw it comming and  said so almost 2 months ago :  no S.A. record crop.

rgds

 

  

Community Manager
marketeye
Posts: 3,250
Registered: ‎05-03-2010
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Re: Floor Talk February 9 (Report Day)

aaron-neill,

 

This data is slightly friendly due to the USDA lowering Argentina's corn production. Even though they didn't lower it much, it's still headed downward. Plus, exports were raised for the U.S. I agree, this market could be headed lower soon after the open. But, it looks like the market wants to start higher and then get sold off quickly.

 

Mike

Veteran Advisor
Mizzou_Tiger
Posts: 2,341
Registered: ‎11-02-2010
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Re: Floor Talk February 9 (Report Day)

hmmmmmm, they raised corn and wheat exports.............who would have thunk it..........

 

soya left along..........

 

world stage, wheat a tick up for year over year.........however we have been dealing with a glut of junk wheat for a year now and it obviously has not crashed the market..........been saying that for awhile, guys dont just switch over to feed wheat on a dime............milling quality is still in great demand, and thats a driver..........

 

corn and soya both ticked down year over year..........we are tighter than a year ago on the world stage...........

 

domestically corn got tighter, wheat got tighter both month to month and year over year..........soya flat MOM and up YOY.........

 

so when you look at the world stage only thing bearish is an uptick in wheat, yet our exports were bumped up and domestically wheat is lower..........so an off-set or even bullish as its telling us the increase on the world stage is junk wheat that will never be used.........

 

corn is down across the board..............seriously..........I am trying to figure out how we can be in a tighter position than a year ago, with a basis that is 50-80 cents over and stronger than last year..........and not run out of corn by summer???

 

soya is down at the world stage and up domestically............tells me the US is holding one of the last bags of soya.........and if we punch 94+M acres of corn.........our acres will for soya will be down in the 72-73M range, could lead to a pretty thin crop...........

Veteran Contributor
unlgrad
Posts: 93
Registered: ‎06-08-2010
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Re: Floor Talk February 9 (Report Day)

Mizzo,  just don't forget about all those unplanted acres last year.  Soya acres should be up and corn up big from last year, unless we have a repeat of last years weather.  Now, that said,  I can't predict what the weather would do, if i could, would not have to farm, that is for sure.

Advisor
vrbuck
Posts: 912
Registered: ‎05-13-2010
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Re: Floor Talk February 9 (Report Day)

Like any report it is the always used fraze."already in the market".  ARG would have needed to get below 20.5 to raise any eyebrows.  I see world wheat stocks have increased so how can USDA raise exports with more wheat competition in the market.

Esteemed Advisor
sw363535
Posts: 4,828
Registered: ‎07-18-2011
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Re: Floor Talk February 9 (Report Day)

uni, 

Yea,   usda kinda forgot those acres also.  So I am not sure there bill be much increase in planted acres, -----( probably some western crp outs, etc)--------but since usda has never acknowledged the unplanted and unharvested , we may not see much bump in acres.

sw
Frequent Contributor
agmr
Posts: 58
Registered: ‎12-21-2011
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Re: Floor Talk February 9 (Report Day)

have  you noticed  the wide differential of a high 30 and  as low as 10 celcius in the south of Buenos Aires and La Pampa ?  Pretty unussual low temps this time of the year in that particular  region  ...... Keep an eye on that . 

 According to the same weatherman  we follow  and correctly saw the drought and its impact on crops in SA well in advance of almost everyone  , he doesnt like the weather  "disturbances"  he s seen so far  . 

 Not calling an early winter YET .... but ... the least  Arg soy crop needs now is an early frost .

Will keep you updated