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07-13-2017 06:59 AM - last edited on 07-13-2017 01:46 PM by marketeye
At the close:
At the close, the Sept. corn futures finished 15 3/4¢ lower at $3.69 3/4, while December futures finished 15 3/4¢ lower at $3.83. Aug. soybean futures settled 45 1/4¢ lower at $9.75 1/2, November soybean futures ended 46 1/2¢ lower at $9.87 1/2. September wheat futures closed 25 1/4¢ lower at $5.11 3/4. August soy meal futures settled $18.10 per short ton lower at $317.90. August soy oil futures closed $0.45 lower at 33.07¢ per pound. In the outside markets, the Brent crude oil market is $0.59 per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 25 points higher.
Mike North, President Commodity Risk Management Group, says that the very fickle nature of a weather market is such that when rain arrives into areas of concern and heat subsides, markets quickly lose the steam fueled the rally.
“Market declines are then fueled by panicked speculators looking for an exit. With the heat ridge pattern holding further West than initially forecast and temperatures projected to be much cooler, concern about next week’s weather has evaporated, leaving markets susceptible to the very conditions witnessed in today's trade,” North says.
North adds, “Also fueling this break is the large global bean balance sheet. Traders were reminded in yesterday's report that despite any yield conversation in this country, South America has ample crop to bring to market.”
At the annual The Global Agriculture Industry Summit and China Agriculture in Iowa Thursday, Chinese soybean buyers signed letters of intent to purchase 460 million bushels of soybeans, totaling $4.5 billion. This would be a near record of agreed purchases, according to the Iowa Soybean Association.
At mid-session, the Sept. corn futures are 8 1/4¢ lower at $3.77, while December futures are 8¢ lower at $3.90. Aug. soybean futures are 26¢ lower at $9.94, November soybean futures are 27¢ lower at $10.07. September wheat futures are 23 1/4¢ lower at $5.13. August soy meal futures are $10.50 per short ton lower at $325.50. August soy oil futures are $0.25 lower at 33.27¢ per pound. In the outside markets, the Brent crude oil market is $0.55 per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 32 points higher.
If you missed it, here are the results of Thursday's USDA Weekly Export Sales Report.
Wheat= 357,700 metric tons vs. the trade’s expectations of between 350,000-550,000 mt..
Corn= 440,700 mt. vs. the trade’s expectations of between 350,000-700,000 mt.
Soybeans= 683,000 mt. vs vs. the trade’s expectations of between 250,000-750,000 mt.
Soybean meal= 140,700 mt. vs. the trade’s expectations of between 25,000-200,000 metric tons.
In early trading, the Sept. corn futures are 8¢ lower at $3.77, while December futures are 8¢ lower at $3.90. Aug. soybean futures are 22 1/2¢ lower at $9.98, November soybean futures are 23¢ lower at $10.11. September wheat futures are 11¢ lower at $5.26. August soy meal futures are $8.00 per short ton lower at $328.00. August soy oil futures are $0.37 lower at 33.15¢ per pound. In the outside markets, the Brent crude oil market is $0.29 per barrel higher, the U.S. dollar is higher, and the Dow Jones Industrials are 16 points higher.
Grains and beans were lower overnight after yesterday's WASDE report was surprisingly bearish. Corn and wheat stockpiles were pegged higher than trade expectations, though I can't help but wonder if a lot of people saw that coming considering how many longs dumped their positions ahead of the report. Corn lost 4 cents and wheat was down 11-12 cents overnight.
Beans are down almost 19 cents this morning but it seems nobody noticed that the USDA lowered carryout to well below trade expectations. Bean stocks were lowered from 495 million bushels to 460 million bushels for the 2017-18 year. Depending on which number you looked at, analysts had pegged inventories from 460 million to 475 million bushels.
Here's what happened overnight:
Brent Crude Oil = down 1%
West Texas Intermediate = down 0.9%
Dollar = up 0.1%
Wall Street = U.S. stock futures mixed in pre-market trading.
World Markets = Global stocks mixed after IEA report.
07-13-2017 09:40 AM
How long will it take for "traders" to shrug off this report, which was based on July 1 conditions, and return to trading pre-report viewpoints on ongoing and current conditions? 1 day, 3 days?
07-13-2017 10:22 AM
2. Report comes out very bearish by say
More and more grain months after harvest
Then "some must have ""suspected"" this and
Got out of their longs before.....how did THEY
Something is just plain wrong
07-13-2017 10:52 AM
I have been reading the details of reports for a long time and every time i finish them I find them to give a decent historic prospective and a very broad based projection with an average number stated with a large degree of probability. If we read the complete report it is boring and quite broad based and relies heavily on the law of averages for weather until the courpse is pronounced dead as it always does. Usda should read their own report and stop defending the accuracy of the work, nearly all the data in the reports just projections of potential with a built in variance. To defend it as "exact truth" is just PR work. They are really pretty bland stuff. And if usda is our leading indicator on supply and demand changes we are too disconnected from reality.
The spin from each report is what we actually publicize.
The spin from this report was so bearish that you have to smile and know that there is some panic on the demand side. Like the big lefthander in trouble in the seventh inning desperate for a strikeout. He puts way too much spin on the ball and it breaks into the dirt as he seems to loose control.
When I read the analysis or see it on tv and it is obvious that the analyst picks the details that support his position... especially on reports like this one that are basically neutral.... there was no great revelation in this report and nothing that supports the headlines being printed.
Statements like "corn is the important one" or "beans align with ideas" means your pitcher might be struggling for something to say.
07-13-2017 12:19 PM
I like comparing some of these analysts to a good knuckle ball.
If you watch it at normal speed you don't notice too much except the batter's swing & miss.
sw describes actually reading/reviewing the report which compares to watching that knuckle ball in slow motion from behind the plate.
You have very little idea where its going!! That's why catchers use bigger gloves for them knuckle ball pitchers.
07-13-2017 12:48 PM
Looking forward later today for some meaningful explanations of today's surprisingly adverse price action. At least, about anyone's explanation is likely to be more meaningful than my own observations. I thought the report yesterday was fairly neutral, and of little meaning relative to estimated corn/soybean production and estimated ending stock levels. On a positive note, I feel good about the old-crop sales made on Friday and Monday, maybe should have done more, maybe not. As said before, mid to late-June plantings just generally don't produce the same as April-May plantings, and some of the April corn was also planted a couple weeks later than the last several years, with some emergence/stand problems in different areas. Won't know how significant those things are until Sep-Oct.
07-13-2017 01:14 PM
That is as nice as I have been to usda in a long time, because I think with producer numbers down, they could do much better in this technical age of gadgets and instant reports and stories without research.......better than presenting these 1950's style reports. The report is what it is......not what the usda employee several years ago claimed as he defended the absolute accuracy of projections when questioned with such fervor....... obviously not understanding the complete report himself.
Maybe we are all in fear of loosing our jobs...
07-13-2017 06:50 PM
export agreement announced on soybeans, the second largest deal in history........yet beans drop 44 cents...........
any guess what would happen if announcement that nobody will buy beans for the next 6 months........
I figure that should be worth at least a $1.50 jump up in the market.