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marketeye
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Floor Talk June 11

[ Edited ]

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At the close:

The July corn futures contract settled 4 1/2 cents lower at $4.41. The Dec. corn futures finished 3 cents lower at $4.41. The July soybean futures contract closed 17 cents lower at $14.45. The Nov. soybean futures finished 8 3/4 cents lower at $12.20. July wheat futures ended are 12 cents lower at $5.89. The July soymeal futures contract settled $2.20 per short ton lower at $482.30.The July soyoil futures closed $0.52 lower at $38.42. 
In the outside markets, the NYMEX Brent crude oil is $0.50 per barrel higher, the dollar is higher and the Dow Jones Industrials are 108 points lower.

 

Mike

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At mid-day:

The July corn futures contract is trading 4 1/4 cents lower at $4.41. The Dec. corn futures are trading 4 3/4 cents lower at $4.40. The July soybean futures contract is 3 3/4 cents lower at $14.58. The Nov. soybean futures are trading 7 cents lower at $12.22. July wheat futures are 10 1/2 cents lower at $5.90. The July soymeal futures contract is trading $3.10 per short ton higher at $487.60.The July soyoil futures are trading $0.21 lower at $38.73. 
In the outside markets, the NYMEX Brent crude oil is $0.24 per barrel higher, the dollar is higher and the Dow Jones Industrials are 89 points lower.

 

Jack Scoville, PRICE Futures Group vice-president, says the report was  neutral. "I thought it was pretty neutral and apparently so did the market.  The changes made by USDA were generally in line with trade ideas, and no real excitement either way.  Back to trading weather and demand and the china import issues and going through making sure on collateral issues that have been in the press."

Mike

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At 11:25am:

USDA Releases June Supply/Demand Estimates:

 

2013-14 U.S. Ending Stocks

Corn= 1.146 bill. bu. vs. the trade estimate of 1.170 bill. bu. and the USDA May estimate of 1.146 bill. bu.

 

Soybeans=  125 million bushels vs. the trade estimate of 0.127 million bu. and USDA May estimate of 130 mill. bu.

 

Wheat= 593 million bushels vs. the trade estimate of 590 million bu. and the USDA May estimate of 583 million bu.

 

2014-15 Ending Stocks

Corn= 1.72 billion bu. vs. the trade's estimate of 1.716 bill. bu. and the USDA May estimate of 1.172

 

Soybeans= 325 million bushels vs. the trade's estimate of 319 million bu. and the USDA May estimate of 330 mill.

 

Wheat= 574 million bushels vs. the trade's expectations of 552 million bu. and the USDA May estimate of 540 million.

 

Well, what do you think about these USDA numbers? Old-crop soybean number looks bullish. But, the rest of them seem bearish, huh?

 

TRADE REACTION:

--One analyst summed up today's report like this: "Domestic balance sheets provided little of interest as the numbers fell in line with expectations.  World numbers provided direction for the market as corn ending stocks rose nearly 1 MMT (more than half of that growth coming in the 2013/14 balance sheet) from last month and represents a 13.6 MMT increase over last year.  Soybeans grew as well, .65 MMT with an increase in the 2013/14 balance sheet despite the 5 million bushel reduction to US supply for the same period.  Overall, the report provided little for surprises to the market."

 

--Sal Gilbertie, Teucrium Trading, says, "That today’s USDA Stocks Report is largely a non-event, with the notable exception of a clear disconnect between the higher corn yield anticipated by the trade and the unchanged yield of 165.3 bushels an acre estimate in today’s report. Ironically, the USDA’s delay in raising yield estimates could be in response to the near perfect weather conditions experienced so far this year; any deterioration in weather patterns through pollination in July would allow the USDA to keep its yield projections relatively stable. Soybean numbers had no surprises with tight old crop inventories continuing. Wheat expectations are based largely upon the current non-competiveness in the global markets of U.S. wheat, U.S. food use and exports were reduced accordingly. The global balance sheet of wheat remains well supplied by more than adequate non-U.S. global production. Worth noting is the global increase in demand for both corn and wheat which seems to indicate lower prices are stimulating increased demand."

 

--Dustin Johnson, EHedger grain analyst, says, "The report wasn't much of a surprise, just another confirmation that a big crop is coming.  The reaction to sell corn, sell wheat, but keep soybeans supported is the same trend we have seen for the past month.  That is the favorite of the funds and the real story of why these relationships are behaving the way they are."
 
 Mike

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At 8am:

Here are the trade estimates for today's 11am USDA Supply/Demand Report:

 

2013-14 U.S. Ending Stocks Expected Estimates

Corn=1.170 bill. bu. vs. the USDA May estimate of 1.146 bill. bu.

 

Soybeans= 0.127 million bu. vs. USDA May estimate of 130 mill. bu.

 

Wheat= .590 million bu. vs. USDA May estimate of 583 million bu.

 

2014-15 Ending Stocks

Corn=1.716 bill. bu. vs. USDA May 1.172

 

Soybeans= 319 million bu. vs. USDA May estimate of 330 mill.

 

Wheat= 552 million bu. vs. USDA May estimate of 540 million

 

2014/15 World Carryout

Corn=181.5 mmt vs. USDA May 181.7 mmt

Soybeans= 82.0 mmt  vs. USDA May 82.2 mmt

Wheat= 187.0 mmt vs. USDA May 187.4 mmt

 

2014 U.S. Wheat Production

All Wheat= 1.964 bill. bu. vs. USDA May estimate of 1.963 bill. bu.

 

Ok., so what do you think about this morning's upcoming report? Will it be traded long?

 

Mike

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At 7:30am:

Early calls: Corn is seen 1-2 cents higher, soybeans 1-2 cents higher, and wheat 1-2 cents higher.

Trackers:
Overnight grain, soybean markets=Trading higher.

Brent Crude Oil=$0.37 per barrel higher.
Dollar= Higher.

Wall Street=Seen lower on a downbeat global growth forecast.

World Markets=Europe stocks were lower, Asia/Pacific stocks were mostly higher.

 


More in a minute,

 

Mike