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Veteran Contributor
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Registered: ‎09-09-2014
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Floor Talk September 12 (Report Day)

[ Edited ]

At the close:

At the close, the Dec. corn futures finished 6¢ lower at $3.51 1/2, while March futures finished 6¢ lower at $3.63. Nov. soybean futures finished 9 1/2¢ lower at $9.50 1/2, Jan. soybean futures ended 9 1/4¢ lower $9.60 3/4. September wheat futures finished 7 1/4¢ higher at $4.42. Dec. soy meal futures closed $3.60 per short ton lower at $300.00. Dec. soy oil futures closed $0.04 lower at 35.19¢ per pound.  In the outside markets, the Brent crude oil market is $0.17 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 52 points higher.

 

Mike

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At 11am:

USDA Report IS Bearish:

 

The U.S. corn and soybean crops are getting bigger, while stocks get larger, according to USDA.
As a result, the CME Group’s farm markets dropped, following the release of the report. Soybean futures dropped 19¢, corn down 8¢, and wheat down 3¢.
Yields
In its September Supply/Demand and Crop Production Reports Tuesday, the USDA pegged the U.S. corn average yield at 169.9 bushels per acre vs. the average trade estimate of 168 bu./acre and last month’s estimate of 169.5 bu./acre.
For soybeans, the average yield estimate is  49.9 bu./acre vs. the average trade estimate of 48.8 bu./acre and the USDA’s August estimate of 49.4.

U.S. Ending Stocks 2017/18
The USDA pegged U.S. 2017/18 corn stocks at 2.335 billion bushels, compared with the average trade estimate of 2.18 billion bushels and the USDA’s previous estimate of 2.27 billion.
For soybeans, the U.S. ending stocks are pegged at 475 million bushels, compared with the average analysts estimate of 442 million bushels and the USDA’s August estimate of 475 million.
The U.S. wheat ending stocks were estimated at 933 million bushels vs. the average trade estimate of 920 million and the USDA’s previous estimate of 933 million.
 

TRADE RESPONSE

--Jason Roose, U.S. Commodities, says that supply bearish crop report is taking premium out of the grains today following the September USDA supply demand report. The yields on corn and soybeans were again for the second month larger than expected, against most market expectations, large us corn ending stocks  at 2.335 BLN bushels will give the market resistance ,but corn world ending stocks may have peaked. Will harvest around the corner ,the combines will verify the yields on this report.

 

--Sal Gilbertie | Teucrium Trading, says that record projected Russian wheat production, record projected U.S. soybean production, and higher than expected U.S. corn production confirm the adage “cool summers make for high yields” and are helping push prices down toward a possible retest of the August 31 price lows. This was a bearish report, which could support a traditional harvest cyclical low in prices in the coming weeks; we will see if farmers are willing to sell at current prices or if they will store their crops and wait for a post-harvest rally. It seems end users are the winners with today’s report.
 

 

--Matt Pierce, Futures International LLC. Director of Commodity Consulting, says the report is brutally bearish, once again. 

“Yield shock going against the average guess yet again. Its like the USDA see's the average guesses then does the complete opposite. The USDA followed the historical trend of well above the average guess. 7 of the last 10 years the USDA yields were above the average guess in corn and beans.”

 

--Brian A. Rydlund, CHSHedging Market Analyst, says it is another USDA shocker.                    

“I guess I am surprised by the soybean yield, but not the corn yield. The trade had been moving towards the USDA August corn estimates since the August report broke, slowly and reluctantly,” Rydlund says.

 

The bean yield is more of a head-scratcher based on August weather in parts of the Corn Belt.  

 

There were no stunning changes to the soybean supply/demand numbers, Rydlund says.

 

“In the corn supply/demand numbers, exports were pushed up 70 mil bushels, with ethanol use down 15 million bushels.So, carryout a little tighter but plenty high at 2.35 bil bushels. With next year’s ending stocks estimated at 2.335 billion bushels, we got plenty if USDA is right,” Rydland says.

 

Redland adds, “Now we watch actual harvest yields pour in and see what the OCT USDA report bears out.”   

 

Mike

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At mid-session:

At mid-session, the Dec. corn futures are 7 3/4¢ lower at $3.37, while March futures are 9 3/4¢ lower at $3.60. Nov. soybean futures are 17 3/4¢ lower at $9.42, Jan. soybean futures are 17 3/4¢ lower $9.52. September wheat futures are 4 1/4¢ lower at $4.30 1/2. Dec. soy meal futures are $6.50 per short ton lower at $297.10. Dec. soy oil futures are $0.17 lower at 34.98¢ per pound.  In the outside markets, the Brent crude oil market is $0.25 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 64 points higher.

 

Mike

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At 9:15am:

In early trading , the Dec. corn futures are 2¢ lower at $3.55, while March futures are 2 1/4¢ lower at $3.67. Nov. soybean futures are 3 1/2¢ higher at $9.63, Jan. soybean futures are 3 1/4¢ higher $9.73. September wheat futures are 1 1/2¢ higher at $4.36. Dec. soy meal futures are unchanged at $303.60. Dec. soy oil futures are $0.26 higher at 35.41¢ per pound.  In the outside markets, the Brent crude oil market is $0.13 higher, the U.S. dollar is higher, and the Dow Jones Industrials are 54 points higher.

 

Mike

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Corn and soybean futures were lower in overnight trading as the harvest kicks off and everybody awaits today's WASDE report. The USDA said in yesterday's crop progress report that the corn harvest was 5% complete, about average for this time of year. Some analysts are saying the remnants of Irma are going to delay the harvest in some southern states but that won't be seen until next week. Corn was down about 2 cents, beans lost about 2 cents and wheat was down 2-3 cents overnight. The storm is moving inland and is expected to bring rain and flooding to parts of Tennessee and Kentucky and strong winds as far north as southern Mizzou and Illinois in the next couple of days. 

 

In other news, WASDE is on tap for today and analysts are widely expecting the USDA to lower its forecasts for both corn and bean production and yields. The USDA has been known to throw curveballs but the consensus is that the agency will curb its estimates. We'll see. Check out all the details including output estimates in today's 3 Big Things at http://www.agriculture.com/news/three-big-things/3-big-things-today-september-12.

 

Here's what happened overnight:

 

Brent Crude Oil = up 0.5%

West Texas Intermediate = up 0.4%

Dollar = up 0.2%.

Wall Street = U.S. stock futures higher in pre-market trading.

World Markets = Global stocks mixed amid as insurers lead, Asia falls. 

Advisor
Posts: 481
Registered: ‎08-31-2012
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Re: Floor Talk September 12 (Report Day)

Or maybe they'll do a "Wild Thing" impression again like that August report.

https://www.bing.com/videos/search?q=just+a+bit+outside&view=detail&mid=F670178D0F68CC4589E6F670178D...

 

Esteemed Advisor
Posts: 2,448
Registered: ‎04-29-2011
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Re: Floor Talk September 12 (Report Day)

"Forget about the curveball Ricky. Give him the heater."   

 

We are about to see these markets heat up.    Smiley Wink

Honored Advisor
Posts: 14,702
Registered: ‎05-13-2010
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Re: Floor Talk September 12 (Report Day)

There isn`t any pre report trading that would lead one to think it was leaked. It`d be nice to get one farmer friendly report this year.

Senior Contributor
Posts: 277
Registered: ‎08-02-2012
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Re: Floor Talk September 12 (Report Day)

They'll spin it curve ball is an understatement.
Advisor
Posts: 565
Registered: ‎06-03-2010
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Re: Floor Talk September 12 (Report Day)

Mean while back on the farm, immediate concerns how how dry it is out there for harvest. With no soil moisture and no rain in the forecast, beans will be 8-9% most of the afternoon and evening. More yield loss.  Dry conditions will create a much higher fire risk.  Stay safe. Rain won't help the crop much, but it sure would make for a safer harvest. Unless,we go to the other extreme moisture wise as the combines roll hard. Maybe an outdated WASDE estimate is the least of our worries.  We have combine yield reports now. Just looking at the crop progress reports, Iowa's corn is rated better than IL, and IN.   That is interesting.

 

 

Advisor
Posts: 1,337
Registered: ‎08-04-2010
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Re: Floor Talk September 12 (Report Day)

WTH, I don't know where they are getting all the beans? A near 50 bu average soybean estimate is laughable. 

Highlighted
Senior Advisor
Posts: 1,026
Registered: ‎05-20-2010
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Re: Floor Talk September 12 (Report Day)

I would merely replace your H with a F...

 

I just drove from Evansville to Cleveland and saw every single field of beans under moisture stress, some severe, some moderate, but maybe 5% G/E...most of the DC never even got planted it looks like...record yields...horse hockey...

 

The  nice news is that bean basis will be 30 over from Cedar Rapids all the way to Toledo this winter if the situation persists.  :-)

 

Maybe a better question, how in the world do all the industry specialist get it so wrong? They are certainly overpaid for such a horrific track record  (tongue firmly in cheek...pretty sure they know more than NASS)

 

Early yield reports from NC IA are 30% off of last year, admittedly from a very high last year...but it would put them below the national average...that happens once in never   :-)

Veteran Advisor
Posts: 2,622
Registered: ‎02-11-2013
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Re: Floor Talk September 12 (Report Day)

a bushel better on the corn and beans.....and corn at about 170 bu, which I think is trendline......i'll admit, i'm that close to the corn

and bean market.....but from what all I see and read, I too am having a hard time seeing where they get the numbers.

the problem is the traders or "market" trades USDA numbers, and as long as USDA makes a mess, we are in a pickle.

 

Everyone just thought sunny predue  was just wonderful.....everyone liked him, he prayed with the farmers when it was dry

(ah, care to go look at the cracks in the ground...its bad)......he is now the head of the USDA, and the goofy numbers are

coming out of USDA.........perhaps sunny (or sonny), needs to be asked the hard question, and see what he does about it.

 

it would be interesting to see the USDA formula (which should be public information), and this forum is wide spread enough, it might

be interesting to use their own formula, and see what number we come up with.

 

also amazing is how the supply number keeps bouncing around......I know the wheat has been multiplying in the bins.....maybe

corn and beans do the same ?

Senior Contributor
Posts: 345
Registered: ‎05-16-2010
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Re: Floor Talk September 12 (Report Day)

So what is USDA's message?  Are they saying their weekly crop ratings mean nothing or are they saying they just pull these yield numbers out of the terminal portion of their large intestine?