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Community Manager
marketeye
Posts: 3,041
Registered: ‎05-03-2010
0

Floor Talk September 30 (Report Day)

[ Edited ]

At mid-session:

After already hitting its daily 40 cent 'limit' down, the Dec. corn futures are trading 39 cents lower at $5.92 1/4. The Nov. soybean contract is trading 42 cents lower at $11.88. The Dec. wheat futures are trading 38 1/4 cents lower at $6.16. The Dec. soymeal futures are trading $11.00 per short ton lower at $310.30. The Dec. soyoil futures are trading $1.55 lower at $50.40.

 

In the outside markets, the NYMEX crude oil is $1.05 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 52 points.

 

Mike

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At 10:35am:

Corn comes off its limit and is trading again. One analyst says, "All of the big inside trader people I talked to today say lows are in as today's prices in the bearish stocks number and a bearish slant to the Oct. 12 Crop Report. Adding the stocks to the carryover number is the last of bearish news. The reality of harvest producing bullish yield results will eventually set in, as the corn and bean numbers are not there."

 

Mike

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At 10am:

Corn locks 'limit down' across the board. Dec. corn is at $5.92 1/2!

 

Mike

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At the open:

The Dec. corn futures opened 37 cents lowere at $5.95 1/4. The Nov. soybean contract opened 32 3/4 cents lower at $11.97 1/4. The Dec. wheat futures opened 30 cents lower at $6.23 1/4. The Dec. soymeal futures opened $8.50 per short ton lower at $313.00. The Dec. soyoil futures opened $1.35 lower at $50.64.

 

In the outside markets, the NYMEX crude oil is $1.58 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 79 points.

 

Mike

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At 7:31am:

Stocks:

Corn=1.128 billion bu.

Soybeans=214.7 million bushels

Wheat=2.180 billion bushels

 

Wheat Production=2.008 billion bushels

 

Traders say this report is bearish. Early Calls:  Corn 10-20 cents lower, soybeans 5-10 cents lower, and wheat to follow.

 

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REACTION:

One analyst says, "Corn should be a negative number, beans friendly, and wheat mixed with stocks a little higher and production a little lower.  To me the  report overall is probably a little negative and especially for corn.  Should be a little lower across the board.  I think beyond that we might put the final nail into the coffin for this part of the down move today or early next week.  Just cheap enough for the minute nothing more."

 

Yet another analyst says, "Initial reaction is very bearish to corn coming in 164 million bushels over the trade estimate. This gives us plenty of cushion in the October Report so ending stocks for corn are likely to increase from 670 million at least to 800 million bushels.
Our first initial glance at these numbers are they are so big we can hardly believe them, but that’s USDA for ya. This tells us if the numbers are right that there is plenty of corn in the country, enough to offset a lower harvest in the coming months.
Look for corn to lead the market lower.
Beans were within 10 million bushels of trade estimates but a little supportive, but in our view not enough to offset the corn weakness.
Wheat was also 115 million bushels higher than the trade estimate, so not only more corn in the country, more wheat as well.
Just another example of USDA being outside the trade estimate on 2 of the 3 crops, leaving analysts like me scratching our heads on how an entire industry of trade estimates cannot even get close to what USDA has. Frustrating…."

 

Al Kluis, Kluis Commodities, told his customers that this morning's report is friendly for wheat prices. "The report is considered positive for wheat prices. The USDA indicated a wheat crop that was smaller than indicated because of the large drop in spring wheat production. The spring wheat crop came in down 11% from last month and 6% below trade estimates.  
The USDA was expected to show a slow-down in feed usage this year, but the drop was even larger than expected. The larger stocks number will somewhat offset the smaller yield for corn in 2011."

 

Another analyst says, "The government for the second quarterly stocks report in a row found corn they didn’t know they had, the trade will wonder if they know what corn looks like but obviously its bearish and will have to be added to carry over on the oct. 12 report. While losing some beans we wonder if they will find them later if it fits."

 

 

Mike

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At 6:50am:

Early calls: Subjec to the USDA Stocks and Wheat Production Reports to be released at 7:30am. Overnight, corn is 5 cents lower, soybeans 3 cents lower and wheat 1 cent lower.

 

Trackers:
Overnight grain, soybean markets=Trading lower.
Crude Oil=$0.75 lower.
Dollar=Higher.
Wall Street=Seen trading lower on worsening economic data increasing the worries about a global economic plunge.

World Markets=Asia/Pacific stocks are mixed, while Europe's stocks are lower.

 

More in a minute,

 

 

Mike

Advisor
jrsiajdranch
Posts: 2,117
Registered: ‎05-03-2010
0

Re: Floor Talk September 30 (Report Day)

Quick MT you better say they are lying cause demand is inelastic and we shoulda bought the heck outa this mkt!

Community Manager
Jeff_a_Caldwell
Posts: 966
Registered: ‎04-29-2010
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Re: Floor Talk September 30 (Report Day)

Sounds like we just cut in half the amount of corn that needs to be rationed now. Did $7 cause that kind of rationing all along earlier this summer? 

 

Here's what one analyst says...

-----------------------------------------------
Jeff Caldwell
Agriculture.com Multimedia Editor
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Veteran Advisor
Mizzou_Tiger
Posts: 2,200
Registered: ‎11-02-2010
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Re: Floor Talk September 30 (Report Day)

"The June-August 2011 indicated disappearance is 2.54 billion bushels, compared with 2.60 billion bushels during the same period last year.

3 dollar increase and essentially same usage.........seems inelastic, but then again I am not the sharpest knife in the drawer so you are right and I am wrong....
Senior Contributor
vrbuck
Posts: 609
Registered: ‎05-13-2010
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Re: Floor Talk September 30 (Report Day)

or the corn crop is bigger then first thought.  Whe MT says to buy you better sell.  When MT says sell is when you should be buying with both fists.

Veteran Contributor
glenlivet18
Posts: 118
Registered: ‎06-17-2011
0

Re: Floor Talk September 30 (Report Day)

As I write this Dec Corn is bid limit down.  *Sigh* Obviously I shouldn't have gotten out of my short position last night, but I don't regret it because report days are a crapshoot and I don't trade crapshoots.  I've learned that this sort of thing is a cost of doing business when you trade the grains. 

Veteran Advisor
roarintiger1
Posts: 1,499
Registered: ‎04-29-2011
0

Re: Floor Talk September 30 (Report Day)

This party ain't over......It's just delayed....again.

 

So USDA found more corn?   This is hardly new news.  

 

Usage virtually the same as last year?      Where is this so-called demand destruction?   

 

They already had found 300 million extra bushels in a previous report.......looks like the smoke and mirrors worked again.

"Failing to prepare is preparing to fail." "Success happens when preparation meets opportunity"
Veteran Advisor
Mizzou_Tiger
Posts: 2,200
Registered: ‎11-02-2010
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Re: Floor Talk September 30 (Report Day)

Sounds like a good strategy vr........ask those that used it last fall......worked out well.....got some good prices 4 and 5......

Can't remember but I think last year a similar situation presented itself in the sept report.........I also think someone mentioned it could play out similar this year.....
Community Manager
marketeye
Posts: 3,041
Registered: ‎05-03-2010
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Re: Floor Talk September 30 (Report Day)

The Hightower Report reacts to the USDA data:

 

The USDA report this morning was considered bearish with the market called to open down 15-20 cents lower. September 1st corn stocks were pegged at 1.128 billion bushels, which was 164 million bushels above trade expectations and outside of the wide range of estimates. This is the beginning stocks for the 2011/12 season and if we plug in the new number to the supply/demand report and leave all of the other numbers unchanged, ending stocks are adjusted to 836 million bushels from 672 million posted in the September supply/demand report.
 
PRICE OUTLOOK: A resumption of the downtrend for December corn leaves 616 and 603 1/4 as next support levels. 
 
The USDA reports this morning were considered slightly supportive for the soybean market but a bearish number for corn has caused an opening call of 15-20 cents lower. The USDA pegged September 1st stocks at 214.7 million bushels which was about 10 million bushels below trade expectations. This is the beginning stocks for the 2011/12 season and will tighten the outlook somewhat for the coming season; depending on the October 12th production update.
 
PRICE OUTLOOK: A resumption of the recent downtrend due to bearish news for the corn market leaves 1187 as next downside target for November soybeans.
 
The USDA wheat production report this morning was considered positive to the wheat market but this was more than offset by bearish news for wheat stocks and corn stocks and the market is called 5-10 cents lower on the opening. Traders were looking for spring wheat production near 493 million bushels but the report came in at 462.5 million bushels which is supportive. As a result, all wheat production is pegged at 2.008 billion bushels which is 36 million below trade expectations and down from 2.077 billion as the last USDA estimate. However, September 1st stocks came in at 2.15 billion bushels which was 115 million bushels above trade expectations. The report suggests that wheat feeding was not as high as expected.
 
PRICE OUTLOOK: A resumption of the recent downtrend leaves 606 3/4 as next target for December wheat. 

Contributor
fbf2574789
Posts: 27
Registered: ‎09-15-2011
0

Re: Floor Talk September 30 (Report Day)

Are they adding the corn already harvested this year to figures?