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09-27-2011 06:27 AM - edited 09-27-2011 02:04 PM
Video: USDA October Report Preview
This analyst tells Agriculture.com that he sees next month's report making downward revisions for corn and soybean 'harvested' acres. Plus, he says the USDA will release record-low soybean stocks. Take a look. This is a solid preview to what's considered the biggest report of the year.
At the close:
The Dec. corn futures settled 4 1/4 cents higher at $6.52 1/4. The Nov. soybean contract ended 3 1/4 cents higher at $12.63. The Dec. wheat futures finished 10 cents higher at $6.58 1/4. The Dec. soymeal futures settled $0.30 per short ton higher at $330.50. The Dec. soyoil futures closed $0.38 higher at $52.78.
In the outside markets, the NYMEX crude oil is $4.19 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 311 points.
One floor trader says there were positives and negatives to the day's higher session.
"On the positive side, Dec. corn closed above the psychological barrier of $6.50. However, we finished 13 cents off the daily high. This is the second time in two weeks we couldn't hold our gains," he says.
This kind of activity signals that traders want to sell the rallies and we will go down and test the $6.30-$6.40 area again, he says.
"The market just doesn't seem to have enough get up and go. Once we get these markets up 15-20 cents, we can't find buyers," he says.
It almost seems that farmers are selling everything they are harvesting, and the better-than-expected yields keep applying market pressure, he says.
With the outside markets sharply higher and very favorable for the grains, yet the corn futures prices are 13 cents off their highs.
Corn is 8 cents higher, soybeans 3 higher and wheat 10 higher.
One analyst is saying, "Midsession prices up 5 to 8 cents reflect the bounce from Mondays lows .The initial opening highs were over done as outside markets had funds over buying what they sold last week. The recovery this week and today comes as traders get positioned prior Fridays quarterly stocks report and wheat production numbers. But traders are being carefull about Friday as the last two USDA monthly reports had the government cutting feed and ethanol usage to curb the scare over production declines."
At the open:
The Dec. corn futures are trading 17 cents higher at $6.65 1/4. The Nov. soybean contract is trading 17 1/2 cents higher at $12.77. The Dec. wheat futures are trading 17 1/2 cents higher at $6.65 1/2. The Dec. soymeal futures are trading $5.50 per short ton higher at $335.80. The Dec. soyoil futures are trading $0.73 higher at $53.13.
In the outside markets, the NYMEX crude oil is $3.00 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 222 points.
Market noise & news:
--There's talk this could be a 30-50 cent rally for corn, before the next move downward. What say you?
--There's a rumor floating around that China has bought U.S. corn. No confirmation can be found.
--USDA says U.S. corn is rated 1% better this week vs. last and soybeans are steady. For corn, 15% of the crop has been harvested and 5% of the soybeans.
--A S. Korea buyer picked up 110,000 mt of feed corn and 55,000 mt of feed wheat Tuesday. S. Korea buyers also purchased 55,000 mt of soymeal.
--Japan wheat imports for November have reached 400,000 mt. That may be it for now though.
Early calls: Corn is seen 10-12 cents higher, soybeans 10-12 cents higher, and wheat seen 12-14 cents higher.
Overnight grain, soybean markets=Trading sharply higher.
Crude Oil=$2.06 higher.
Wall Street=Seen trading higher as the chances increase that the Euro zone policymakers will stem the Greek debt crisis and aid the Euro banks. Meanwhile, the CBOE VIX, the index that measures the nervousness of the market, fell yesterday but is still 20% higher on the month.
As a doorman once said every time I asked how he was doing, "Everything is going the market's way". You all asked for a correction and here it is, maybe..
09-27-2011 06:38 AM - edited 09-27-2011 06:39 AM
We usually speak about the CBOE's VIX. It's the index that reads fear in the stock options market. Did you know the CME Group has started a VIX for corn and soybeans? Though it's not tradeable, it is a new product that was recently started, along with other weekly grain and livestock options. You might find this farm market-related information helpful. I'll let you decide. Grab a full cup of coffee and enjoy this Agriculture.com-based story.
09-27-2011 07:53 AM
Thanks for the info marketeye. A 50% retracement would get us somewhere in the neighborhood of $7.00 CBOT. Our basis narrowed a little yesterday on corn, but the bean basis is still rather wide. So your additional 30 to 50 cents would be real close to that 50% retracement. Not many beans out in our area yet, but they are average at best. Too many drown out spots and the hills burnt up, so we got the best of both worlds. The freeze on Sept. 15th didn't help matters either.
09-27-2011 08:25 AM
09-27-2011 08:31 AM
What's the crop look like in your area, just curious? Also, what's the pace of harvest where you are? Did you get the rains others did, the past few days? And are you sold into 2012 or 2013 yet? Looks like some pretty good price opportunity that far out.
09-27-2011 08:47 AM
Been in the sub 12.5 and sub 3.0 camp since the end of May when we, here in NW Ohio had virtually nothing planted yet. I have to agree on the lower crop acre number. BTW, This drop in price has done nothing but stimulate the end user buying. (And also scare farmers into some sales) After all.....remember 2008!
We are about two weeks away from soybean harvest even getting started.....most of the corn is still pretty green yet. Had 3.2 inches of rain in the last three days.....gonna be a long and late harvest in these parts.
09-27-2011 09:37 AM
Got rain, needed it even though it slows things up.......
No on 12 and 13.......if you believe 11's crop will have the same opportunities as 10's then there will be a chance to price 12's too.......13 is a ways out to bet physical in this market.........