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07-01-2011 06:33 AM - edited 07-01-2011 03:10 PM
At the close:
The Dec. corn futures settled 23 3/4 cents lower at $5.96 3/4. The Nov. soybean contract ended 18 1/2 cents higher at $13.12 1/4. The Sep. wheat futures settled 2 cents lower at $6.12 1/4. The Dec. soybean meal futures contract closed $10.10 per short ton higher at $341.00 and Dec. soyoil futures settled $0.15 higher at $56.30.
In the outside markets, the NYMEX crude oil is $0.60 per barrel lower, the dollar is lower and the Dow Jones Industrials are up 167 points.
One analyst says, "The China news is reminding everyone that prices have fallen hard even before the USDA reports and is supportive. I also think people do not really believe the planted area estimates from USDA and that is helping. I got a lot of short covering going on here and perhaps a bit of new buying for day trades, but that is about it. I do not have the impression it is a heavy volume day, I think a lot of this is as much lack of offers as much as any real buying. But China was good news for us and reminded us that things are still in demand out there."
The Dec. corn futures are trading 35 3/4 cents lower at $5.84 3/4. The Nov.soybean contract is trading 15 cents higher at $13.09. The Sep. wheat futures are trading 1 cent lower at $6.13 1/4. The Dec. soybean meal futures contract is $6.60 per short ton higher at $337.50 and Dec. soyoil futures are trading $0.01 lower at $56.14.
In the outside markets, the NYMEX crude oil is $1.39 per barrel lower, the dollar is lower and the Dow Jones Industrials are up 121 points.
Dec. corn is trading 38 cents lower, Nov. beans 9 cents higher, and Sep. wheat 1 cent lower.
Sep. corn hit the daily limit down maximum of 45 cents, while July and Dec. corn are trading. July is nearing positive territory, in fact.
At the open:
The Dec. corn futures opened 36 1/2 cents lower at $5.84, while Sep. corn opened 43 cents lower at $6.05. The Nov. soybean contract opened 8 cents higher at $13.01 3/4. The Sep. wheat futures opened 1 1/2 cents higher at $6.15 3/4. The Dec. soybean meal futures contract opened $3.80 per short ton higher at $334.70 and Dec. soyoil futures opened $0.10 higher at $56.24.
In the outside markets, the NYMEX crude oil is $0.64 per barrel lower, the dollar is lower and the Dow Jones Industrials are up 129 points.
The U.S. manufacturing report released Friday shows growth for the month of June.
One floor trader looking at how we can open says, "Funny oct is a ghost town this morning just seeing some -10 bids in dec…if my morning train is any indication could be quiet day. Still like the mkt at these levels…and think dec holds yesterday’s synthetic low.
CZ OTC is now 5.80 bid no offer that is -3 from the synthetic close of 583."
--Russia lifts grain export ban
--IGC ups China's corn output for next marketing year by 6%
--Despite yesterday's bloodbath, corn prices remain 78% higher than a year ago.
--China sought 1.0 million metric tons of U.S. corn this week. Japan's looking too.
Early calls: Corn 35-37 cents lower (remember the limit is 45 cents today), soybeans 10-12 cents higher and wheat 1-2 cents higher.
Overnight grain, soybean markets=Trading sharply mixed.
Crude Oil=$1.07 lower.
Wall Street=Seen trading flat with weak manufacturing reports released Friday by Europe and China. Some important economic reports will be released in the U.S. today.
More in a minute,
07-01-2011 06:41 AM
Good Morning Mike
Great job at the CME conference yesterday- were you the only guy there?
We all ought to put our heads together and get you a REALLY good question for next time that will stump the panel.
07-01-2011 07:09 AM
Thanks for the kind words. There was a nice group at the press briefing. A lot of traders mill around to listen to the analysts comments. A few reporters were there and more on the phone. It's early, everyone was stunned by the number, and yet folks are jitttery at that briefing about what was about to happen in just one hour, following the briefing.....a bloodbath!
Feel free to send questions. Regarding today, I'm watching the OTC market this morning, following the close of the electronic trading, to see how we might open at 9:30am.
I wonder if anybody in the ethanol, livestock, or commercial businesses can tell us if this drop has sparked buying on their end? Anybody want to enlighten the group?
07-01-2011 07:39 AM
The CME Group only does a briefing like that for the bigger reports, not every monthly S/D report.
Limit down, I wouldn't be surprised. I'm curious to see if we get any USDA announcement at 8am on fresh sales.Does anyone think we will see a big purchase from Asia? Or, do you think they will let this thing fall further before loading the vessel?
07-01-2011 07:54 AM
I hate to say it but I think there is more sinking before the ship is righted. Exports just cant make up the demand for the production numbers presented (whether they are accurate or not is another story). Ethanol is really the only thing that can do that now and my understanding is that we are already awash with ethanol and nowhere to use it. The guys on the CME panel disagreed on that point but I tend to think as Ive stated.
07-01-2011 08:48 AM
Local ethanol plant raised basis to 80 Cents over Sept futures for August delivery. Buyer says they are selling every drop of ethanol they can make and want all the corn they can get! He did tell me they bought a lot of corn with a 4 in front of it last year for spring and summer 2011 deliveries. I think they know what's left out in the bins and August will be a tough month to find corn.
07-01-2011 08:52 AM
WASHINGTON, July 1, 2011 -- Private exporters reported to the U.S. Department of Agriculture export sales of 1,140,000 metric tons of corn for delivery to unknown destinations. Of the total, 360,000 tons is for delivery during the 2010/2011 marketing year and 780,000 tons is for delivery during the 2011/2012 marketing year.
The marketing year for corn began Sept. 1.
Per USDA daily announcements page. FWIW the basis/rumor mill/spreads suggested this business took place on Tuesday/Wednesday.....And its going to China.
07-01-2011 09:52 AM
Not to extend discussion from disbelief of yesterday's infamous acreage number, but I wanted to pass along this North Dakota information I gathered a few days ago. I think it shows that ND may have more corn acres survive the flooding than we think.
With 6.0 million acres expected to go to preventive planting, North Dakota is facing substantial acreage losses for multiple crops including corn, wheat, and soybeans, a North Dakota Grain Growers spokesman told me Tuesday.
The acreage breakdown from the losses is still unknown. However, it's important to note that the majority of the area impacted (the western half and northern area) is not where the bulk of North Dakota's corn crop is raised.
The conventional wisdom is that about 500,000 acres of corn could be lost, at this time, the NDGG spokesman says.
Also, the thing to keep in mind here is that 6.0 million acre figure doesn't include flooded land and flooding land.
Driving through the central part of the state, there is virtually no corn that looks like it will reach knee-high by the Fourth of July, the NDGG spokesman says. "This heavy rain has really hurt this crop."
Meanwhile, Doug Goehring, North Dakota Agriculture Commissioner, says that hard numbers on acreage losses from flooding and heavy rains will not be known for certain for another five weeks. "We are estimating that about 400,000 acres or higher of the total 6.0 million preventive planting acres will be corn. The rest of the acres involve soybeans, wheat, durum, canola, and others," Goehring says.
Even after the preventive planting coverage, the state is headed for crop losses up to $1.0 billion. "This is going to be a serious hit to the North Dakota economy. And, more flooding is expected for the Missouri and Souris Rivers. So, we're not done assessing the damage."