07-09-2010 06:53 AM - edited 07-09-2010 04:21 PM
I just arrived in Bloomington, IL. The corn and soybean crops look really good along I-55, from Chicago to Bloomington. I mean some of this crop looks outstanding! I did see a few bean fields that are behind schedule. But, for the most part, this is not one of those areas the market is worried about. I did see some spraying, both air and ground. Other than weeds, I'm not sure if what they are spraying for. Hopefully, I'll get a chance to find out and I'll pass it on. Anyway, just wanted to pass along my 2¢ crop report.
By the way, for what it's worth, Neb. Senator Ben Nelson told Dow Jones reporters he believes the gov't will up the ethanol gasoline blend to 15% by the end of summer. Now, the market will pay attention to that. Maybe some of that is already built in, but it still will get the hair on the market's back to stand up.
What else is out there? You tell me. Thanks.
At the close:
The Dec corn futures closed 1 cent lower at $3.95 1/4. The Nov. soybean contract finished 7 1/4 cents higher at $9.52 1/4. The Sep. wheat futures settled 10 1/2 cents lower at $5.38. Dec. soybean meal futures closed $3.60 higher at $279.20 per short ton. Dec. soyoil futures settled 58 points higher at 38.27.
In the outside markets, the NYMEX crude oil is $0.66 higher per barrel, the dollar is higher, and the Dow Jones Industrials are up 17 points.
Two reports were released today and weather trumped both of them. For the next two months, weather will be the main market factor.
At mid-session, the Dec corn futures are steady at $3.96 1/4. The Nov. soybean contract is 5 1/4 cents higher at $9.51 1/4. The Sep. wheat futures are 15 cents lower at $5.33 1/2. Dec. soybean meal futures are $0.16 higher at $277.20 per short ton. Dec. soyoil futures are trading 49 points higher at 38.18.
In the outside markets, the NYMEX crude oil is $0.57 higher per barrel, the dollar is higher, and the Dow Jones Industrials are up 4 points.
One trader says there was some decent activity on the open. But, now the market is back into its summer doldrums.
In early trading, the Dec corn futures are 1 1/4 cents lower at $3.95. The Nov. soybean contract is trading 1 cent higher at $9.47. The Sep. wheat futures are 15 1/2 cents lower at $5.33 3/4. Dec. soybean meal futures are $0.80 higher at $276.40 per short ton. Dec. soyoil futures are trading 21 points higher at 37.90.
In the outside markets, the NYMEX crude oil is $0.40 higher per barrel, the dollar is higher, and the Dow Jones Industrials are 25 points.
One analyst says he his calling the USDA report neutral to negative. "I didn’t see anything friendly or bullish like we saw last week. Corn carryouts declined, just not as much as the trade had expected.
1.478 billion old crop corn tightens the belt for next year to 1.373 billion bushels assuming a yield of 163.5 bpa. 163.5 is still attainable, but we cannot afford to go hot/dry for the rest of the summer. We will continue to need timely rains across the Midwest. I view the weather forecast as supportive to grains with rain in the near-term but hot/dry in the extended outlook. Beans in line with expectations both old/new stocks
Wheat stocks were higher than the trade expected for next year with a carryout 1.093 billion bushels and old crop stocks were neutral at 973 million bushels.
It was World Wheat stocks that were bearish only declining 7 MMT when the trade expected 10-15 MMT declines.
I think this report will give us the setback that end users desperately need as they missed the last run up in prices, as did most people in the world. The healthiest thing for the corn market is to correct and give importers, ethanol plants, and livestock producers another chance to buy, that would likely be more bullish than prices going straight up and putting end users on their backs once again.
Remember, demand, demand, demand, that is the key to any bull market," he says.
USDA S/D Report seems negative, at first glance:
U.S. Wheat Production at 2.216 billion bushels vs. avg. trade estimate of 2.164.
Corn=1.373, higher than trade estimate of 1.337.
Soybeans=360 million metric tons vs. trade estimate of 354 for 2010-11.
Wheat=1.093 billion vs. 1.033 billion bushels for 2010-11.
The 2009-10 numbers are bearish too. We could be trading weather, not this report, by 10am.
Early calls: Subject to the USDA July Supply/Demand and Weekly Export Sales Reports to be released at 7:30am CST. Overnight trading saw corn down 2 cents, soybeans down 1 1/2, wheat down 6 cents.
China's June soybean imports of 6.45 million metric tons has set a new record, according to the China National Grains and Oils Information Center, the Dow Jones newswire reports. For July, China is expected to impoet 5.0 million metric tons of soybeans. In August, imports are pegged at 4.5 million metric tons. And in September, China is see importing 4.0 million metric tons of soybeans. Now for my own comment, there's 20 million metric tons of soybeans in four months. How much of that will come from the U.S.? That's the question the trade is asking. A lot of it already has been of U.S. origin.
Overnight grain=Trading lower.
Crude oil=$0.28 per barrel higher.
Wall Street= Seen opening higher as investors await next week's quarterly earnings reports from numerous companies.
World Markets=Trading higher.
More in a minute,
07-09-2010 07:50 AM
From my perspective...... This report came in about where I think the trade was thinking as a whole...... With corn projected @ 10% of use as a carryout for next year....... NO ROOM FOR ANY WEATHER THREAT!!!!!! .......Sorry for yelling.......:~)...... p-oed
07-09-2010 10:54 AM
mike, with the big SA crops, arent the 1.00 plus premiums over cbot at the ports unusual for this time year? thanks d7
07-09-2010 04:33 PM
Mike..... The crops are rated 71% good to Ex...... They should look good or this market will be like a rocket to the moon...... we only need to nock off a couple of bu from the USDA's 163.5..... well it's not hard to do the math..... p-oed
07-09-2010 06:04 PM
You are so right, it is all about weather. Good weather...good crops...August will tell the story.
Risk just went up. La Nina could bring hot and dry, but if it brings hurricanes...it will be wet enough to pull out a decent crop.....let the games begin.
07-11-2010 10:26 AM
Mike, with all due respect fly over some of those fields or better yet get off of the superslab and head east southeast in the Wilmington area . A lot of poor and uneven corn and late beans on some prettydecent ground . Thank you.