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Tony_Dreibus
Veteran Contributor

Floor Talk August 18

At the close:

 

At the close, the Sep. corn futures settled 1 3/4¢ higher at $3.32, while Dec. futures closed 2 1/4¢ higher at $3.42 per bushel. Sep. soybean futures ended 1 3/4¢ higher at $10.32, while Nov. soybean futures closed 1 1/2¢ lower at $10.14 1/2. Sept. wheat futures finished 1¢ higher at $4.27. Sep. soymeal futures finished $2.30 short ton lower at $334.40. Sept. soyoil futures closed $0.18 higher at 34.19¢ per pound.  In the outside markets, the Brent crude oil market is $1.54 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 4 points lower.

 

Mike

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At mid-session:

 

At mid-session, the Sep. corn futures are 1¢ lower at $3.29, while Dec. futures are 3/4¢ lower at $3.39 per bushel. Sep. soybean futures are 3/4¢ higher at $10.31, while Nov. soybean futures are 1 1/4¢ lower at $10.14. Sept. wheat futures are 1/2¢ higher at $4.26. Sep. soymeal futures are $0.40 short ton lower at $336.30. Sept. soyoil futures are $0.17 lower at 33.84¢ per pound.  In the outside markets, the Brent crude oil market is $1.32 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 21 points lower.

 

Mike

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At 9:25am:

If you missed it, the USDA Weekly Export Sales Report shows corn beat and soybeans at the top of expectations.

 

Wheat= 489,500 metric tons vs. the trade’s expectations of 400,000-625,000 mt

Corn= 1.709 mmt. vs. the trade’s expectations of 850,000-1,500,000 mt.

Soybean= 1.767 million mt. vs. the trade’s expectations of 1,200,000-2,600,000 mt.

 

 

Mike

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At 9am:

If you missed it, the USDA announced more fresh corn sales Thursday.

 

Private exporters reported to the U.S. Department of Agriculture export sales of 101,600 metric tons of corn for delivery to unknown destinations during the 2016/2017 marketing year.

The marketing year for corn began Sept. 1.

 

Mike

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At the open:

 

At the open, the Sep. corn futures are 2¢ lower at $3.28, while Dec. futures are 1 3/4¢ lower at $3.38 per bushel. Sep. soybean futures are 10 1/2¢ lower at $10.20, while Nov. soybean futures are 12 1/4¢ lower at $10.03. Sept. wheat futures are 2 1/4¢ lower at $4.23. Sep. soymeal futures are $4.40 short ton lower at $332.30. Sept. soyoil futures are $0.33 lower at 33.68¢ per pound.  In the outside markets, the Brent crude oil market is $0.69 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 16 points lower.

 

Mike

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Soybeans were sharply lower overnight as if traders woke up in a cold sweat and said `Did the USDA say a record crop last week!?' It's possible, I guess, that soybean prices got a bit too big for their britches because demand sure hasn't tapered off -- in fact the USDA yesterday reported not one, but two bean sales. One was to China for 381,000 metric tons and one to unknown buyers for 129,000 metric tons. The dollar is again lower this morning, which is generally bullish crops, so the sudden realization that we're going to have a big crop is somewhat baffling. 

 

In other news, the Fed said in the minutes from its July meeting that it's still waiting to see if it should raise interest rates or not. A couple of Fed members earlier this week had said they believe the time is right for a rate hike, which could have an effect on loans for large-ticket items such as land and heavy equipment. 

 

Here's what happened overnight:

 

Brent Crude Oil = 0.3% lower.
West Texas Intermediate Crude Oil = 0.3% higher.

Dollar = down 0.4%.

Wall Street = U.S. stock futures slightly higher in overnight trading.
World Markets = Global stocks rise on weaker dollar. 

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16 Replies
timetippingpt
Honored Advisor

Re: Floor Talk August 18

Tony...a little less emotion maybe?

"sharply lower"??   Beans being down 11 is not sharply lower. Sharply is more like down 25 or 30. 

jmo  have a nice day.

 

btw...beans are certainly overvalued, and we probably could be down 30 by the end of the day. 🙂

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Hobbyfarmer
Honored Advisor

Re: Floor Talk August 18

Beans are "overvalued"?

 

U priced anything new lately? 

 

U been to the ag parts counter lately?

 

On top of that there is only one " store" on the planet with any inventory on the shelves.

 

Farming with a "calico fleet" I have been to the CNH, AGCO, & John Deere parts counter, three different in competition businesses. Problem is they are competing to see who can charge the mostest for the leastest.

 

New 1/2 ton pickups easily get their sticker prices over $50,000. And $9.50 cash beans are overvalued?

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roarintiger1
Honored Advisor

Re: Floor Talk August 18

Soybeans are NOT overvalued..............

What have you been smokin'?  

ECIN
Senior Advisor

Re: Floor Talk August 18

Here's the problem Hobby ole buddy - were just to dam good at what we do ! prices go down so what do most do ? We shot for the moon to raise "more " to off set the lower prices and that just digs the hole deeper - I admit - I do it to -  Maybe we ( all farmers ) should just go one year without any 28 or 82 .

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Hobbyfarmer
Honored Advisor

Re: Floor Talk August 18

Time I know you are using the corn bean ratio. Problem as I see it you started at the wrong end.

 

Corn in most of the corn belt is under $3  

 

I don't know any producer that likes that number. I best guess is that most but not all are in the red at these prices.

 

Beans aren't overpriced ...Corn is extremely under valued/priced.

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timetippingpt
Honored Advisor

Re: Floor Talk August 18

Sorry to offend gents, I was just merely stating the facts.

 

We monitor % of the range of this century.

Beans @ 45% of the range

Corn @ 25% of the range

Wheat @ 19% of the range

Hogs @ 25% of the range

Crude Oil @ 27% of the range (back up from 12.5% of the range)

The list is endless...

 

by any measure, beans are over-valued.

Your cost of production has basically nothing to do with the valuation facts.

 

Another way to look at it, if you grow beans that are 10% over average that is 110% of bushels

Multiplied by $10 gets you roughly an $11 bean sale. Thus they are even more over-valued

than the basic price shows.

Same thing on corn, If you are in an area with yields 10% above normal, then 3.30 corn is actually 3.60. Not good, but with selling the carry adding another 30 cents to it, you can get close to roughly $4 corn out the door.  Add in the ARC payment, and it isn't nearly as bad as it feels. 🙂

 

just one way of looking at it....

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Hobbyfarmer
Honored Advisor

Re: Floor Talk August 18

Cop does make a difference, need to spend time above it IF a reliable supply is to be reasonably assumed.

 

I'm not sure losing 50% of the producers in the next three years at the rate many are hemorrhaging cash and equity is going to lead to more production.

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sw363535
Honored Advisor

Re: Floor Talk August 18

See Tony, even the best can make that mistake.....  🙂

 

 

I have never seen a marketing adviser admit that a commodity has buying power.  And yet every producer knows how many bushels of whatever it takes to make a payment on anything... 🙂

 

Your cost of production has basically nothing to do with the valuation facts.      Assuming there is flexability in the economy over time.  ......maybe.

I think this statement comes with an assumption that prices of everything are flexable.... 

 

 

Ask a broom corn producer about that, or any implement dealer these days.  Our local Dodge Truck dealer says he has been in the red for 22 months with the wreck of oil and commodity prices... When asked when the price on trucks will come down.

I should have tried that statement on him..... Your cost of production has basically nothing to do with the valuation facts.

 

 

Time is not inaccurate on a short time frame,  just has a poor choice of words, because ultimately the cost of production does limit supply and availability.   

So much that governments will do crazy things to keep production happening...... Or producers will change their business practices. 

My part of the midwest has seen major crop production changes at least 4 times in the last century due to "valuation factors".  And I can think of a couple more.

Even the cornbelt has made at least one major change in Production due to commodity valuation in that time period.  From livestock and dairy to cash grain...

Who invests in Brazil if valuation factors don't allow for profit.  And how does profit happen without the influence of COP??

 

 

 

 

 

 

 

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sw363535
Honored Advisor

Re: Floor Talk August 18

Your cost of production has basically nothing to do with the valuation facts

 

It just sounds better than "Take a loss and like it, sucker" -- similar meanings

and it comes across as "we don't care what you are worried about"

 

But we already know in the short term we will take it...as we begin the change..... we all know it will change eventually, one way or another.

 

The other end of this is when a commodity buyer complains when a producer won't sell at a highly profitable price....

 

Sometimes we just don't see it from someone elses eyes.......

 

 

 

 

 

 

 

 

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