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Veteran Advisor

Floor Talk August 31, 2020

At the close:

At the close, the Dec. corn futures ended 1 1/2¢ lower at $3.57 3/4. March corn futures settled 1 3/4¢ lower at $3.67 1/2.

Nov. soybean futures settled 3¢ higher at $9.53 1/2. January soybean futures settled 3 1/2¢ higher at $9.59 3/4.

Dec. wheat futures finished 3¢ higher at $5.52 3/4.

Dec. soymeal futures closed $2.80 per short ton higher at $312.50.

Dec. soy oil futures closed $0.38 cent lower at 32.86¢ per pound.



In the outside markets, the NYMEX crude oil market is $0.16 per barrel lower at $42.81. The U.S. dollar is lower, and the Dow Jones Industrials are 218 points lower.

 

Mike

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At 9:50am:

Greg Lumsden, Cargill MarketGuide, says that strength in the ag markets over the last week has been a combination fund repositioning, growing demand, and general lowering of yield estimates by analysts.

“The rally is particularly impressive as this is a seasonally weak timeframe and is usually coupled with forced farmer selling at the end of August. In spite of these trends the funds have begun to aggressively cover their short positions and effectively exchange positions with farmers who have been selling," Lumsden says.

The main catalyst for this rally is perceived lower production than we were looking at a few weeks ago, he says.
"Most analyst heavily weight condition score models and they have dropped sharply over the last few weeks. Throw in storm damage in IA and a dry forecast to finish the crop and most yield estimates have gone from 178-182+ to 175-178 with a downward bias. The market is also taking notice of very strong Chinese demand which will also eat into our ending stocks numbers," Lumsden says.

Lumsden added, "All-in-all, we certainly aren’t in a “tight” situation but the ending stocks picture just got more interesting and will bring in more risk premium for South America’s growing season and our planting in the spring. Renewed volatility in ag markets and general belief that basis will be firm this winter/spring should bring more opportunities than our farmers have seen in a while. For farmers, the key will be to maintain discipline and take advantage of rallies and not get blinded by new friendly market inputs."

At 8:45am:

 

Farm markets to end the month with a bang.

 

See Monday's markets here.

 

 

Thanks,

 

Mike

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Advisor

Re: Floor Talk August 31, 2020

I can’t find the numbers for the crop conditions report today?  Did they not come out or just are not being mentioned?  I do see that the traders had no trouble evaporating the rally from the open.  Curious why the values didn’t hold longer than an hour or so.

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Honored Advisor

Today's massive rain event...

.09" and it is a little stretch to not just call it .08" BIGGEST rain event in over a month of 90+ heat indices.

The sun is back out and a nice drying breeze... woo hoo

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Advisor

Re: Floor Talk August 31, 2020

We have "perceived" lower production when we have actual weather problems but a bigger crop would already be in the bin if rain was forecast ten days out.  Speaking of being in the bin, a lot of the pictures of bin damage in Iowa and Illinois looks like not all as full of corn as USDA says. 

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Veteran Advisor

Re: Floor Talk August 31, 2020

They come out at 3:00pm.

 

Mike

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Re: Floor Talk August 31, 2020

Thanks, hopefully tomorrow they’ll figure out a way to hold the price jump.  Optimism it’s all some of us have left.

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Honored Advisor

Somebody's smokin their socks

If they think FC Stones number for Iowa is the final answer on this years yields.

Must be like USDA failed planted acres don't count? Did they just uncount all the wind flattened corn acres?

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Honored Advisor

Re: Floor Talk August 31, 2020

The 2% G/E ratings probably was Polly Anna. They`re calling 8.5 m acres derecho damage 5m corn 3.5m beans, before wasn`t guesses north of 10 million acres?   It`ll all come out in the warsh.

https://www.youtube.com/watch?v=Ka7gRrEy0JM

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