Floor Talk February 11

[marketeye]

At the close:

The March corn futures contract settled 1 1/2 cents lower at $4.41. The March soybean futures contract finished 9 1/4 cents higher at $13.34. March wheat futures finished 5 1/2 cents higher at $5.90 per bushel. The March soymeal futures contract closed $5.20 per short ton higher at $449.20. The March soyoil futures finished $0.12 higher at $38.85.
In the outside markets, the NYMEX crude oil is $0.15 per barrel lower, the dollar is higher and the Dow Jones Industrials are 208 points higher.

Jack Scoville, PRICE Futures Group vice-president, says the markets started weaker and then firmed up.  
"For soybeans, we keep hearing of Chinese cancellations, but nothing ever shows up.  We heard yesterday that China cancelled 100,000 tons of SBO buys in Brazil, too.  But nothing ever gets confirmed so we bounce.  Basis has generally been weaker, although the Gulf did firm a bit overnight," Scoville says.
Domestic supplies are still pretty tight and farmers are not selling much, so far this week, and that helps the ups side as well, Scoville says.   
Corn is weaker after failing at $4.49 March yesterday.  
"I think we are perhaps seeing a pick up in farmer-selling. Plus, some talk we got to the upper end of the range and hurt the domestic demand and export demand a bit.  Coming back off now to find some buyers."  
Wheat is still trading on a mostly firm note, with ideas of good demand, but with no real conviction even there. Plus, there is some talk we are going to price out of demand if we keep moving higher."
Been a generally boing day here today with buyers and sellers in the cash market not doing much with me, anyway, and even the specs not super interested for me.

Mike

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At mid-session:

The March corn futures contract is trading 2 1/4 cents lower at $4.40. The March soybean futures contract is 6 cents higher at $13.31. March wheat futures are 3 cents higher at $5.87 per bushel. The March soymeal futures contract is trading $4.60 per short ton higher at $448.60. The March soyoil futures are trading $0.04 lower at $38.69.
In the outside markets, the NYMEX crude oil is $0.07 per barrel higher, the dollar is lower and the Dow Jones Industrials are 139 points higher.

It is a quiet day as we unwind yesterday’s report.  Corn lost steam yesterday and following through today," Mike North, Senior Risk Advisor for First Capital Ag.  
Beans are unwinding the larger sell-off that was seen yesterday, he says. "But, any push upward will be capped by large SA production projections and cooperative forecasts."
Wheat is still working its way back from extended sell-offs.

Mike

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At 9:50am:

All farm markets are lower Tuesday. Don't look now, but you can sell soybeans for over $2.00 per bushel more right now than the Nov. 2014 futures contract. Are you considering selling? Or, do you think the new-crop price will come to you?

Mike

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At 8am:

--USDA announces Tuesday that China bought 116,000 tons of U.S. soybeans for 2014-15 delivery.

Mike

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At 5:30am:

--U.S. diesel supplies are the tightest in a decade. Hedge funds are going long. Are you? Have you locked in, or will you lock in, your diesel supplies for this spring anytime soon?

Mike

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At 5am:

--The output for Australia's summer crops could fall 25%. The two crops most affected include grain sorghum and rice, according to the Dow Jones Newswire.

--A National Cotton Council survey indicates U.S. farmers will plant 11.26 million acres of cotton in 2014. That is up 8% from a year ago. Why more cotton? The price is up 7% from a year ago. Will this take some corn and soybean acres away in the South?

--If you think this liquified propane (LP) issue is going away, you might think again. From what I'm being told from an industry expert, the LP industry has priority problems along with infrastructure issues. The U.S. is exporting a large amount of LP out of the Gulf, right now. And yet, there is a huge shortage of LP (running prices on the coast as high as $10 per gallon, and $7 per gallon in the Midwest? On Monday, an Iowa congressman sent a letter to President Obama, asking to stop the exports while the 'shortage' continues. But there is more to this story. And, I'll have a full story for you later.

--Hey, don't get tripped up by this new Farm Bill. There are acronyms galore and hidden deadlines that you should know about. Take a look at Top 9 Need-to-knows from Farm Bill.

Mike

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At 4:50am:

Early calls: Corn is seen 1-2 cents lower, soybeans 2-4 cents lower, and wheat 2-4 cents higher. With the Chinese New Year set to start later this week, the trade is watching to see if China will slow corn and soybean purchases.

Trackers:
Overnight grain, soybean markets=Trading mostly lower.

NYMEX Crude Oil=$0.05 per barrel lower.
Dollar=Lower.

Wall Street=Seen lower, as investors await new Fed Chairman Janet Yellen's first testimony to lawmakers Tuesday. Will she signal whether she supports a slowdown of the central bank's tapering?

World Markets=Asia/Pacific stocks were higher, Europe stocks higher.

More in a minute,

Mike

[farmerguy89]

I had a thread on diesel.

Do you think we are going up? Isn't the seasonal trend for diesel to fall off the cliff in April?

It's hand to mouth as we get out of winter and stop using diesel as heating oil.. Im hoping prices go down. It's very expensive

[jennys_mn]

And I have to wonder where your getting lower today for the Equities? S&P, Dow, Nasdac futures are all higher this morning. Overseas, Japan and Asia are up 1.75% this morning - and all other markets are up also. To me, it looks like we have a strong up day in store.

Jen

[roarintiger1]

Isn't it ironic and only one letter separates the words tapering and tampering?  

[marketeye]

jennys,

Janet Yellen is getting prepared to tell the lawmakers that interest rates should stay low. That news is helping the prospects of the Dow. Earlier this morning, investors had no clue.

Mike

[jennys_mn]

The Feds can't raise rates - well, they could, but it would be a dagger in our economy. Rates will stay low for the foreseeable future. And they need to to help our economy recover. We're not there yet - but we are improving. At some point, rates will have to rise. But not for a while yet.

Jen

[sw363535]

Jen,  rates don't have to rise,  Not if we have entered the "new era" of government dominated economic activity.  I am having a difficult time seeing how the new norm. leaves us.

[Canuck_2]

May not happen overnight but back in the 1930ies people locked in big rates of 1-2% for long terms because they just were not going to ever get any higher.

There were government bonds sold with no ending date just the high rate of 1-2%, great return on their money forever.

[luisvieira]

Here is what I can report from Brazil:

USDA/Conab reports improved perspectives for Brazilian corn growers, says analyst

The USDA report predicted yesterday that Brazil would produce nearly 90 million tons of soybean this crop season and 70 million tons of corn production. Brazil’s National Supply Company today confirmed the same figures for soybeans, but predicted 75.4 million tons for the corn output.

According to Carlos Cogo, a Porto Alegre-based consultant, the USDA report clearly will impact favorably corn growers from Brazil. “The numbers are completely bullish for corn growers. It changes the panorama for corn in Brazil. It is quite different from last year, when there was a record corn crop in the US”, told Cogo to AgroSouth News.

Experts say that there is still a possibility that the estimates for the soybean crop in Brazil might reduce because of recent drier conditions in producing areas like Rio Grande do Sul, Paraná, and Mato Grosso do Sul.

www.agrosouth-news.com

[saturated]

Story from Bloomberg News:

http://www.bloomberg.com/news/2014-02-11/south-american-soybean-harvest-seen-lower-by-oil-world-on-h...