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Veteran Advisor

Floor Talk February 27

At the close:

At the close, the May corn futures settled 4 3/4 cents higher at $3.93 3/4 per bushel. The new crop Dec. corn futures finished 3 3/4 cents higher at $4.17 1/2.
May soybean futures ended 5 1/4 cents higher at $10.31 3/4. The new-crop Nov. soybean futures closed unchanged at $9.97.

The May soybean meal futures settled $1.70 per short ton lower at $342.40. The May soyoil futures finished $0.91 higher at $32.95.

May wheat futures finished 12 1/2 cents higher to $5.13.

In the outside markets, the NYMEX crude oil market is $1.48 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 69 points lower.

Mike North, President Commodity Risk Management Group, says the markets are closing out the week and month with traditional technical style. 

"Shorts are being caught in the soybean market as the truck workers strike drags on and slows dumping at ports, complicating harvest logistics and impairing export of product.  The wheat market is moving along the same lines with short covering driving the move higher.  Corn is being drug along in the process.  The lack of fundamental information creates a potential set up for a Monday sell-off."

CROP INSURANCE RATES

Also, the crop insurance price rates are set off of the February futures. Crop insurance prices will likely be $4.15 and $9.72 for corn and soybeans respectively, North says.

Yet another analyst weighed in with his thoughts on this year's crop insurance rates.

He says, "I had a conversation with about 10 farmers today asking them based on these figures what one looks more attractive and the answers were consistent, NEITHER!!!
 
Some guys have even talked about scrapping crop insurance all together because the guarantee will be a loss."

 

Mike

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At mid-session:

At mid-session, the May corn futures are trading 3 1/2 cents higher at $3.92 per bushel. the new crop Dec. corn futures are trading 2 3/4 cents higher at $4.16 1/2.
May soybean futures are trading 6 1/4 cents higher at $10.32. The new-crop Nov. soybean futures are 2 1/4 cents higher at $9.99.

The May soybean meal futures are trading $1.60 per short ton lower at $342.50. The May soyoil futures are trading $1.01 higher at $33.05.

May wheat futures are trading 10 1/4 cents higher to $5.10.

In the outside markets, the NYMEX crude oil market is $0.80 higher per barrel, the U.S. dollar is unchanged, and the Dow Jones Industrials are 15 points lower.

 

Jason Ward, Northstar Commodity Director of Grains and Energy, says market factors that continue to be supportive are the short-covering in wheat following the technical reversal yesterday.

"It is absolutely amazing how negative corn can be when wheat is anchoring it to the downside. I call wheat the cinder block of the grain complex, but the trade action yesterday is worth noting. We made new lows for the year taking out the $4.92 ¼ Chicago low and we bounced considerably. We are now 21 ¾ cents off yesterday’s low in wheat, and based on the corn/wheat spread that equates to at least 10-cents/bushel in corn. We saw the corn/wheat spread trade to $1.05 yesterday, a level many would consider to be a good value to own wheat against corn. The previous low was $1.17/bushel wheat over corn."
 
He adds, "So, I'm calling the corn support a reflection of the short covering bounce in the wheat."
 
Regarding soybeans, the Brazil trucker's strike is underpinning this market. Also, remember, trend following funds are short beans (and wishing they weren’t) and I think their buying is where the constant daily support is coming from."

 

Mike

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At 10:10am:

A tight Brazilian source is telling me that he sees the Brazilian trucker strike ending this weekend. I asked him what he bases his opinion on. And he says, "Ongoing negotiations between the government and truck drivers. And, because truckers are tired and need money. They are stopped and have no income."

So, it sounds like the truckers will blink.

Mike

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At 10am:

At 10am, the May corn futures are trading 1 3/4 cents higher at $3.90 per bushel. the new crop Dec. corn futures are trading 1 1/2 cents higher at $4.15.
May soybean futures are trading 4 3/4 cents higher at $10.31. The new-crop Nov. soybean futures are unchanged at $9.97.

The May soybean meal futures are trading $2.30 per short ton lower at $341.80. The May soyoil futures are trading $0.86 higher at $32.90.

May wheat futures are trading 7 1/4 cents higher to $5.07.

In the outside markets, the Brent crude oil market is $0.71 higher per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 20 points lower.

 

Mike

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At the open:

At the open, the May corn futures are trading 1/2 of a cent lower at $3.88 per bushel. the new crop Dec. corn futures are trading 3/4 of a cent lower at $4.13.
May soybean futures are trading 3/4 of a cent lower at $10.25. The new-crop Nov. soybean futures are 5 cents lower at $9.92.

The May soybean meal futures are trading $2.90 per short ton lower at $341.20. The May soyoil futures are trading $0.51 higher at $32.53.

May wheat futures are trading 2 1/2 cents higher to $5.03.

In the outside markets, the Brent crude oil market is $1.23 higher per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 17 points lower.

 

Mike

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At 8:20am:

BRAZIL STRIKE UPDATE:

--Nothing new to report, this morning. The strike is ongoing. Here's some other crop news:

Brazilian analysts Agroconsult estimated the soybean crop growing and being harvested right now at 94.7 million metric tons, up 828,000 tons from its January estimate. Agroconsult sees Brazil's corn output at 79 mmt, (29 mmt represents the first corn crop, 50 mmt the safrihna, or second crop).
Argentina‘s Ag Ministry estimated the country's soybean harvest at 58.0 mmt,  corn at 30.0 mmt.

Agriculture.com's Brazilian Source Response To Estimates:
"We've been listening daily to farmers and farmers associations and they don't believe in the estimates. Our harvest is late. Well that's what is believed by many.
About Argentina, I agree with the estimates. The crops are doing good down there. But, their crop is also late. "
In Paraguai, they'll lose about 1 mmt and harvest around 8 mmt."


World Crop Estimates:

The International Grains Council sees the 2015/16 global corn crop at 938 million tonnes, down 54 mmt from last year (-5%), but still the third-largest harvest on record. World wheat output was pegged at 705 MMT in ‗15/16, down 14 mmt from last season (-2%), with that 719 mmt figure coming in 2 MMT higher this month, mostly due to an increase in Argentina.

 

Mike

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At 8am:

On Friday, private exporters reported to the U.S. Department of Agriculture the following activity:

  • Export sales of 140,000 metric tons of corn for delivery to Saudi Arabia during the 2014/2015 marketing year; and
  • Export sales of 120,000 metric tons of grain sorghum for delivery to China.  Of the total, 60,000 metric tons is for delivery during the 2014/2015 marketing year and 60,000 metric tons is for delivery during the 2015/2016 marketing year. 

The marketing year for corn and grain sorghum began Sept. 1.

 

Mike

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At 7:25am:

 

Early calls: Corn 2-4 cents higher, soybeans 8-10 cents higher, and wheat 6-8 cents higher.

 

Trackers:
Overnight grain, soybean markets = Trading higher.
Brent Crude Oil = $0.99 higher.
Dollar =Lower. 
Wall Street = Seen lower, as the U.S. 4th Quarter GDP is set to be announced today. 

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

 

 

 

More in a minute,

 

Mike

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