cancel
Showing results for 
Search instead for 
Did you mean: 
Veteran Contributor

Floor Talk January 5

At the close:

At the close, the March corn futures settled 1 1/2¢ higherr at $3.61 1/4, and new crop December 2017 futures finished 1 3/4¢ higher at $3.88 1/4 per bushel. March soybean futures closed 2 3/4¢ lower at $10.12 1/2, while November 2017 soybean futures finished 2 1/2¢ lower at $9.96 1/4. March wheat futures ended 7 3/4¢ higher at $4.26 1/4. March soy meal futures settled $0.90 short ton lower at $318.20. March soy oil futures settled are $0.01 lower at 35.20¢ per pound.  In the outside markets, the Brent crude oil market is $0.55 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 63 points lower at 19,843 points.

 

Mike

----------

At 12:35pm:

Market commentary:

Jason Roose, U.S. Commodities, says that with the January crop report just right around the corner, no surprise to see index fund rebalancing, buying corn,wheat and selling soybeans.
“Flooding in Argentina is a concern on their over all acres. So, weather is still giving us volatility, slow farmer selling on corn is also giving the grains support along with lower crop ratings for winter wheat.”

 

Mike

-------

At 11:15am:

Record amounts of corn is being used on a weekly basis to produce ethanol, according to the Renewable Fuels Association. Here is the latest:

 

According to EIA data analyzed by the Renewable Fuels Association, ethanol production averaged an unprecedented 1.043 million barrels per day (b/d)—or 43.81 million gallons daily. That is up 15,000 b/d from the week before and a record high to end a banner year for ethanol production. Weekly production averaged more than 1 million b/d for ten straight weeks to finish the year. The four-week average for ethanol production stood at a record 1.037 million b/d for an annualized rate of 15.90 billion gallons.

Stocks of ethanol remained unchanged at 18.7 million barrel

 

Mike

-----------

At mid-session:

At mid-session, the March corn futures are 1 3/4¢ higherr at $3.61 1/2, and new crop December 2017 futures are 1 1/2¢ higher at $3.88 1/4 per bushel. March soybean futures are 4 1/4¢ lower at $10.11, while November 2017 soybean futures are 3 3/4¢ lower at $9.95. March wheat futures are 6¢ higher at $4.24 1/2. March soy meal futures are $1.50 short ton lower at $317.60. March soy oil futures are $0.01 lower at 35.20¢ per pound.  In the outside markets, the Brent crude oil market is $0.25 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 98 points lower at 19,843 points.

 

Pete Meyer, PIRA Energy grain analyst, says that the South American weather story is an “easy excuse” for a rally. 
“Losses in Argentina can be somewhat made up, from what I am hearing, a really good Brazilian  crop in the 102-103M MT range.  The failure of President Macri to reduce Argentina’s export tariff from 30% in 2017 is probably the most supportive thing I’ve heard in beans,” Meyer says. 
Brazilian farmers started to harvest some beans as early as two weeks ago. “So, those will be available to the export market in a matter of weeks.  Dollar is off from the highs, but still holding its own which will  make South American origin beans attractive.  I expect a slowdown in bean exports fairly soon,” Meyer says.
 
“Nice rallies in wheat and corn that producers should be taking advantage of in my opinion,” Meyer says.  Prompt corn futures had traded just 7 days above the $3.60 level since July 19th.  Six of those occurrences were in December, while the other time was in late November.  The highest futures price paid during those instances was $3.6475 on December 13th.   Corn is entering an area of high congestion above $3.60.”
So too with wheat above $4.20.  The prompt SRW contract has spent but a handful of trading days above the $4.20 level since August 22nd and failed at or near that $4.20 level no less than 5 times in the same period, Meyer says.

 

 

Mike

-----------

At 9:05am:

In early trading, the March corn futures are unchanged at $3.59, and new crop December 2017 futures are unchanged at $3.86 per bushel. March soybean futures are 4 3/4¢ lower at $10.10, while November 2017 soybean futures are 3 3/4¢ lower at $9.95. March wheat futures are 3 1/2¢ higher at $4.22. March soy meal futures are $1.90 short ton lower at $317.20. March soy oil futures are $0.06 lower at 35.15¢ per pound.  In the outside markets, the Brent crude oil market is $0.43 per barrel higher, the U.S. dollar is lower, and the Dow Jones Industrials are 4 points lower at 19,940 points.

 

 

Mike

---------------

Soybeans were lower overnight while corn and wheat were pretty much unchanged. Beans were down about a nickel amid more rain in parts of Argentina and Brazil. There is now some talk that the rain in Argentina is becoming excessive, but just a couple months ago we heard about how the dry weather was going to kill everything, so I'm not putting too much stock into the `too-much-rain-in-South-America' talk just yet. It may be a problem, but for now I'm skeptical. In other news, the Chinese renminbi just had its biggest two-day jump on record, and that may boost purchasing power for Chinese buyers. Let's hope it translates into strong sales for U.S. growers. 

 

Here's what happened overnight:

 

Brent Crude Oil = 0.8% higher.

West Texas Intermediate Crude Oil = 0.7% higher.

Dollar = down 0.5%.

Wall Street = U.S. stock futures modestly lower in overnight trading.
World Markets = Global stocks mixed amid dollar's decline.

0 Kudos
13 Replies
Honored Advisor

Re: Floor Talk January 5

 What a difference a day makes, yesterday no corn was moved. Today record amounts were used.

 

Even in Ioway the winds don't change as often as the market analysis' s do on this site.

0 Kudos
Veteran Advisor

Re: Floor Talk January 5

with the amount of "moonshine"being made, according to the report....and even more perhaps telling, is that while we had

record amount produced, inventory stayed stable.....so it means we're moving and using......

 

so, the idea of "no movement" needs to be re-thought.........but as usual.....chicago has not a clue......

0 Kudos
Senior Advisor

Re: Floor Talk January 5

Even in Ioway the winds don't change as often as the market analysis' s do on this site.

 

 

Hobby - you haven't seen anything yet - wait till the " Pros" start telling us all about the record bean crop in S.A. that may be in trouble -  - Or not - depends on which  side of the fence they are on . lol

 

Rains and floods on one side --- Burning up on the otherside - And the boy's in D.C. has it pegged as a bin buster - lol 

0 Kudos
Honored Advisor

Re: Floor Talk January 5

 

U.S. Exports of Fuel Ethanol (Thousand Barrels)
 
Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
  2010 324 519 1,153 973 414 387 603 707 929 834 930 1,717
  2011 1,364 1,425 2,003 2,865 1,743 1,604 3,036 1,246 2,525 2,895 3,634 4,117
  2012 1,819 1,785 1,992 1,775 1,397 1,410 1,519 1,206 1,191 1,284 965 1,313
  2013 1,518 1,017 1,312 967 952 796 830 1,182 1,299 1,206 2,134 1,525
  2014 2,091 1,517 2,059 1,659 1,265 1,378 1,599 1,292 1,353 1,949 2,114 1,872
 
  2015 1,640 1,662 2,057 1,761 1,497 1,499 1,716 1,272 1,492 1,792 1,427 1,995
  2016 2,076 1,598 2,270 2,276 1,328 1,108 1,652 1,856 2,373 3,135    

 

 

Somebody's buying it

 

Really need a few more stills, we have the corn, Milo, and wheat as feed stocks.

 

Senior Advisor

Re: Floor Talk January 5

Wonder what the boys will do with all the bean meal ?? With a flood of DDG's - protien around 31 % or so and bean meal at 41 or so - A lot of bean is being replace with the cheapest product = DDG's .

 

Mike - What is the basis on bean meal - it has to be pretty wide - as on the low side .

0 Kudos
Veteran Advisor

Re: Floor Talk January 5

mike...i must disagree with your groups logic on the wheat......

yes, i guess an argument could be made that they have beat the poor horse enough, now they are going to give him some air, so they

can do it again.....

ie, the market has been down, and we've pushed it low enough that the oversold and other indicators are pointing the other way

 

but i also believe part of the cause is crop consditions..........

 

look at my post yesterday or day before, outlining the drop in condtions, and the expanding drought area (new report out jan 4)

 

as for advice of sell sell sell........i don't know if i can go that......with the kind of demend we are seeing  (we are making moonshine

like it's going out of style)....and other countrys....factor in the drop in crop conditions, the expanding drought...and those piles

of wheat aging each day, and quality problems starting to raise their heads........while to make you sleep well at night, to buy a

put.......i believe there is upside potential........

also factor in, much of the wheat was put in "low cost" style.......so i look for lower yeilds, and will be easier to graze it out

or in some instances, tear up and plant something else

 

also, basis SHOULD get better.......BUT.....the local elevators yesterday took 10 cent protection on the wheat and beans.......

((ie basis got even wider))

you would think that at this late in the game, the basis should be getting better...not worse........good way to make money

grains go up, you widen your basis.....

 

funny, grain marketing head no longer comes to church..........

 

 

0 Kudos
Honored Advisor

Re: Floor Talk January 5

elcheapo  points well taken..... and this wheat crop has a lot going against it, no way it will be a big one..... Maybe up the gut of the bread basket  but the west does not look good.... I went to Denver through Garden City and colby KS  and not much good looking wheat seen...  The sub zero temps have burnt off the better wheat.  

The DDG thing hurts wheat.... at least low quality wheat.  The feedlots used pay up to feed it for the extra protein, but not now...  This last few months there have been times when the ddg's were higher priced than wheat, milo, or corn and the DDG's stay in the ration.  They proform well and are liked better than wheat...

 

your right on the wheat condition big area to the sw is not good...  especially if we winter killed some acres.

 

 

Hobby thanks that is a wonderful graffic..... I just don't see E slowing at all..... and I have never bought into the idea that E competes with Oil.  If we produce to the 10% blend rate like now and maintain some exports we may very well be needing some more on line production.

Converting this plant at Hugoton would sure help this area.

0 Kudos
Honored Advisor

Re: Floor Talk January 5

I want to ask this concerning wheat........Who on earth thinks this is a rally in wheat..... It is like that slow breath of air taken by the corpse signalliing the end.  We went up 15 cents making wheat 4.34 KC....... Who on earth is going to sell wheat with a -1.30 basis. putting it at $3.04..... well below corn and its basis.   It is like fueling up the car and driving to the bank because you found a dime.

 

Hobby this kind of fits in with that data..... I have been shocked at the ethanol success... the distillers grain has a lot to do with that. in cattle feed..

 

Eprofit.png

 

Ecin the large amount of bean meal goes to the simple stomached critters....Hogs and birds..... Dairy some... The feedlot cattle used cheaper protein as much as possible.  Guessing a little on that.... but I don't think the volume has been reduced that much.... Maybe Ray or someone else can help on that.

 

Thanks to the folks at FC Stone for help with the prop.

0 Kudos
Honored Advisor

Re: Floor Talk January 5

Tell me this......... Even with the prices the last few years, How many farmers can show a clear profit per bushel that consistantly compares to that chart?

 

at 3+ gallons per bushel that would be averaging around 75 cents profit per bushel...... that is admirable.

0 Kudos