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Tony_Dreibus
Veteran Contributor

Floor Talk June 12 (Report Day)

USDA SAYS:

 

Summary: Corn jumps 5¢, soybeans up 6¢ and wheat up 5¢, following the Report.

 

At mid-session:

At mid-session, the July corn futures are 8 1/2¢ higher at $3.75. December futures 8 1/4¢ higher at $3.96. July soybean futures are 7¢ higher at $9.60 3/4.  November soybean futures are 7 1/4¢ at $9.81. July wheat futures are 13 3/4¢ higher at $5.28. July soy meal futures are $4.40 per short ton higher at $355.60. July soy oil futures are 0.33 lower at 30.25¢ per pound.  In the outside markets, the NYMEX crude oil market is $0.35 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 15 points higher.

 

The USDA pegged then 2017/18 corn ending stocks at 2.102 billion bushels vs. the trade’s expectations of 2.16 billion bushels and USDA’s May estimate of 2.182 billion.

 

The 2017/18 soybean ending stocks are estimated at 505 million bushels vs. the trade’s estimate of 522 million bushels and the USDA’s May estimate of 530 million bushels.

 

The USDA’s 2017/18 wheat ending stocks estimate is 1.08 billion bushels, vs. the average trade estimate of 1.07 billion bushels and the USDA’s May estimate of 1.07 bill. bu.

2018/19 Ending Stocks
For the U.S., the USDA pegged corn ending stocks at 1.577 billion bushels vs. the trade’s expectations of 1.66 billion bushels and the USDA’s May estimate of 1.682 bill. bu.

 

The U.S. soybean ending stocks have been pegged at  385 million bushels vs. the trade’s estimate of 417 million and the USDA’s May estimate of 415 million bushels.

 

The USDA pegged the U.S. wheat ending stocks at 946 million bushels vs. the trade’s expectations of 958 million bushels and the USDA’s May estimate of 955 million.

World Crop Production
USDA pegged the Brazil corn crop at 85.0 million metric tons vs. the trade’s estimate of 84.4 mmt. and the USDA’s May estimate of 87.0 mmt.

 

For soybeans, the USDA sees Brazil’s crop size at  119.0 mmt. vs. the average trade estimate of 117.4 mmt. and the USDA’s May estimate of 117.0 mmt.

 

For Argentina, USDA pegged the corn crop at 33.0 mmt. vs. the USDA’s May estimate of 33.0 mmt. and the trade’s estimate of 32.5 mmt. And, USDA sees Argentina’s soybean production at 37.0 mmt. vs. the trade’s expectation of 37.9 mmt. and the USDA’s May estimate of 39.0 mmt.

 

TRADE REACTION:

--Sal Gilbert, Teucrium owner, says that this report was farmer-friendly.

 

“This was clearly a supportive report for grain prices. U.S. corn ending stocks are projected to decline year-on-year by nearly twenty-five percent, soybean stocks by over twenty three percent, and wheat stocks by about twelve percent. Record April U.S. corn exports and “robust global demand for U.S. corn” are likely to keep a floor under prices from current levels. Farmers have to be happy with this report because the fundamental picture is definitely shifting towards a tighter balance sheet for all the major grains,” Teucrium says.

--Jason Ward, Northstar Commodity grain managing director, says that the USDA reminded the trade that the world balance sheets are tightening in all categories.

 

“Also, these price pullbacks in corn/soy have been largely political as uncertainty surrounds key trade deals. The balance sheets tighten with trend line yields out of the US, so now we need to keep this 2018 crop an above trend line crop (where it currently it is being estimated),” Ward says.
Ward adds, “This report was a reminder that lower prices will not decrease usage as corn/soy usage was increased in both 2017 and 2018 crop years.”

--Jack Scoville, The PRICE Futures Group’s senior market analyst, says that wheat reaction is all about the Russian data.  

 

“3.5 million tons lower month-to-month is a big drop and why wheat is so strong now.  US data was neutral, as far as I am concerned, maybe a bit negative.  Corn is all export demand.”  
Scoville adds, “Brazil and Argentina losing crops in the direction of the trade, but not the magnitude of the expectation.  But the strong export demand was great and the domestic demand next year was too and a great reason to buy.”
The soybean numbers are more neutral, as the crush is up, but not a wild report, Scoville says.  
“Wheat and corn will carry the day with soy the follower, ad this is about the way it should be from my reading of the market,” Scoville says.

---Mike North, President Commodity Risk Management Group, says that today's report would be construed as friendly to the row crops.  

 

“That said, it is actually the wheat market pulling prices higher despite world wheat stocks being 2 and 3 million tons higher than expectations in old crop and new crop respectively,” North says.  
US soybean balance sheets will offer support now that ending stocks dropped to 385 million in the 18/19 marketing year, North says.  
“The reduction in stocks is due to a 25 million bushel increase to crush for 17/18, and a 5 million increase to crush for new crop.  This may, however, hinder soybean meal values as balance sheets are consequently larger,” North says.  
Argentine and Brazilian numbers were in line with expectations.  Corn stocks dropping under 1.6 billion is a mildly helpful to prices, North says.  
“This comes on the heels of an increase to old crop exports and new crop ethanol grind,” North says. .

 

Mike

---------

At the close:

At the close, the July corn futures finished 10 1/4¢ higher at $3.77 1/2. December futures closed 10¢ higher at $3.98 1/4. July soybean futures finished 1/4¢ higher at $9.54.  November soybean futures finished 3/4¢ higher at $9.74 1/2. July wheat futures settled 20¢ higher at $5.34 1/2. July soy meal futures closed $2.30 per short ton higher at $353.50. July soy oil futures ended 0.53 lower at 30.05¢ per pound.  In the outside markets, the NYMEX crude oil market is $0.05 higher, the U.S. dollar is higher, and the Dow Jones Industrials are 55 points lower.

 

Mike

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At the open:

In early trading, the July corn futures are 4¢ higher at $3.71. December futures 3 3/4¢ higher at $3.92. July soybean futures are even at $9.53.  November soybean futures are even at $9.73. July wheat futures are 6 1/4¢ higher at $5.20. July soy meal futures are $1.60 per short ton higher at $352.80. July soy oil futures are 0.34 lower at 30.24¢ per pound.  In the outside markets, the NYMEX crude oil market is $0.24 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 24 points lower.

 

Mike

---------

Soybeans and corn were higher overnight after the USDA lowered its ratings on both crops by 1 percentage point. Beans gained 7 cents, corn was up 3 cents and wheat was up 1-2 cents. The USDA will release its monthly WASDE report at 11am in Washington today, and is expected by analysts to lower its outlook for ending stockpiles for both old-crop corn and beans.  In weather news, it's raining again in central Illinois where flash flood warnings and watches are in effect. Up to 2 inches an hour is expected in the region, according to the National Weather Service. Check out all the details in today's 3 Big Things

 

West Texas Intermediate = down 0.2%.

Brent Crude = down 0.4%

Dollar = unchanged.

Wall Street = U.S. stock higher pre-market.

World Markets = Global stocks mixed overnight.

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15 Replies
roarintiger1
Honored Advisor

Re: Floor Talk June 12 (Report Day)

The carryovers continue to disappear.   The market is very complacent.  Smiley Wink

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roarintiger1
Honored Advisor

Re: Floor Talk June 12 (Report Day)

I just read that the world ending stocks of corn are lower than they were in 2012........and yet our current price is??????      Let that sink in for a moment.  

illinifarmer
Advisor

Re: Floor Talk June 12 (Report Day)

Your underneath the Ball, the object is to get on top of the ball. Lol
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cborman11
Senior Contributor

Re: Floor Talk June 12 (Report Day)

Wow a up day,you traders feeling ok? Oh i'm sure you will find some stupid reason for the rest of the week to knock our prices down
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Hobbyfarmer
Honored Advisor

Re: Floor Talk June 12 (Report Day)

Is this where we call them crooks?
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giolucas
Veteran Advisor

Re: Floor Talk June 12 (Report Day)

Calling out the traders is very easy to do but considering this political climate and the tariffs might sway investors to not buy up the soy market.
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cborman11
Senior Contributor

Re: Floor Talk June 12 (Report Day)

Ha and yet the traders get a paycheck every 2 weeks. Look it up a trader makes a $111k min per yer poor things. They are in for themselves nothing more.
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deasmatt90
Senior Contributor

Re: Floor Talk June 12 (Report Day)

If a trader makes 111k minimum and that upsets anyone then learn what they know, and do as they do!

Odds of trading, control of emotions in the market, preservation of capital, and accumulation and distribution.
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deasmatt90
Senior Contributor

Re: Floor Talk June 12 (Report Day)

Learn support and resistance, and the effects of volume at these areas.
Always buy long at support, or over the break of resistance with volume. never buy in congestion. Anyone hedge long in corn on Monday? 3.69 was the year contract low in September contract. 3.78 support verified yesterday on chart.
Why get angry about commodity prices when we can learn to trade as they do? How much real profit do we make per bushel at the end of the day by producing?

Could we make just as much money as they do playing the game along with them? They (the market makers ) make the rules of the game, to be successful we just have to know what the rules are ( the real rules ).

However I admit this is a lot of risk, these are the best traders there are (futures traders), they are ruthless, precise, and the smartest traders in the free markets. To be profitable they have to be.

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