Floor Talk, June 17, 2019
After the close:
USDA Crop Progress Report shows that 7.0 million corn acres and 180. million bean acres remain unplanted. See the full report at:
At the close:
At the close, the July corn futures finished 1 3/4¢ higher at $4.54 3/4. Dec. corn futures ended 5¢ higher at $4.68 1/2.
July soybean futures settled 16¢ higher at $9.12 3/4. November soybean futures closed 16¢ higher at $9.39 1/2.
July wheat futures ended 1¢ higher at $5.39 1/2.
July soymeal futures closed $0.80 per short ton higher at $324.30. July soy oil futures settled $0.53 higher at 28.14¢ per pound.
In the outside markets, the NYMEX crude oil market is $0.41 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 57 points higher.
Britt O'Connell, Cash Advisor for Commodity Risk Management Group, says that the markets are offering selling opportunities for farmers.
“Corn is finding continued strength, as buyers have been flooding to the market. Funds have moved from their massive short position that took July corn as low at $3.43 to a net long positive of approximately 130,000 contracts. This has moved the July contract over a $1 higher. The funds typically can move to a long position of 200-250k contracts without much effort. Certainly this year is one where they could also push the envelope on the long side. Interestingly enough this market has also moved into a 'shortage' mindset and we've seen spreads narrow in the 2019/2020 marketing year. I would suggest that this market still has some gas left in the tank for higher ground. It almost seems predestined for trying to ink a $5,” O’Connell says.
He added, “Beans are simply borrowing strength from corn. Lots of risk left in that market. We tested the $9.40 resistance this morning and have stepped back a bit since then. Should we get confirmation that the bean crop is planted this market is prone to step back and see that corn:bean ratio widen,” O’Connell says.
In early trading, the July corn futures are 3 3/4¢ higher at $4.56. Dec. corn futures are 4 3/4¢ higher at $4.68.
July soybean futures are 12¢ higher at $9.08 3/4. November soybean futures are 12¢ higher at $9.35 1/4.
July wheat futures are 4 3/4¢ higher at $5.43 1/2.
July soymeal futures are $1.10 per short ton higher at $324.60. July soy oil futures are $0.40 higher at 28.01¢ per pound.
In the outside markets, the NYMEX crude oil market is $0.49 lower, the U.S. dollar is lower, and the Dow Jones Industrials are 6 points higher.
Al Kluis, Kluis Advisors, says that the fund investors caught short this market may be now pushing it up.
“The way July CBOT corn is gaining on the rest of the contract shows how many funds were caught short the July call options. This sets up some extreme volatility into the close of the July corn option trading on Friday June 21. Stay tuned,” Kluis told customers in a daily note.
Kluis added, “Watch the spread between July and December 2019 corn. In early May, the December contract was trading 20 cents higher than the July contract. But Friday, it was only 10.5 cents over. With this squeeze in the July Corn options, I expect the July contract to go possibly go to a premium to the December corn this week.”
Re: Floor Talk, June 17, 2019
It's June 17th......There are 17-18 million acres of soybeans left to plant. The production on those acres just about equals USDA's predicted carryover. It appears that Mother Nature has taken care of our over supply.
When traders can't see any more profit in buying corn, they will be coming for the soybeans.....FWIW, the smart money already is.
It would not surprise me at all to learn in the coming weeks that China has purchased a large quantity of our soybeans.