Floor Talk March 7

[marketeye]

At 7:15am:

Ukraine's February grain exports hit an all-time high of 2.3 million metric tons, according to its Ag Minister. Of that total, 2.0 million metric tons were corn exports.

Monday's USDA/WASDE Report, let's talk about it. The trade sees:

--Lower South American soy and corn crops.
--Lower U.S. corn and soybean ending stocks.

--A 50 million bushel rise in corn exports.

--A 25 million bushel increase for soybean exports.

--An a lowering of soybean crush.

How do you see it?

Thanks,

Mike

----------

At the close:

The May corn futures contract settled 3 3/4 cents lower at $4.87. The May soybean futures contract finished 22 cents higher at $14.60. May wheat futures finished 7 1/2 cents higher at $6.53 per bushel. The May soymeal futures contract closed $7.10 per short ton higher at $458.00. The May soyoil futures finished $0.13 lower at $44.36.
In the outside markets, the ICE Brent crude oil is $1.01 per barrel higher, the dollar is lower and the Dow Jones Industrials are 5 points lower.

One analyst says the markets lost steam Friday due to the large report on Monday. Profit-taking before that report, as well as heavy producer selling on $5.00 corn futures.  Also Oats are limit down on Canada announcement:

07-Mar-2014 11:11 - CBOT MAY OATS OK4 DOWN 20-CENT DAILY LIMIT AT $4.46-1/4 AFTER CANADA ANNOUNCES PLAN TO ORDER RAILROADS TO MOVE GRAIN - TRADE

Mike

---------

At mid-session:

The May corn futures contract is trading 1 3/4 cents lower at $4.89. The May soybean futures contract is 7 1/4 cents higher at $14.45. May wheat futures are 6 1/2 cents higher at $6.52 per bushel. The May soymeal futures contract is trading $1.10per short ton higher at $452.00. The May soyoil futures are trading $0.15 lower at $44.34.
In the outside markets, the ICE Brent crude oil is $0.96 per barrel higher, the dollar is higher and the Dow Jones Industrials are 67 points higher.

Mike

-------

At the open:

The May corn futures contract is trading 3 cents higher at $4.94. The May soybean futures contract is 15 cents higher at $14.53. May wheat futures are 10 cents higher at $6.56 per bushel. The May soymeal futures contract is trading $6.70 per short ton higher at $457.60. The May soyoil futures are trading $0.16 higher at $44.65.
In the outside markets, the ICE Brent crude oil is $0.53 per barrel higher, the dollar is lower and the Dow Jones Industrials are 56 points higher.

Mike

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

At 7:00am:

Early calls: Corn is seen 9-10 cents higher, soybeans 16-18 cents higher, and wheat 13-15 cents higher.

Trackers:
Overnight grain, soybean markets=Trading higher.

ICE Brent Crude Oil=$0.17 per barrel higher.
Dollar=Lower.

Wall Street=Seen flat, ahead of U.S. Employment Report Friday.

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

More in a minute,

Mike

[roarintiger1]

I see it as most of this is old news. I think that if there are any surprises, it will be on the bearish side. It's really a shame that corn & soybeans have been undervalued for the last few months. And, while trading Monday's numbers may last a few days, attention will be soon shifted to acres and mostly, the weather.

The USDA has again done their job in stabilizing the market prices with their predictions. The question remains......have they done everyone a disservice by keeping the grain prices too cheap.....for too long?

[sw363535]

bean exports need to rise 100m just to be even with current activity.

Shhhh mike you woke the market.

[sw363535]

Yes those long term projjjjjections may have created another drought like finish to 2013 crop year.

Someone needs to post another chorus of the song "Record crops lead to oversurplus"

Roaringtiger-1,  The reason they keep playing that song is because politically they don't want to here the new song "Ethanol leads to higher food prices"

Think what demand would be like if we actually had a good size cow herd.  Saw last week that cow #s were down so far they matched a year in the early 1950's.

[giolucas]

As things lead up to Monday, I see info leaning quite bullish.  That scares me because when things are too bullish then that is when the market takes the price the opposite way.

[sw363535]

Yes I agree -------- I hate to complain, but we were getting the nice steady trend recovery we needed and should have gotten a report to keep that correction going.  we would have built a nice long market correction with big building blocks of exports and useage well into summer.  And at least in my mind, we would be coming to a solid reality that we have a healthy production side and a very healthy demand side-- along with a good system of price discovery.

 Now this Ukraine thing comes along and distorts reality.  We are having a talking head "holly cow" moment and may loose stability in the reactionary response to it all.  Further supporting the pundent's view that "this isn't right, surplus is normal and we will be back there in a few days".  The absolute lie that many producers believe.

We have built and enjoyed strond demand for grains that is record breaking in a far more remarkable level than production increases. The hired "experts" are trying very hard not to talk about that.  They spent the winter "wowing" the producers with those production numbers and projections of record supply.

What category of demand stopped buying in 2012 when the supply dropped and the price raced up?  None.  Sales were reduced, but demand never stopped.  I find that to be as remarkable as the drought itself. 

If you wonder which way the market is headed,  try to figure out which side is trying most desperately to influence the market, the bull or the bear.

It is hard to be a contrarian when the market is on a long slide correction, some of which was needed.  But seriously,  who predicts another $2 drop at the end of a $2 drop(65% price reduction) knowing that price will stop a high % of production. ------ The answer could be someone who is having a hard time getting grain bought, or someone who fears the potential of the market, or someone who doesn't know how to revise the variables in the historic computer model.

[crophugger]

E always seems to be the whipping child I'll say it again E has to be one of the best things that ever happened for my farm and the local economy grain livestock producer here. Shouldn't let those algo traders depict our prices but I love the volatility gotta have a plan.

[sw363535]

totally agree

One of the biggest "bad" assumptions now is that ethanol needs minimum standards or government support.  Getting it started -- yes. But it ran past that a while back.