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marketeye
Veteran Advisor

Floor Talk November 10 (Report Day)

USDA SAYS:

 

Corn:

Yield= 169.3 bu./acre vs. the traxde's estimate of 168 bu./acre

Acres= 80.7 million vs. the trade's estimate of 80.7 million

Production= 13.654 billion bushels vs. the trade's expectation of 13.55 billion bushels

 

 

Soybeans:

Yield= 48.3 bu./acre vs. the trade's estimate of 47.5 bu./acre

Acres= 82.4 million vs. the trade's expectations of 82.4 million

Production=  3.981 billion bushels vs. the trade's expectations of 3.912 billion

 

As a result, the corn market has fallen 8 cents, soybeans down 14 cents, and wheat is down 1 cent.

 

U.S. 2015-16 Carryout:

Corn=1.76 billion bushels, vs. the trade's expectation of 1.587 billion and the USDA's Oct. est. of 1.561 billion.

Soybeans= 465 million bushels, compared with the trade's expectations of 429 mill. and USDA's Oct. 425 mill.

Wheat=  911 million bushels vs. the trade's expectation of 866 mill. and USDA's Oct. 861 million bushels.

 

 

 

TRADE REACTION:

--—-Mike North, President Commodity Risk Management Group, says that large supplies is the best way to describe the newly updated balance sheet.  “Corn yield was raised to 169.3, above the average guess of 167.4 bu/acre.  Soybean yields jumped to a new all-time record of 48.3 bpa.  These production hikes in conjunction with smaller corn usage numbers (ethanol down 75 million bu, exports down 50 mil. bu, feed usage up 25 mil. bu) allowed balance sheets to climb both domestically and globally.  Current projected stocks for the 2015/16 marketing year are 1.76 billion bushels of corn and 465 million bushels of soybeans. Globally, corn supplies rose to 211.91 MMT from 187.8 MMT after accounting for the growth in US production and the reduction in the Chinese usage of corn for feed.  Soybeans parted company here.  Stocks declined by 2.2 MMT on stronger projected Chinese demand.”

 

--Sal Gilbertie, Teucrium Trading, says that while total stocks and production of wheat are at record or near record levels, total world usage of wheat is raised by one million tons, mostly reflecting increased consumption by China. Higher global stocks for corn, also led by China, seem to be migrating corn prices to at or below their cost of production, coinciding with the seasonal harvest low cycles, which could provide a good buying opportunity for buy-and-hold investors. Record yield per acre in soybeans is also pushing soybean prices to the limits of farmer profitability, which also may provide medium and long term agricultural investors with investment opportunities in the sector.


--Jacob Burks, Wedbush Futures LLC, says that this bearish report was expected and the USDA didn’t disappoint.  “Corn, Soybeans, and wheat all received boost in ending stocks numbers.  I guess the answer is yes, the Western Corn Belt can support the losses in the east."


--Pete Meyer, PIRA Energy Senior Grain Analyst, says that the ending stocks numbers, across the board, were higher than expected. 
“In short, it’s all up to the export market to get this market turned around and with CONAB posting 102M MT in soybean production this morning, to go along with almost 82M MT in corn, the odds are stacked against US exports, especially with the Dollar Index approaching 100.  Going to be a long, nervous wait for farmers until the January reports.”

 

--Corey Bratland, Kluis Commodities: "This report keeps the farmers on the sidelines even longer. Short-term, the basis market may improve."

 

Mike

--------

At the close:

At the close, the Dec. corn futures setled 7 3/4 cents lower at $3.59.  Nov. soybean futures closed 9 cents lower at $8.64 1/2.
 Dec. wheat futures finished 11 cents lower at $4.90 3/4. 
Dec. soymeal futures ended $2.80 per short ton lower at $292.20. Dec. soyoil futures closed $0.50 lower at $27.27.  
In the outside markets, the Crude oil market is $0.54 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 3 points lower.

 

Mike

--------

At mid-day:

At mid-day, the Dec. corn futures are trading 7 cents lower at $3.59 3/4.  Nov. soybean futures are trading 13 1/4 cents lower at $8.60.
Dec. wheat futures are trading 10 1/2 cents lower at $4.91 1/4. 
Dec. soymeal futures are $4.40 per short ton lower at $290.60. Dec. soyoil futures are trading $0.60 lower at $27.17.  
In the outside markets, the Crude oil market is $0.63 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 29 points lower.

 

What do you think about the USDA numbers and today's trading action?

 

Mike

-------

At 11:45am:

Egypt bought 115,000 metric tons of wheat Tuesday. But, none of it is U.S.-origin. Russia and Ukraine wheat was purchased.

 

Mike

-------

At 10:30am:

At 10:25am, the Dec. corn futures are trading 2 3/4 cents lower at $3.64.  Nov. soybean futures are trading 4 1/4 cents lower at $8.69.
Dec. wheat futures are trading 7 1/2 cents lower at $4.94.
Dec. soymeal futures are $1.80 per short ton lower at $293.20. Dec. soyoil futures are trading $0.26 lower at $27.51.  
In the outside markets, the Crude oil market is $0.42 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 55 points lower.

 

 

Mike

-----------

At 10:25am:

Tom White, FuturesRoad.net and CME Group corn trader offers up these pre-USDA comments:

 

"We broke a daily trendline on Nov 5th at 377 1/2 with a possible objective down to 349 1/2 . So staying under that 377-378 area is key. All moving averages and channels are basing lower, so the bias is to continue lower at least for now unless we get strong Bull numbers from WASDE. Previous low was 357 1/2 on August 12th so their could be some initial support in that area at first But Daily trend line break objective would be down at 349 1/2," White says.

 

Mike

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7 Replies
giolucas
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

Mike,

 

thanks for joining the few that are on here.  Even you are posting less  and less.  

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marketeye
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

giolucas,

 

I hope that folks still find the information useful. Right now, it's my feeling that we should be talking more not less, regarding how to ride out this low-priced market environment. And, in just a few short days, farmers around the U.S. will be getting our Mid-November Successful Farming magazine in their mailboxes. All 30-plus editorial pages focus on what farmers can do to #stayfarming. Real, utilitarian methods to implement or tweak into their grain marketing and risk management plans, on their farms.

 

Mike

 

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roarintiger1
Honored Advisor

Re: Floor Talk November 10 (Report Day)

Bullish news would be useful......The other kind, not so much.  But there seems to be a tidal wave of that other kind of news.    Time is running out for many farmers to right the ship.

FWIW, If the farmers don't make much money, none of the suppliers are gonna make much either.   Trickle down economics in reverse.

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marketeye
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

Big numbers for U.S. production, and bigger U.S. carryouts. The market is falling further, as a result.

 

What do you think?

 

Mike

 

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giolucas
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

Market is not collapsing .  Although numbers are bigger it seems like we are oversold. 

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marketeye
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

At 11:30am:

 

No collapse,but trending convincingly lower. Corn is down 6¢, soybeans are off 11¢, and wheat has dropped 13 cents.

 

Mike

 

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giolucas
Veteran Advisor

Re: Floor Talk November 10 (Report Day)

Yep, these are buy and hold prices.  HOLD for awhile. 

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