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Veteran Advisor

Floor Talk October 16

At the close:

The Dec. corn futures contract settled 3/4 of a cent lower at $4.42. The Nov. soybean futures contract settled 9 1/2 cents higher at $12.76. Dec. wheat futures closed 4 cents lower at $6.81 per bushel. The Dec. soymeal futures contract ended  $1.40 per short ton higher at $403.80. The Dec. soyoil futures closed $0.71 higher at $41.37. 


In the outside markets, the NYMEX crude oil is $0.44 per barrel higher, the dollar is lower and the Dow Jones Industrials are 161 points higher.

 

One analyst sees the market this way:  "Today’s action is much like that of recent days, void of information and forced to trade charts and harvest news.  With the recent rain system moving through the Midwest, end-users have raised their bids for corn and soybeans ever so slightly to incentivize producers to put wheels under what has come out of the field.  Together with some supportive technical, corn and soybean prices have been able to show some signs of life.  These are rallies worth selling though, as future harvest progress will begin to fill up available storage capacity and weaken cash bids."

 

 

Yet another analyst sizes up today's market action like this:  "Without USDA numbers to guide the market, charts are the rule. Beans saw short covering off the Nov. $12.60 support area. Meanwhile, the $12.79 high held onto the upside for the third consecutive day. Until the USDA gives numbers to trend off of, beans will sell rallies off good harvest yields and buy breaks off rumors of strong  demand."

 

 

Mike

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At mid-session:

The Dec. corn futures contract is trading 2 1/2 cents lower at $4.41. The Nov. soybean futures contract is trading 3 3/4 cents higher at $12.70. Dec. wheat futures are 6 1/2 cents lower at $6.79 per bushel. The Dec. soymeal futures contract is trading $0.60 per short ton lower at $401.80. The Dec. soyoil futures are trading $0.57 higher at $41.23. 


In the outside markets, the NYMEX crude oil is $0.44 per barrel higher, the dollar is higher and the Dow Jones Industrials are 202 points higher.

 

Mike

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At the open:

The Dec. corn futures contract is trading 3/4 of a cent higher at $4.44. The Nov. soybean futures contract is trading 7 3/4 cents higher at $12.74. Dec. wheat futures are 1 cent higher at $6.86 per bushel. The Dec. soymeal futures contract is trading $1.60 per short ton higher at $404.00. The Dec. soyoil futures are trading $0.46 higher at $41.12. 


In the outside markets, the NYMEX crude oil is $0.11 per barrel lower, the dollar is lower and the Dow Jones Industrials are 85 points higher.

 

Mike

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At 7:50am:

Jeff Coleman, THe Trean Group analyst and CME Group floor trader, sizes up today's farm markets:

 

"The big three grain markets are all slightly higher this morning as continued cold and wet weather across the Midwest has traders wary of a slowdown of the 2013 crop harvest. Rumors of more buying from China and the unwinding of the wheat/corn spread had corn futures higher yesterday and continues to lend support to the corn markets. November soybean futures are up this morning, as strong export inspections from yesterday and the slowdown in harvest has futures looking at a higher opening today."

 

Mike

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At 7:35 am:

Early calls: Corn is seen 1-2 cents higher, soybeans 3-5 cents higher, and wheat 1-2 cents higher.

Trackers:
Overnight grain, soybean markets=Trading higher.
Crude Oil=$0.05 per barrel higher.
Dollar=Lower.
Wall Street=Seen trading higher, despite the looming debt ceiling deadline.

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

 


More in a minute,

 

Mike

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20 Replies
Honored Advisor

Re: Floor Talk October 16

  • Trade sources say that China has bought as much as 300,000 tonnes of corn
    from the U.S. this week, for delivery from March through May 2014, at
    CK4

    around $260 per tonne CIF—at $310/tonne after taxes, that’s about 25%
    cheaper than Chinese domestic corn. The President of COFCO did say today
    that China could import 3-5 MMT of wheat in 2013/14, well below some pri-
    KWZ3 vate forecasts for as much as 10 MMT in imports this season. 

     

    Quote from fcstone grain comments this morning.

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Veteran Advisor

Re: Floor Talk October 16

SW, thanks for the update on corn exports. One thing about this years corn crop compared to the 2011 and 2012 corn crop is the quality. We may raise a large corn crop this year, but Im thinking export demand for our higher quality corn could consume this crop rather quickly. Mike, will the Chinese rob the US soybean crop during the government shutdown?

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Veteran Advisor

Re: Floor Talk October 16

sw,

 

Thanks. It's pretty clear that China likes these lower level corn prices. I think they'll be buyers up until the $5 mark. We'll see. How are you getting along with your marketing plan for this year? And can I ask if you would like to join us for the Successful Farming Marketing Academy in Kansas City?

 

What do you say?

 

Thanks,

 

Mike

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Honored Advisor

Re: Floor Talk October 16

I might have a hard time calling it a "robbery" when the grower/producer/farmer hauls it to town and says give me a check.

 

Now if the buyers came in and snookered the grain co's into selling great quantities and %ages of this crop that isn't even all harvested yet and they do not have physical supply in the tank. . . Oh darn.

 

With the consolidation in the grain merchandisers #'s I find that hard to swallow. Much easier when there were a dozen or so but now there are only about 4 or 5 players much harder to get away with that. Kind of like lawyers ...fight it out in the court room then meet for drinks and dinner that night.

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Honored Advisor

Re: Floor Talk October 16

Mike,

 

These were the export inspection numbers from stone this week

 

Corn 21.7 million bushels

Beans 46.9 mln bu

Wheat 25.3 mln bu

 

 

 

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Veteran Contributor

Re: Floor Talk October 16

I am confused why you would think the Chinese would be interested in buying corn up to $5 ???   So you really think they will chase a 60 cent rally?

 

In fact they are paying a premium to the USA vs.. Ukrainian or Brazilian corn.   I wonder if that continues?   I certainly don't think it will continue if the USA price goes up.

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Veteran Advisor

Re: Floor Talk October 16

Kstater85,

 

I say that only because it has been their behavior in the recent past. Traders on the floor have been watching this phenomenon for the past few years. They say China is an excited buyer until $5. It's not that they won't buy above $5, but they really slow past the $5 level.

 

Mike

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Senior Contributor

Re: Floor Talk October 16

If the Gov opens back up will the sales and export reports be brought up to date?
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Frequent Contributor

Re: Floor Talk October 16

Mike - Can any of the traders say what is driving the move in oats the last two days?  Thanks!

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