Floor Talk October 16

[c-x-1]

rumor around that USDA might wait and effectively combine monthly S/D & WASDE until 11/8

[c-x-1]

NATE,

looking at Oats charts - it has remained strong to corn..... i.e. unable to take out last years lows....have to suppose weak longs got capitulated out on low - i show a charting tgt -- testing 2008 highs in mid-winter/early spring.

don't know a thing about fundamentals...but assume they are a bit tighter on balance sheet than corn.

thanks.

[marketeye]

For Sale: Brazil highways. The highest bidder gets BR-163.

Full Story:  Brazil to Auction Off Roads

Mike

[giolucas]

Cx1,

If my memory serves me right, when I was on the floor, the Oats pit was controlled by a family.  The the orders the runners brought in were basically served to the family.  Not a very active market. 

[teaspoon73]

    What family would that be?  The DiFronzo, or maybe Little Jimmy Maecello. Some other leading citizens could be The Horse Buccierri or brother Fifi Buccierri. In the oats pit it is probably Willie Potatoes Daddano or North Side Gordy Weems.  There are so many good families in the windy city.

[Palouser]

There is a $100 a ton advantage to imported corn compared to the domestic Chinese price ($370?).

They have plenty of room to play. The action they can't control is govt. auctions of reserves. But there is a lot of room in the margin. At this point it would be cheaper for China to let imports cool the domestic market. But in the long run they will not let prices discourage plantings in the spring.

This could be the driver of the rumor that China has been buying hard in the US with no reporting of sales (true or not, we won't know until the numbers come out when the government is up and running again).

China will buy at any price if it A) makes financial sense and B) If the government decides it needs corn for reserves (at any market price) and C) if it needs to keep supplies coming through the pipeline to make sure diets are improved country wide (at any price).

There are no 'magic numbers' for China imports.

[marketeye]

Palouser,

Tomorrow, I will offer up this story: Three Reasons Why Corn Doesn't Trade Consistently at $3.00

Hint: China is a big reason why.

Mike

[Blacksandfarmer]

Palouser, I think its a no brainer for China to buy large quantities of grain right now. Corn and beans are priced right, and with no reporting the market wont swing higher with large purchases. Grain terminals work on fixed cost so they have no reason to hold onto the grain, especially with a potentially large crop looming.

[c-x-1]

that is a good one giolucas and teaspoon!!

oats are thinly traded, no doubt.

I used to trade lumber in the late 1900's---talk about thin....a liquid day was 130-180 ticks/day with volume 1-2k contracts.

could sit there 15 minutes -- mid-session-- with no trade..............

--China has probably booked 100 cargos of combined grains since 9/30

[sw363535]

Mike,

Marketing is never as much fun on a long tail as it is on the way up.  I am usually more comfortable when I know there is profit margin to work with.  Good yields and some cheap water from the sky sure helps a producer swallow weaker prices.  I tend to reward a rising market and be patient on a slide down. It never goes as high as expected or as low as feared.  Bean prices are in a good profitable spot for us so we have been a little more agressive selling them.

Our guys have done a good job of not letting the sliding market steal their patience.   Corn--We got 25% priced in the spring and with the carry over from last year that will take care of the expenses til spring.  Then we will take advantage of our storage and local strong basis position.  Assuming the world will still need grain.  If they don't we will leave the production business with bins full.   🙂   Just kidding, accepting some risk is part of the job.

We will be in KC the week of the meeting.  Been considering it.  I assume there is a little room left in the room?  May come by and say hi if I can.