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Veteran Advisor
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Registered: ‎05-03-2010
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From the floor April 12

[ Edited ]

At mid-session:

The May corn futures are 14 3/4 cents lower at $7.61 1/4. The May soybean contract is 33 1/2 cents lower at $13.35. The May wheat futures are 33 3/4 cents lower at $7.65. The May soybean meal futures are $6.20 per short ton lower at $343.50.


In the outside markets, the NYMEX crude oil is $3.31 per barrel lower, the dollar is lower and the Dow Jones Industrials are down 124 points.

 

Profit-taking and the outside markets are applying the pressure on the grain and soybean markets. OPEC announced that its March production was down 626,700 barrels per day.


One analyst says, "I think a lot of this is Goldman Sachs telling clients to liquidate positions in commodities. Crude Oil taking the bigger hit, and in the grains all are down on what seems to be big time spec selling, he says. 
"I see negative charts to help the selling pressure along.  Some on TV talking about the Saudis cutting production due to lack of demand.  Lack of demand for crude implying that maybe the economy is getting to a point of going backwards, maybe. I think not, I think crude just got too high priced and the demand is below, but we will see on that."

By the way, it looks like I'll be planting corn tomorrow with a few Illinois farmers after all. Thanks guys, looking forward to getting my hands dirty.


Mike

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At the open:

The May corn futures opened 15 cents lower at $7.61. The May soybean contract opened 27 cents lower at $13.41 3/4. The July wheat futures opened 25 cents lower at $8.06 1/2. The May soybean meal futures opened $4.20 per short ton lower at $350.70.


In the outside markets, the NYMEX crude oil is $3.76 per barrel lower, the dollar is lower and the Dow Jones Industrials are down 112 points.


Mike

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At 8:25am:

Meanwhile, I have to say that it is beautiful in Chicago, this morning. it's a bit chilly but the sun is out and the grass is green, and very little 'chop'. I still would like to get off the concrete and into dirt, if anybody within 120 miles of Chicago is planting today or tomorrow. We can talk markets and planting right in the tractor cab. What do you say? Let me know.

 

Mike

 

---

At 7:20am:

Well now. The market has plenty to chew on this morning. First, China is spitting out some bearish news by reporting that their soybean crushers are sitting on record stockpiles. The Minister of Agriculture says China's 2010-11 soybean imports will be 54.0 million metric tons, less than the USDA's estimate of 57.0. Things get a little better with China reporting April soybean imports could be 1.9% above a year ago and 22% above a month ago. but, China's New Year Holiday was last monthh, keeping everything low.

 

Also, Tuesday, Japan bought 500,000 metric tons of corn for July-Sep delivery. The origin is unknown. Japan is seeking to buy 147, 712 metric tons of U.S. wheat.

 

So, with sharply lower early calls and overnight markets, you wonder if the lower world stock markets and crude oil is pressuring the grains and soy, along with China's drop in annual soybean imports. That's all bearish.

 

--What's bullish? Let's list them: Tight stocks, expected rains later this week, snowmelt and flooding in North Dakota, more snow for NW Iowa and the upper Midwest this weekend, Japan's eventual return to the grain import market, a weak dollar, funds throwing money back into the farm markets. I'm sure there are more, I need a cup of coffee. Let me keep thinking...

 

Mike

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At 7am:

Early calls: Corn down 4-6 cents, soybeans 7-9 cents lower, and wheat down 7-9 cents.


Trackers:

Overnight grain, soybean markets=Trading lower.

Crude Oil=$0.54 lower.

Dollar=Lower.

Wall Street=Seen trading lower as Alcoa started off the earnings season with weaker numbers than the street expected. Plus, Japan has raised its nuclear accident severity rating, equaling it to the Chernobyl crisis that occurred 25 years ago. 

World Markets=Lower.



More in a minute,

 

Mike

Senior Contributor
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Registered: ‎05-13-2010
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Re: From the floor April 12

Mike now that you've had your coffee you might want to add yesterday's crop progress report to the bullish column and how about a SA harvest update.

Veteran Advisor
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Re: From the floor April 12

I think for wheat, the Crop Progress Report was certainly bullish. Some Oklahoma farmers are contemplating ripping up the wheat crop and planting something else.

 

However, I'm not ready to say the corn planting percentage is bullish. It looks like the averages are holding their own. Now, that looks like it will change next week. But, this week's planting percentage seems neutral.

 

As far as Brazil's harvest, I noticed yesterday that a report indicated 77% of the soybeans had been harvested.

 

Mike

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Registered: ‎04-30-2010
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Re: From the floor April 12

Check out the Marketeye's newest video report, talking weather, ethanol, and the 2011 corn crop with Dustin Johnson, E-Hedger broker.

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Re: From the floor April 12

The reason I feel the progress report was bullish corn as well, is the yield goals set by USDA. To even have a chance to meet the above average yield they predicted we must stay ahead of the crop progress average all season. Delays in planting and weather stress will quickly make it impossible to reach over 160 bpa. So far this week's report say our planting progress of 3% is equal to the five year average. Our five year yeild average is below 160. Corn rarely makes up for setbacks in development. We are off to a lousy start to keep the projected carryover from dropping lower.

 

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Re: From the floor April 12

   Is this the big selloff that usually happens the 3rd week of June?  Were grains overbought after the Japan disaster?

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Re: From the floor April 12

My opinion is this is just a 'technical' sell off. There is no physical fundamental news involved. Meanwhile US wheat continues to have major problems and possible problems and the corn inventory is a big question with use unabated and no possible way to know what the coming corn crop will be. This is a good time for profits to be taken and maybe also a good time to get back in for traders - but that is little of my concern.