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Senior Contributor

From the floor January 20

After the close:

It wasn't known earlier today, but we now know that China purchased 3.07 million metric tons of U.S. soybeans Thursday, according to a Dow Jones Newswire story. The purchases are to be delivered this year. China has now bought 64% of all U.S. soybeans sold in this marketing year, starting in September. In addition, it's possible more soybean deals could be inked Friday.

 

Mike

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At the close:

The March corn futures settled 12 3/4 cents higher at $6.54. The March soybean contract settled 2 3/4 cents higher at $14.14 1/4.  The March wheat futures closed 6 3/4 cents higher at $8.03 1/2. Soybean meal futures ended $2.00 higher per short ton at $385.30. The March soyoil futures closed $0.43 lower at $57.26.


In the outside markets, the NYMEX crude oil is $2.01 per barrel lower, the dollar is lower, and the Dow Jones Industrials are up 13 points.


The markets finished higher, due to a lower dollar, talk of China buying U.S. soybeans, and end-user buying in the corn and wheat markets. Plus, a Buenos Aires, Argentina Exchange lowered that country's corn crop 4.4.%.


Mike

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At mid-session:

The March corn futures are 5 cents lower at $6.36 1/4. The March soybean contract 16 1/2 cents lower at $13.95.  The March wheat futures are 10 1/4 cents lower at $7.87. Soybean meal futures are $4.00 lower per short ton at $379.30. The March soyoil futures are trading $1.29 lower at $56.40.


In the outside markets, the NYMEX crude oil is $2.17 per barrel lower, the dollar is moving higher, and the Dow Jones Industrials are down 38 points.


I'm hearing that China will announce a token 2.0 mln soybean purchase this afternoon.  One trader says, "I think today's lower market is just a healthy correction. Ethanol margins are flat, I hear. Also, trade coming to the conclusion that soybeans need to rally vs corn."

 

Mike

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At the open:

The March corn futures are 12 cents lower at $6.30. The March soybean contract opened 25 cents lower at $13.86.  The March wheat futures opened 13 cents lower at $7.84 1/4. Soybean meal futures opened $5.30 lower per short ton at $378.00. The March soyoil futures opened $1.23 lower at $56.46.


In the outside markets, the NYMEX crude oil is $2.10 per barrel lower, the dollar is moving higher, and the Dow Jones Industrials are down 51 points.

 

Pressure everywhere, this morning. Brazil raises rates, there's talk of China raising rates, and selling is seen across the commodity sector.

 

Mike

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At 9:25am:

Matt, Pierce, GrainAnalyst.com, says that even though there is a short-term setback in prices, bullishness reigns supreme. In his daily newsletter, Pierce says, "The trade feels things are entering a consolidation period with volatility expected to fall a bit more before traders want to establish fresh longs. The areas of interest are May and Dec with the July across the board showing the highest individual levels. There was talk that China inked a deal to import 500 TMT Australian feed wheat with no time period announced. This was taken as negative corn...I disagree. I think this is proof that they are looking for feedstuffs making this purchase the first of what I believe will be many for wheat and corn in the coming months."

 

 

--There's also talk that Argentina's farm-strike will last another week, due to lack of governmental movement on the issues at hand.

 

Mike

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At 7:10am:

South America Crops Update:


Here is an update from my contact in Brazil. He is an agronomist. In his  own words, "In Brazil, the weather conditions are excellent for the crops. There are just a few problems with "Asian Soybean Rust" due to high moisture in the leaves of soybean. Harvest is expected to surpass the 68 million tons of soybeans and 32 million tons of corn.

 

In Argentina`s crops, there is still uncertainty, with significant reductions in production. The problems center around irregular vegetative growth for both soybeans and corn.

 

Secondly, as of January 13, 93% of corn had been planted and 94% of soybean planted, according to the MinAgri (Ministery of Agriculture to Argentina).


 These three provincies represent 76% of total área planted of Argentina:

 

  • In Santa Fé Province, the lack of rain is significant – totals vary between 0-80.0 mm. But, most regions within the province have not received any rain yet in 2011.

 

  • In Cordoba Province, the rainfall amounts seem more normal – rainfall totals vary between 20.0 mm to 150.0 mm, in many regions within the province in 2011.

 

  • In Buenos Aires Province, the rainfall condition is similar to Cordoba Province.

See a slideshow of Brazil's crops (click here)

Mike

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At 6:45am:


Early calls: Corn sown 2-4 cents, soybeans down 3-5 cents, and wheat down 3-5 cents.


Trackers:

Overnight grain markets=Trading lower.

Crude Oil=$0.65 lower.

Dollar=Lower.

Wall Street=Seen opening lower on fears that China may increase financial rates. 

World Markets=Lower.


Other than the dollar, outside factors do not favor a higher grain trade Thursday. USDA's Weekly Export Sales don't come out until tomorrow. However, the govt's oil inventory report will be released this morning. And, the market is awaiting a soybean or corn purchase announcement from the Chinese delegation visiting Chicago today.

 


More in a minute,


Mike

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8 Replies
Frequent Contributor

Re: From the floor January 20

 

Hi

FWIW The French forcasted the EU27 wheat crop 2011 down with 900 000 metric tons

They also said ending stocks 2011 1,2 mln tons wich is extremly low!!!

IGC will release global wheat and corn late afternoon ...our time...

On the other hand....Ukraine have had a good winter for grains

EU  West and central more or less under water 

But....huge problems in the hogs by dioxin scandal in Germany   ????? feeddemand

bw

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Contributor

Re: From the floor January 20

Mike check your “private messages” under both of your Marketeye names. I sent you a message. Later Tom

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Re: From the floor January 20

hi mike, i disagree with you on rains on argentina on the provinces, my view is the following:

ok with that 76% on 3 provinces but distribution is wrong:

 

buenos aires: no rains in dec therefore corn is very damage. on the last 4 days (sunday and yesterday) they got between 50 and 250mm therefore soybeans there are great now

 

santa fe: same as buenos aires on corn but less rains for saoybeans, southeast is OK, also north but mid center just get some rains yesterday so i would say today 70% of the province is ok on soybeans

 

cordoba: some better rains for corn, and the hole province between 0 and 30mm for soybeans in this month so here soybeans are really damage ( i think cordoba is the no.1 on beans production, i would guess 25% of the hole country)

 

santiago 

 

 

 

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Senior Contributor

Re: From the floor January 20

Santiago,

 

Thanks for the input. Sorry, the particular amounts may have been misinterpreted. Overall though, it sounds like you agree with the agronomist's assessment of the crop conditions?

 

 

I do appreciate you stepping in and offering those refining comments.

 

Mike

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Contributor

Re: From the floor January 20

i think overall is ok, 

 

with the last rains my guess is that 35% of the production is very good (today is raining in north of the country)

other 25% is really bad and the rest 40% is normal

 

 

 

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Contributor

Re: From the floor January 20

Mike and Santiago send me an e-mail at bindner@midlands.net , thanks Tom

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Contributor

Re: From the floor January 20

Hi Mike.  Just when you thought the corn market was going to get a kick in the teeth, it turns back up.  This market is a lot stronger than I ever imagined.  Glad to have product to sell in a market like this. 

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Contributor

Re: From the floor January 20

Mike it will be harvest before they know how much loss just like what we found last year. I checked a automatic weather station at Canals, Cordoba and in December they had 2.97 inches and to January 20 have received .43 inches (Santiago area) and a site north at Carlos Pellegnini, S. F. in December they had 4.3 inches and to January 20 3.43 inches. That shows that the rain is very spotty. There are reports that corn loss is 60 % in parts of B. Aires. Tom

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