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marketeye
Veteran Advisor

From the floor June 23

At the close:

The Dec. corn futures closed 4 1/4 cents lower at $6.46, while the July corn contract closed 3 cents higher at $6.80 1/2. The July soybean contract settled 12 1/2 cents lower at $13.17 3/4. The July wheat futures closed 10 3/4 cents higher at $6.49. The July soybean meal futures settled $6.50 per short ton lower at $340.60 and July soyoil futures settled $1.00 lower at $55.15.

 

In the outside markets, the NYMEX crude oil is $4.26 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 153 points.

 

Mike

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At 12-Noon:

Grain and soybean markets remain in double-digit lower territory. One analyst is saying, "This is still big time fund selling, and it is pushing the little specs out as well now.  Market is trying to act as if a low is being formed.  There is some consumptive buying trying to appear.  The outside news about employment data here and the IEA and US government releasing crude oil from inventories seems to be the main factors to push prices down.  There are 2 different forecasts for the coming weeks, one hot and dusty and one still a little wet, to confuse people.  I think the close will be important today.  A decent close could mark the end of this as options for July go off the board tomorrow and July deliveries start next week.  A strong Dollar hurting the bull case, but also an item to watch here as it is near recent highs again and if it fails it could get ugly for the dollar.  But it looks like it could be making a medium term bottom here and so it needs to be watched.  Prices overall are still high, but we have taken a lot of the risk out of the market and we probably need to look for a bottom now."

 

Mike

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At mid-session:

The Dec. corn futures are 16 1/4 cents lower at $6.34. The July soybean contract is 18 1/4 cents lower at $13.12. The Sep. wheat futures are 19 1/2 cents lower at $6.53 3/4. The July soybean meal futures are $4.50 per short ton lower at $342.60 and July soyoil futures are trading $1.30 lower at $54.85.

 

In the outside markets, the NYMEX crude oil is $4.56 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 178 points.

 

Mike

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At the open:

The July corn futures opened 30 cents lower at $6.47 1/4, while Dec. corn was trading 24 1/2 cents lower at $6.26. Remember, today's corn daily limit has been expanded to 45-cents, because we closed limit down yesterday. The Aug. soybean contract opened 19 1/2 cents lower at $13.12. The Sep. wheat futures opened 25 cents lower at $6.49. The Aug. soybean meal futures opened $3.40 per short ton lower at $344.50 and Aug. soyoil futures opened $1.33 lower at $55.04.

 

In the outside markets, the NYMEX crude oil is $4.51 per barrel lower, the dollar is higher and the Dow Jones Industrials are down 219 points.

 

Mike

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At 9:15am:

Ooohhh, this might hurt. USDA Thursday announced a cancellation of a 452,500 metric ton sale of U.S. soybeans to an 'unknown' for 2010-11 delivery. About 300,000 mt was rolled into new crop.

 

What do you think? This can't  be good can it?

 

Mike

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At 8:15am:

Early calls: Corn 8-10 cents lower, soybeans 2-4 cents lower and wheat 2-3 cents lower.


Trackers:

Overnight grain, soybean markets=Traded lower.

Crude Oil=$4.15 lower.

Dollar=Higher.

Wall Street=Seen trading lower as U.S. jobless claims go higher.

World Markets=Mixed. Asia/Pacific is mixed, Europe is lower.

 

More in a minute,

 

Mike

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6 Replies
SouthWestOhio
Senior Contributor

Re: From the floor June 23

Mike, how about providing a little blow by blow description of yesterday's action.

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marketeye
Veteran Advisor

Re: From the floor June 23

It seems that the markets are falling even lower than the bearish of bears thought. Corn and wheat both took a bath. As it's been described before, it seems like everyone just hit the sell button yesterday, all day long. Al Kluis, Kluis commodities told his customers this morning that he sees grain ownership shifting from funds to commercials, as liquidation continues. As far as yesterday's price action, some believe the wheat market may have hit a new low and is now ready to work its way back. Perhaps corn can follow wheat?

 

Meanwhile, here is more blow-by-blow from yesterday's action from wheat option trader Tom Barry: "The action near the lows on Wednesday had the wheat almost limit down and at the lowest levels since last July, with traders switching from trying to take advantage of any edge that 'paper' was  giving up, to simply defending against what was becoming an unknown and threatening event with very little educated opinions and almost no desire to fade it.  Sure enough, things were evidently becoming over done.  And that's when Rand showed up to buy 1000 serial August 720 calls as the underlying wheat was making a steady and plodding effort to dig its way out of the massive hole that had caught even those remaining bears a bit off guard.  As mentioned in Tuesday's comments, there was no shortage of people who expected us to make another attempt at the recent lows, but not decimate them like we did on Wednesday.  Certainly a tough week and a half for the bottom pickers, as we've over shot most peoples' extreme downside targets."

 

 

Mike

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marketeye
Veteran Advisor

Re: From the floor June 23

USDA Weekly Export Sales Thursday:

 

Corn=531,100 metric tons, up 39% from a week ago, but down 9% from previous 4-weeks.

Soybeans=184,000 mt is up 29% from previous week, but down 26% from previous 4-weeks.

Wheat=661,300 metric tons.

Soymeal=37,000 metric tons.

Soyoil=6,000 metric tons.

 

Mike

 

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marketeye
Veteran Advisor

Re: From the floor June 23

SouthWestOhio,

 

Here is a lot of blow-by-blow on the markets from this floor trader: "Twelve months ago, July10, corn was at $3.25 a bushel..the drought in the FSU, pushed the Russian gov’t and others to put a moratorium on exports and lock up 20 to 30 million tons of grain… the world responded by using feed wheat out of France and Canada and rationing use…the Southern Hemisphere responded with larger acreage and a record soy crop and Australia saw large recovery in wheat production.
 
Now, 12 months later Russia has opened up market for exports that was announce three weeks ago…the world is awash in SRW. So, we see domestic users here replacing old crop corn use with wheat. Remember, VSR Variable Storage Rate put our SRW to large carries and kept our exports from being competitive all year… now as new crop comes off we have lots of wheat for sale that is competitive with corn..
 
Then Stats Canada out this morning with larger than expected wheat and canola acres. Perhaps the June 1 survey missed the planting problems but our survey could miss too.  So, bulls are worried about next week's acreage stats…
 
Then energy markets started to break as economy sours…remember the last 18 months we have been living on stimulus. So, this is the first summer without Qe2 and the like… sour jobs claims this week on heals of poor unemployment number from the 1st week in June…Bernanke has been dour in recent comments…
 
Now, we here the US gov’t is releasing 60 million barrels from the reserve… and gasoline is down 16 cents..if ethanol is down 16 cents it the equivalent of 30+ cents in corn… 150 points for soy oil if diesel is down as much…
 
Also high prices and early worries of Argentine drought in November (before it started raining there) had Chinese build large in port stocks… today we see they have cxled 450,000 tons of beans sales for old crop rolling 300 to new… also heard they sold beans to South Korea one cargo…very strange but shows that the market there is sated…
 
Fearful traders will await to see acreage and stocks numbers on June 30th…but extraordinary fund length in corn and beans may not be able to wait to see the number… it should be another large day of liquidation…and if June 30th are beningn numbers then we will need to go back to median numbers… we have hitched our wagon to fuel markets and if those markets are trending lower it will be hard to sustain rallies unless crops is threatened by weather."

 

 

Mike

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SouthWestOhio
Senior Contributor

Re: From the floor June 23

Thanks Mike I needed that. Smiley Happy

 

So is everyone up there bearish? (I might take that as a good sign.)

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Palouser
Senior Advisor

Re: From the floor June 23

Grain ownership shifting from funds to commercials?????????????

 

That requires an explanation.

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