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Veteran Advisor

From the floor March 29

After the close:

 

Did you know that, if you wanted to, you could trade the USDA numbers as they are released at 7:30? I wrote this story to help those that didn't realize it. But, I'm also curious how many actually were aware of this.

 

Full story at http://tinyurl.com/4ajtsp9

 

Mike

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At the close:

The May corn futures settled 3/4 of a cent higher at $6.71 3/4. The May soybean contract closed 13 cents higher at $13.61 1/2. The May wheat futures ended 12 cents higher at $7.37 1/4. The May soybean meal futures settled $0.50 per short ton higher at $358.60. The July soyoil futures settled $0.49 higher at $57.02.


In the outside markets, the NYMEX crude oil is $0.76 per barrel higher, the dollar is lower, and the Dow Jones Industrials are up 81 points.


One floor trader says, "With no fresh news out this morning, I think this is all positioning before Thursday's big acreage report for soybeans and wheat.  There is some short covering and maybe even some bargain hunting.  Corn continues to see fund liquidation as no new corn sales were reported."


Brazil Note: Concerning the new Brazil production numbers released Tuesday by Gazeta do Povo's Crop Expedition. Here's Luana Gomes's report:

---19.53 mmt soybean crop in Mato Grosso, 3.9% above last season. As of last week, over 80% of the crop was harvest and, despite of all the rains, there were no significant losses there. Even taking into account the high moisture grains that will need to be dried out before hitting the market, average yields are pretty good there.


--For Parana state, the Crop Expedition figures were 14.57 mmt of soybean (+5.1% over last year) and 5.52 mmt of summer corn (-18.5%). With over 70% of the soybeans harvested, Parana’s situation is similar to Mato Grosso’s. High moisture grains and isolated crop problems due to excessive rains during harvest time, but no significant yield losses. With 45% of the first crop corn harvested, average yields are also pretty good in the state, as corn can take the excessive rains better that the soybeans. The crop is smaller than last year’s because there was a large acreage reduction (-20.1%) because prices were pretty low during planting season (final quarter of 2010).


Mike

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At mid-session:

The May corn futures are 3 1/2 cents higher at $6.74 1/2. The May soybean contract is 13 cents higher at $13.61 1/2. The May wheat futures are 13 3/4 cents higher at $7.39. The May soybean meal futures are $4.40 per short ton higher at $358.00. The July soyoil futures are $0.29 higher at $56.82.


In the outside markets, the NYMEX crude oil is $0.66 per barrel higher, the dollar is lower, and the Dow Jones Industrials are up 58 points.

 

Mike

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At 10:30am:

Corn is 2 cents higher, soybeans have surged to 16 cents higher, and wheat is 10 cents higher. The thought is that traders are just nervous being short this USDA Report Thursday.

 

Mike

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At the open:

The May corn futures opened 1/2 of a cent lower at $6.70 1/4. The May soybean contract opened 4 cents higher at $13.52 1/4. The May wheat futures opened 3/4 of a cent lower at $7.24 1/4. The May soybean meal futures opened $3.60 per short ton higher at $367.20. The July soyoil futures opened $0.09 higher at $57.20.


In the outside markets, the NYMEX crude oil is $0.13 per barrel higher, the dollar is lower, and the Dow Jones Industrials are up 29 points.

 

Mike

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At 7:55am:

Internatioal Grains Council (IGC) has cut the U.S. 2010-11 wheat exports by 3.6%, due to cheaper Australia offers.

 

Regarding Thursday's Planting Intentions Report, one analyst is saying this morning he thinks corn acres will come in at 91.0 million or less, soybeans at 77.0 million, wheat estimates are still a big question mark, and rice at 2.9 million. That rice number would put the supply at an uncomfortable level, he says.

 

Mike

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At 6:45am:

Early calls: Corn 2-4 cents higher, soybeans 7-9 cents higher and wheat 3-5 cents higher.


Trackers:

Overnight grain, soybean markets=Trading higher.

Crude Oil=$0.93 lower.

Dollar=Higher.

Wall Street=Seen trading slightly higher with data coming out on home prices and consumer confidence. 

World Markets=Mixed-to-lower.

 



More in a minute,


Mike

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13 Replies
Veteran Advisor

Re: From the floor March 29

Mike I read a report from Georgia of a dairy farmer who's corn farmer came to him and asked for a gauraunteed price that was double last years price for silage. He said if he couldn't get that he was going to plant cotton.  Just one more thing to throw in the mix.

Have we ever had so many crops bidding for acres so competitively? 

In the end I think we trade this report for and hour and then we trade that four letter word snow!  there is a chance for snow this weekend in Iowa and minnisota.   I know guys who were planting corn on the 5th of April here in Kossuth county last year. 

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Senior Contributor

Re: From the floor March 29

Hey jr...... Maybe they can mount propane heaters on there planters this year...... Surely does not bode well for early planting as of today...... p-oed

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Veteran Advisor

Re: From the floor March 29

jrsiajdranch,


To your question of "Have we ever had so many crops bidding for acres so competitively?" I'm told the answer is no. And it's not being talked about, but I'm also told the demand for cotton acres will last two more years. 


On the length of time this report is traded, I guess I believe this thing will have more shelf life. The market is really nervous about what farmers will and will not plant. The aftershocks of this report will be felt for awhile. The weather, following the release of the report, will only amplify the acreage report, not make it less relevant. I think this is why you are hearing about so many traders trying so hard to get positioned before Thursday. Just a few thoughts, for whatever it's worth.


Mike


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Veteran Contributor

Re: From the floor March 29

Hi Mike, my question is can the southwest insure their crop at 80% on crops taken from cow pasture. If so won't that take us up to the 10 million acres they need. The face of ag.com says cotton at these levels are only something you dream of. Didn't say all acres would be harvested just planted. Could you ask the floor if this scenario could happen and if so would prices peak . PS could this also happen to corn.

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Veteran Advisor

Re: From the floor March 29

jrsiajdranch,


To be fair, there is an analyst that leans more towards your perspective about the market turning its attention, shortly after the report, towards the weather.

 

He says, "Therefore the old adage applies. When traders return Friday one day after the report, they will say; It's not what you plant, but what you grow, how's the weather? So, though these numbers give us a starting point for growing season perspective, it's mother nature who delivers the final report on yields and production."

 

Mike

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Veteran Advisor

Re: From the floor March 29

llakmf,

 

When you say Southwest, do you mean Texas, Oklahoma, Arkansas? I just want to be clear what farmers you are referring to. Thanks.

 

Mike

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Senior Contributor

Re: From the floor March 29

Mike..... It is my contention that thursdays report will only give the trade a snapshot of what farmers are thinking and if the markets have done there job or not as it relates to being sure that each crop has enough acres...... I think that most every trader remembers the last time that they went into a report thinking that there were not going to be enough acres only to have USDA find more..... Uncertainty seems to be the mood of the market to me...... After thursday....... All bets are off......p-oed

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Veteran Contributor

Re: From the floor March 29

yes

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Veteran Advisor

Re: From the floor March 29

llakmf,

 

Here's what I could find out on short-notice. Cotton can be insured up to 85%, but not sure about any
ground put into crop production out of pasture-land in the South.

 

Mike

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