cancel
Showing results for 
Search instead for 
Did you mean: 
Senior Contributor

From the floor November 12

After the close:

On Friday, the funds sold 30,000 corn contracts, 14,000 soybean futures and 9,000 wheat contracts.

 

Mike

--------------

At the close:

The Dec corn futures settled down the 30 cents limit at $5.34. The Jan. soybean contract settled at its daily 70 cent low limit at $12.69. The Dec. wheat futures closed 34 3/4 cents lower at $6.69 1/4.  The Jan. soymeal futures contract closed $18.40 lower at $341.70 per short ton. The Jan. soyoil futures contract closed $2.50 lower at $52.85.


In the outside markets, the NYMEX crude oil is $2.80 per barrel lower, the dollar is lower, and the Dow Jones Industrials are down 111 points.

 

Mike

---------

At 12:15pm:

Soybeans hit limit down (70¢) again. Earlier in the day, beans went 70¢ lower, bounced off that limit. But, we are now sitting at limit down again. For corn, it was bidding at limit down, but didn't go there. Corn is a quarter lower and wheat is a quarter lower.

 

Mike

---------

At 11:25am:

WHoa! The floor just got really loud, and low price marks were getting blown through. Corn is now down 22¢, soybeans are down 67¢, and wheat 22¢. Somebody must have put in a huge sell order. China is really sitting on this market, wow!

 

Mike

------

 

At mid-session:

The Dec corn futures are 13 1/4 cents lower at $5.50 3/4. The Jan. soybean contract is 35 1/2 cents lower at $13.03 1/2. The Dec. wheat futures are 15 3/4 cents lower at $6.88 1/4.  The Jan. soymeal futures contract is $8.60 lower at $351.50 per short ton. The Jan. soyoil futures contract is $1.70 lower at $53.65.

In the outside markets, the NYMEX crude oil is $2.39 per barrel lower, the dollar is lower, and the Dow Jones Industrials are down 82 points.

 

One trader says, "This is a buying opportunity. Don't go home, for the weekend, 'short'."

 

The floor is pretty quiet, at this time. In the bean pit, a lot of traders have left, for the time-being. They might be back in for the close. But, they are gone right now.

 

Mike

-------

At 10am:

 

Grain markets remain sharply lower, driven down by China's rate hike news Friday. In fact, one trader says, "This is all about China. This is the first break after the USDA report. I think, short-term, this is a sign of a top, we're going to cleanse this market. Long-term, I don't think we're done rallying. But, yes, this is about China's power to influence the market."

 

Mike

----------

At the open:

The Dec corn futures opened 10 3/4 cents lower at $5.53. The Jan. soybean contract opened 34 cents lower at $13.05. The Dec. wheat futures opened 12 1/2 cents lower at $6.91 1/2.  The Jan. soymeal futures contract opened $6.60 lower at $353.50 per short ton. The Jan. soyoil futures contract opened $1.80 lower at $53.55.

 

In the outside markets, the NYMEX crude oil is $2.08 per barrel lower, the dollar is lower, and the Dow Jones Industrials are down 45 points.

 

A lot of selling, here on the floor, to start the day Friday.


Mike

-----------

At 7:35am:

USDA releases bullish export sales Friday. For corn, sales came in at 628,000 metric tons, while the trade expected between 300-500,000 metric tons. USDA says soybean sales were 929,000 when the trade thought between 800,000-1.5 million. For wheat, weekly sales came in at 832,000, while the trade expected between 300-600,000 metric tons.

 

Meanwhile, soybean meal weekly sales were 407,900 and soyoil sales were 6,000 metric tons.

 

Mike

------

At 7:15am:

While there is a lot of buzz this morning about soybeans, consider this. And we'll have more on this over the weekend from our Brazilian counterparts. But, it's being reported in Brazil that soybean production in Mato Grosso, the top producing state there, will not see a year-over-year increase in production for the first time ever. The sources quote was, "This is the first time that the crop will not register growth." A drought delayed planting too long so farmers switched to cotton. I find this very interesting. A full report on this will be provided next week by our Brazilian reporter friends. Look for a thread on this, from them, over the weekend.

 

Mike

----------

 

At 7:05am:

USDA will release its Export Sales Report at 7:30am CST. Here are the trade estimates:

Corn 300 to 500,000 metric tons , soybeans at 800,000-1.5 million, wheat at 300-600,000 metric tons.


This morning, South Korea bought 165,000 metric tons of corn, 55,000 metric tons of feed wheat.


Mike

--------

At 6:30am:


Early calls: Corn down 3-5 cents, soybeans down 20-22 cents, and and wheat 7-9 lower.


Trackers:

Overnight grain markets=Trading lower.

Crude Oil=$1.48 lower.

Dollar=Lower.

Wall Street=Seen trading lower with more corporate earnings reports coming in lower than expected. Yesterday, it was a tech company and today a food company reporting lower earnings.

World  Markets=Lower.

 



More in a minute,

 

Mike

0 Kudos
8 Replies
Senior Contributor

Re: From the floor November 12

Bullish export sales?  I guess someone must have a much sharper pencil than I have because with those numbers we're only selling roughly 50-60% of what is needed to meet USDA projections for corn. 

0 Kudos
Senior Contributor

Re: From the floor November 12

GoredHusker,

 

You're right, the export sales were not spectacular. But, they don't have to be. They just need to be holding above trade expectations, and they are. The demand from China is enormous, one that some believe can't be sustained. Corn sales were good enough, not great. They were bullish in the sense that they weren't bearish. For this day, other factors trumped the sales report. But, the positive sales underpin an otherwise very negative news day.

 

Mike

0 Kudos
Senior Contributor

Re: From the floor November 12

OK, now I want to hear why 'some people believe that demand from China cannot be sustained'.

 

This should be good. Or I don't understand the meaning of 'sustained' as it is applied in that statement.

0 Kudos
Senior Contributor

Re: From the floor November 12

Palouser,

 

I think the trader's quote, regarding Friday's export sales, was "China was a buyer of 740,000 metric tons while taking 1.314 MMT. Both are amazing numbers that cannot continue."

 

So, the word sustained could be replaced with maintained. It's his opinion that China's level of buying is stellar.

 

Mike

0 Kudos
Senior Contributor

Re: From the floor November 12

Actually, what I get is that the trade continues to expect extremely poor export sales and shipments in corn because of the price.  I don't know if anyone is really paying much attention to the details here.  USDA has pegged exports higher this year than last year.  We're selling on average on a weekly basis for the past two and a half months just roughly 50% of what is needed to be sold to meet USDA expectations.  If you look at the weekly shipment pace, we're already and have been for a while behind last year's pace. 

0 Kudos
Senior Contributor

Re: From the floor November 12

I think it gets at a very important idea, one that is behind the huge inventories they maintain, even while buying huge amounts of imports of the same food commodities. It isn't about economic efficiency in terms of the idea of JIT deliveries, etc. The importance of continuing to improve standards of living depends partly on avoiding severe temporary shortfalls in domestic production that could trigger titanic global reactions in food commodities - and maintain civil order at home and abroad. It's not just the 'Shoes of a Fisherman' story where stocks are available but China doesn't have the resources to get it, therefore someone has to make a charitable sacrifice - it's that directing those resources to China in an emergency would have catastrophic market consequences.

 

The upshot is, when the time comes, China will be able to mitigate the market effects of shortages using it's own stores, but if it needs them on the open market, they will get them, sustainable or not - and it might not be pretty. We need to respect China's commitment to store up to a third the world's inventories on some grains.

0 Kudos
Veteran Advisor

Re: From the floor November 12

One trader says, "This is a buying opportunity. Don't go home, for the weekend, 'short'."

 

Is it time to buy now or should we keep waiting? 

Just pokin a little fun here this rainy day has me watching this computer to much.  For what it's worth milk is down to!

0 Kudos
Contributor

Re: From the floor November 12

I think your statement China is really sitting on the market might be more true than people think. They probably are going to step in at some point and buy the heck out of this thing, but for now their words, not actions, have this market reeling. Patience is needed.
0 Kudos