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Honored Advisor

Tid Bits

"One item that we are watching is that more information is coming out of the Chinese crush meeting that was held overnight. It looks like there were 7 companies that came together and discussed the current situation on soybeans and so far it sounds like 5 cargos have been defaulted by this group.

 

The margins as the soybeans get to China have been very poor and as a result the individual companies are having a hard time getting the credit for the soybeans. As a result, the crush companies are trying to get out of those trades.

 

As I mentioned earlier, 5 cargos have been canceled so far. Keep in mind, that each cargo represents one ship load or about 2 million bushels.

 

The latest information sounds like there could be another 20-24 cargos that could be canceled and that these Chinese crushers are looking for some help to get out of the shipments. Currently China is offering 8-10 cargos of those for sale. They are looking to get out of these cargos or looking to sell them back to the US or another customer. This is currently what is giving the soybean market some of its weakness. We will continue to keep an eye on this information and bring you more as we go forward."

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9 Replies
Honored Advisor

Re: Tid Bits

Of course this gives the soybean market some weakness.   It is exactly what they intended.  They are becoming better and better at attempting to drive the price lower.   We appear to be slow learners.......Smiley Wink

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Senior Advisor

Re: Tid Bits

So what do end users of soybean products in China do? Hogs, poultry and human consumption?

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Senior Contributor

Re: Tid Bits

Where did you copy and paste that statement from? Did you do the research and write that post?

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Honored Advisor

Re: Tid Bits

"As a result what has happened is that we have actually already seen 5 cargos of beans coming out of Brazil that has been defaulted on. There has been about another 22 of that either being cancelled or resold.

 

Now our research would indicate that about 12 of those so far have been sold to the US, one to Africa, and approximately 9 of those have moved to the EU

 

. We will have to continue to keep a close eye on that situation.

 

Something that makes the market uneasy is that there is about another 23 cargos out there that could be cancelled or defaulted on by the end of June.

 

We will keep a very close eye on that soybean market. That has the potential if that market does roll over and head lower; that defiantly has the potential to spill over into to our other markets."

 

 

 

MARKET COMMENTARY April 10, 2014

 

Raymond Jenkins

 

Corn futures sold off sharply this morning, with May and July futures down 8 cents at one time----but there was nice, gradual recovery into the close, with a short time spent on the plus side before closing a penny lower. I think we’ll take that one cent loss and consider a good day considering how things looked at mid-morning.

 

There is a lot of market chatter about the Chinese and the status of some of their soybean purchases. This is beginning to remind me of some previous episodes when there were too many beans in the pipeline, with resulting headaches and hiccups.

 

The dust is still settling from the Wednesday report, and the biggest thing I can glean out of it is the fact we have to maintain a strong, make that very strong, pace of corn shipments all the way through the balance of the marketing year to hit the current corn export numbers in the supply/demand grid.

 

We have a very good chance of rain this weekend---sure hope they are right!

 

 

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Honored Advisor

Re: Tid Bits

Iowa has confirmed its first case of Chronic Wasting Disease (CWD) in a deer.

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Honored Advisor

Re: Tid Bits

Ohio grape crop devastated

For grape growers the harsh winter has had a devastating effect on the grape crop.

Kenny Schuchter of Valley Vineyards near Cincinnati says there won’t be any of the popular vinifera grapes in 2014.

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Veteran Advisor

Re: Tid Bits

Keep posting Ray Jenkins commentary, Hobby...I get a pretty good chuckle out of the Jay Carneyeqsue negative spin on everything. Markets have rallied...corn is near $5 , Soybeans up near $15...and Ray writes like the sky is about to fall if exports don't pick up.

 

Like Carney tries to put a postive spin on every blunder that the zero makes, Ray tries to make a negative out of everything. Better sell today, and often before the stuff goes to zero . Sure wish I had sold the corn for $3.90 and the soybeans for $11 so I didn't have to worry about the new ACA taxes . LOL!

 

Not to say that we may grow a huge crop and have terrible prices in the fall. Ray MAY just be right, you know.

 

It's just funny to watch a grain buyer spin things.

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Veteran Advisor

Re: Tid Bits

Red,

 

sorry I don't fit your version of a good market analyst.....from what you wrote, I assume the standard requirement is being "all bullish, all of the time".........

 

I am a bit surprised you think those comments are "negative".....but to each his own

 

regards,

 

Ray Jenkins

 

 

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Advisor

Re: Tid Bits

A reminder to me of why sites like this can be dangerous to yout health even though there is some good info.

 

In my case not that I'm greatly influenced by anyone's opinion so much as that if I get in a spitting match over differences of opinion it has a tendency to make me get stubborn in defending my own.

 

Ego vs. Mr. Market is a bad match.

 

But anyway, haven't changed my own opinion any although certainly allow for the fact that weather could make me wrong (it can be bad, it can also be good). I'll accept that risk and am not terribly worried about the fundamental factors discussed here- they seem as likely to disappoint as to get tighter.

 

Weather can also happen later rather than sooner so there are always options down the road- literally. A break may offer a chance to buy some calls cheaper to protect sales if that happens to seem prudent at the time.

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