Market Report

Markets 11/9/15 @ 12:13pm
Dow -221.10
S&P -27.03
Nasdaq -67.32

I have been happy to see the macro markets be less influential to grains, but as of Friday some movement in Oil and the USD has me thinking the market will have to listen again.

The US Dollar surged from 98.00 to 99.47 on Friday, pulling back today yet still sitting above 99 which is bringing us back to the levels we haven’t seen since April 23^rd.  If you remember these levels, then you know it seemed to be a primary influencer in the grain markets.  The strong US Dollar can potentially reduce exports as other countries pricing becomes more attractive.  The good news is we use most of our own corn locally, which leads us to OIL.

Oil (Dec WTI) finished last week on the soft side in fact lost more than $2 a barrel currently with the next support line found at $43.00 while this may be good for fuel hedgers, it doesn’t mean a lot for ethanol demand.  Just something to keep your eye on as oil is an outside market which has the power to damage corn demand for ethanol use.

Grain Markets 11/9/15 @ 11:58am

Dec Corn -5’0 @ $3.68’0
Jan Beans -0’4 @ $8.66’6

USDA Report tomorrow at 11am

Corn – The trade is anxious for the USDA S&D Report scheduled for tomorrow at 11am.  Not much corn left out in the fields the USDA currently estimates corn at 168 Bpa will we see it push above 170?  It seems most are concerned this will be a bearish report.  Currently we have strong support at $3.60, but with the market sitting at $3.68 with pre-report positioning, a very negative report could easily push us through it for the short term.  Though I still believe the $3.50-$4.00 trade range I mention in the past remains relevant.  In fact, if we go back down to those levels a buy back strategy may be in order for those with a bullish position.

Beans – The bean market continues to slip to the low end of its trading range, Jan beans touching $8.58 on Friday.  Keeping in mind the contract low is $8.57, we are dangerously close to making new contract lows.  Unfortunately, I don’t believe the market is supportive enough to keep it from breaking through and it will be interesting to see where we find support in the event of a bearish report.  On the bullish side, weather can become a factor in Argentina or Brazil.  With all the negative news, and positive news can be very impactful.

For Fun
As I drive through Fremont, NE I see a huge parking lot of shipping containers.  It has always intrigued me to see what people make from these things.  I have seen outdoor bars, to cabins.  But little did I know there are people that build complete homes and offices from shipping containers!  Seems crazy, almost like a bad idea, but turned out some are quite impressive.  Then I ask myself, did they actually save any money at all!  I would think the small lake cabins yes, but the huge structures, I would think they spent more?  None the less, cool to see what people create!  Popular Mechanics did a good write up if you are interested http://www.popularmechanics.com/home/how-to/g172/shipping-container-homes-460309/

Greg Mockenhaupt

ProEdge Risk Management Consultant

P: (402) 685-5613 | Greg.Mockenhaupt@cvacoop.com

1007 County Road O

Oakland, NE 68045