Market Report


S&P -1.13
Nasdaq +7.14
Dow +15.00

Stocks struggled for direction in light trading Today, bouncing in and out of positive territory. Traders said few shares were changing hands, due to both the upcoming holiday weekend and a busy investor conference schedule. http://www.wsj.com/articles/global-stocks-down-after-g-7-finance-meeting-ends-in-deadlock-1463989995

 

Grain Markets 11:20am

July Corn +3’0@3.97’4
Dec Corn +3’0 @ 4.02’6
July Beans -13’0 @ 10.61’2
Nov Beans -14’0 @ 10.35’4

 

USDA planting progress report due out this afternoon 3pm.

 

Corn seeing some strength this am as concerns of weather have slowed corn planting and there is talk of acres being switched to beans.  Beans seeing some weakness as well as soy oil and soy meal.  We will need to see how it plays out over the next couple of weeks.  Demand for corn remains strong in both exports and ethanol.

Looking forward weather may be the story, but so is money flow.  As the U.S Dollar finds it difficult to gain traction the funds are interested in commodities.  Commodities seems to have found the bottom and support has come back into the equation.

 

Beans have had a significant rally caused by fund buying.  This also means the fund hold a significant “long” position.  As a consideration, these fund will eventually roll or exit.  Unless there are significant buyers, the market will feel the negativity of substantial selling.

 

Looking forward weather and acres will still be a debate and political concerns in Brazil are still a factor, both of which stand to provide bullish news.  However one has to consider the negative fundamentals overall.  That being said there are 2 sides to every story.  Sound risk management principles will be key to maximizing a rally.

 

Weather – Chance of rain every day this week.

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Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

USDA Report


July Corn +10 ½ @ 3.79 ½

July Beans +51 @ 10.77 ½

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Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

Market Report


Markets 11/16/15 12:02pm

Dow +100.31
S&P +11.42
Nasdaq +10.73

I am sure you heard of the terrible attacks in Paris killing at least 129 people.  After an initial wobble, financial markets mainly shrugged off the effects of Friday’s terrorist attacks in Paris, underscoring how investors increasingly look beyond these type of events, so it seems.

Grain Markets 11/16/15 12:08pm

Dec Corn +0’6 @ $3.59’0
Jan Beans +2’0 @ $8.57’2

 

With harvest pretty much wrapped up we have little news from the U.S. that can change the markets now.  We know what we have, weather is now not much concern.  Oil continues to grind lower and the US dollar keeps creeping up.  The odds keep stacking against grains.

 

Corn lower on the open despite good exports, good news and the markets doesn’t seem to care.  Corn has not given us too much excitement by way of headlines and with little change from the USDA the only thing to look forward to is a weather story out of South America or some sort of geopolitical event.  As I mentioned in a text last week the tight trade range has got me nervous.  I suspect we will continue to grind lower (lower highs/lower lows) until we receive some sort of positive news.  I think $3.50 in the cards, possibly breaking through and heading toward $3.40.  I hope we find some support or a headline before we head lower.  I will add if oil prices continue to stay low, it pressures ethanol demand.

 

Beans the focus is now South American Production and demand from China.  Also hoping for a weather story out of South America to boost our opportunities for a sale.  The strength in the US dollar is going to remain a variable in export sales.

 

Exports

EXPORTERS SELL 952,500 METRIC TONNES OF CORN FOR DELIVERY TO MEXICO DURING THE 2015/2016 MARKETING YEAR- USDA

EXPORTERS SELL 487,680 METRIC TONNES OF CORN FOR DELIVERY TO MEXICO FOR 2016/2017 DELIVERY- USDA

EXPORTERS SELL 180,000 METRIC TONNES OF SOYBEANS FOR DELIVERY TO CHINA FOR 2015/2016 DELIVERY- USDA

 

Strategy:  When you opt to sell cash grain, it is always an option to buy a call to participate in upside potential.  This in effect puts in a floor with upside.

 

For Fun: So you may recall I mentioned previously that Ferrari (Ticker “RACE”) went public.  For the early adopters it hasn’t fared well.  Opening up at $60 a share, now grinding down to a low of $48.83, the luxury car maker has received a $40 price target from Evercore.  None of this means anything to me, and I don’t know any farmers with a Ferrari, but for $40 my two boys might just get a share for Christmas, why?  Well it’s just cool to own Ferrari, that’s why.

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Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

Grain Market Report


With harvest underway, I want to say thank you for your business, and be careful.  I have also put together a brief email for markets this week containing important relevant info, as I know time is limited.  (Clients receive newsletter and recommendations)

 

Grain Markets – It was exciting this morning when beans rallied above $9.00 actually posting a $9.04.  A close above $9.02 would give us enough momentum to continue upwards.  I will also add the East Hub and area CVA elevators have has a 2 cent basis improvement on beans.  This was a bit of a surprise to me and expect it to be short lived, given so many elevators are already full.  Corn remains fairly range bound on the day.  USDA planting progress report is out today (due to Columbus Day).

 

9:32am

Corn even $3.81

Beans +13’6 @ 9.01’2

 

Weather – looks good for harvest!

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Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

US Stock Report


US STOCKS SEPT 1

CORN 1.731 BLN BU (TRADE ESTIMATE 1.739 BLN)

SOYBEANS 0.191 BLN BU (TRADE 0.205 BLN)

WHEAT 2.089 BLN (TRADE 2.149 BLN)

2014 US SOYBEAN CROP REVISED TO 3.927 BLN BUSHELS FROM 3.969 BLN-USDA

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

Market Report


Dow +121.27
S&P +13.19
Nasdaq +35.25

Global stock markets climbed today, rebounding from heavy losses last week after the Federal Reserve left interest rates on hold.  The Dow Jones Industrial Average gained 87 points, or 0.6%, to 16471 in early trade. The S&P 500 also rose 0.6%, after both indexes declined sharply on Friday.  The markets steadies after the Fed decision, though many people debating whether the Fed is going to raise rates yet this year.  We are most likely in for a period of choppy markets.

Commodities: Gold prices jumped after the Federal Reserve’s decision a day ago to hold interest rates steady, Prices for the metal, which have lost more than 7% in the past year and have been bumping along five-year lows, touched their highest level in more than two weeks on Friday, gaining $20.80, or 1.9% to settle at $1,137.80 a troy ounce on the Comex division of the New York Mercantile Exchange.  The gains weren’t limited to gold. Silver rose 1.2% to $15.163 an ounce, its highest level since late August. Platinum gained 1.6% to settle at $984.40 an ounce, and palladium rose 1.9% to settle at $610.85 an ounce.

Weather:image001

Dec Corn +1 ¾ @ $3.79
Nov Beans+5 ¼ @ $8.72 ½ 

Since last week we have seen grain markets lose some ground.  With our high of the week coming in on Tuesday at @ $3.95 for Dec corn and $8.94 for Nov beans.  With a wide open week for harvest in many parts of the Midwest, it seems good harvest conditions pressure grains, despite good export numbers this am.

EXPORTERS SELL 487,680 TONNES U.S. CORN TO MEXICO FOR 2015/16 DELIVERY – USDA

EXPORTERS SELL 240,000 TONNES U.S. SOYBEANS TO UNKNOWN DESTINATIONS FOR 2015/16 DELIVERY – USDA

 

Corn: Corn was a 2 sided trade this am opening lower, but pushing higher by 9am.  Little to report as far as fresh news, conditions for harvest seem to be moving right along, wet corn programs popping up around as some producers get an early start.  Ethanol remains steady, and exports can be debated (knowing there are cheaper supplies in South America).  Also the feed and residual can be a variable to give us some movement.  But without a story, we are likely to see corn push lower into harvest.

Beans:  Beans continue getting beat down by the same thing….dollar higher, Brazilian acres, uncertainty in China.  At some point the story gets old, and traders move on.  Not saying we will see a rally, just saying we need something more to make a new low than the same stories, with $8.53 ¼ being the bottom for the November contract.  Seems like beans are happy in the range of $8.65-$8.94 as they have been since Aug 25th.  At least until the story comes!

For Fun:With the Christmas season fast approaching………ha ha….got you!  It’s not even Halloween yet!  But for some reason we are all seeing Christmas stuff in the stores.  Every year I catch myself saying….I swear it’s earlier each year.  Referred to as the “Holiday Creep” stores have been pushing Christmas displays and promotions into stores earlier and earlier each year.  So this is a real thing?   I walked into a store in Lincoln this weekend to see Christmas trees……

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In 2011 Walmart launched it “holiday layaway program” a month early (in mid-October), and now in 2015 Walmart launched it in August!  Kmart airing its first Christmas commercial last year in September, so get ready for the Christmas toy commercials.  Yikes!  I personally enjoy Christmas, but I am tired of it before it even gets here.  I mean really, Christmas?  I haven’t even bought my trick or treat candy yet…..know why?  It not even October yet…..

 

But consumers are to blame, apparently enough get excited and start buying.  Retailers only begin early because it increases sales, so crank the Christmas tunes and head on over to your local store and pick up a zombie mask, a Christmas tree, and a gallon of milk.

 

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

Market Report


Informa September

Corn  168.8 bu/ac  13.688 bil bu

Soybeans  47.0 bu/ac  3.924 bil bu

 

FCStone September

Corn  Yield 165.9, Production 13457

Soybeans Yield 45.4, Production 3791

 

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

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

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

USDA Report


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*Yield was left unchanged, but will be updated in the August S&D report

**Acres were pulled from the June 30th Planted Acreage report

 

CORN

The friendly June 30th Stocks report allowed the USDA to raise old crop feed demand 50 mbu this month. Combined with increases in ethanol (+25 mbu) and exports (+25 mbu), improved demand shrunk the 14/15 carryout by 97 mbu. The new crop balance sheet saw the USDA leave yield estimates unchanged, noting that updates would be available in their August 12th report. Acreage numbers were pulled from the June 30th acreage report, so the reduction in harvested acres allowed production estimates to decline 100 mbu for new crop corn. New crop demand projections saw feed (-25 mbu) and exports (-25 mbu) reduced, while ethanol added 25 mbu. The net effect was a reduction to the new crop carryout of 172 mbu – the market was looking for a little bit more. Our Take: The market is trading its own yield ideas right now, so the USDA leaving their number unchanged had little impact to the trade. It will be difficult to get an accurate feel on the national yield until we see the USDA’s thoughts on August 12th. Until then, crop ratings and the weather forecast through pollination will dictate whether we go higher or lower. The funds are supporting the market right now, which continues to push corn higher.

 

SOYBEANS

The old crop soybean balance sheet saw demand continue to work higher with crush and exports each adding 15 mbu on Friday. The June 30th stocks report confirmed a tighter soybean situation that some suspected, which resulted in a 44 mbu increase to residual demand. This essentially means that the USDA overestimated the size of last year’s crop and they are accounting for it here. The result was a 75 mbu reduction to the old crop carryout. New crop saw acreage ideas come straight across from the acreage report in June, while yield was left untouched and will await August revisions. The higher acres from June bumped production higher (+35 mbu), but a smaller carry-in and an increase to crush demand (+10 mbu) led to a net reduction in the carryout by 50 mbu. However, at 425 mbu, the estimate was higher than pre-report thoughts. Our Take: The soybean market has acreage and yield questions right now, even after the updated acreage numbers in June. Until the USDA updates their thoughts on both of these categories, the market should stay supported. There seem to be too many question marks with soybeans right now to push them aggressively lower. 

 

At the close of trading today:

CORN:   +6’0                       $4.34’4

SOYBEANS: +4’0               $10.30’2

WHEAT: -8’0                       $5.71’2

 

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

P: (402) 685-5613 | C: (402) 380-9855 | Greg.Mockenhaupt@cvacoop.com

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

Quarterly Grain Stocks Report


The USDA released their Quarterly Grain Stocks report Tuesday morning. This report measures grain in all positions as of June 1st. It is used to benchmark feed demand and gauge whether or not any adjustments are needed to the size of last harvest’s crop. Below is a summary of the estimates:

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CORN

Corn in all positions totaled 4.45 bbu, up 595 mbu from the year prior (+15%). Of that total, 2.28 bbu were contained on farm (51.3% of total) which is up 22% from the year prior. Off farm stocks totaled 2.17 bbu, up 9% from last year. Disappearance for the March-May period came in at 3.30 mbu, up from 3.16 mbu a year ago (+4.4%). Editor’s Note: Though disappearance was higher year over year, the extent of the gains is likely not enough to justify the USDA’s current corn for feed estimate. However, many thought the number would be larger than what was actually reported, so the news is being digested as bullish.

 

SOYBEANS

Soybeans in all positions as of June 1 totaled 625 mbu vs 405 mbu the year prior (+54.3%). Of the total 246 mbu remained on farm (39.4% of total) which was up 126% from a year earlier! Off farm stocks were up 28% from last year at 379 mbu. Disappearance for the March – May quarter was 701 mbu, an increase of 19% from a year ago. Editor’s Note: Soybean stocks were tighter than expected, which implies that last year’s crop size was certainly overstated. The news is no doubt friendly, and should produce an old crop carryout under 300 mbu (it was projected at 400 mbu+ last harvest!!!!).

 

WHEAT

Wheat in all positions was listed at 753 mbu, above trade stiamtes of 718 mbu. The total was 28% higher than a year ago with 155 mbu of the total contained on farm (+60% y/y). Off farm stocks were up 21% vs last year at 597 mbu. Disappearance for the final quarter of the wheat marketing year was 388 mbu, down 17 percent from last year’s pace. Editor’s Note: Of the three commodities, wheat received the most neutral to bearish information. Positive price action is likely a reflection of strength in corn.

 

 

The Planted Acreage report is survey based and is conducted during the first 2 weeks of June. It shows planted acres for principal crops across the US and is a close estimate to what final acreage should be. However, the USDA has the ability to re-survey these acres if they feel the results may have changed between the survey time period and now. Below is a summary of the numbers.

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CORN

Corn acreage came in at 88.9 mln acres vs expectations of 89.3. Acres are the lowest since 2010, down 2% from last year. Editor’s Note: The acreage numbers didn’t contribute as much to the bullishness as the Stocks report did. Many expect the USDA to resurvey acres due to the wet weather out east. So today’s numbers likely weren’t going to mean much to the trade anyway. If the USDA decides to resurvey, the results will be available in the August S&D report.

 

SOYBEANS

Soybean planted acres were listed at 85.1 mln, up 2% from a year ago and an all-time record for soybeans. Record acres were noted in MN and WI out of the Midwest. Editor’s Note: As with corn, the key numbers today were contained in the Stocks report. Market direction from here will be focused on developing crop condition and getting a handle on just how many acres were lost due to flooding.

 

WHEAT

All wheat planted acreage was listed at 56.1 mln acres, down slightly from last year (-1%) but up from the March intentions number of 55.4 mln. Wheat followed the other commodities higher, but received the least amount of bullish information from the acreage numbers.

 

The markets have responded favorably to the numbers:

As of 12:53 PM

Sept Corn +25 @ $4.16

Aug Beans +45 @ $10.39

 

Greg Mockenhaupt

ProEdge Risk Management Consultant

P: (402) 685-5613 | C: (402) 380-9855 | Greg.Mockenhaupt@cvacoop.com

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

USDA Report


USDA Report released today at 11am and the reaction was quite the show.

 

Beans

Beans traveled from -12 back to +12 in less than 5 seconds.  The amount of volatility was neat to see.  The day started with beans down anticipating an acreage increase.  Turned out the opposite sending beans up to 9.81.  Bean stocks up 34% from March last year, beans acres up but still a new high.

 

Corn

Corn started this morning in the green anticipating unchanged acreage or a slight reduction in acres, but the report showed an increase in corn acres sending corn all the way down to a low of $3.79 ½.  Corn stocks up 11% from March last year/corn acres higher than expected.

 

USDA Numbers

                                USDA                    Avg Est                 Last Year

Corn                      89.199                   88.731                   90.597

Soybeans            84.615                   85.919                   83.701

Greg Mockenhaupt

ProEdge Risk Management Consultant

P: (402) 685-5613 | C: (402) 380-9855 | Greg.Mockenhaupt@cvacoop.com

 

 

 

1007 County Road O

Oakland, NE 68045

www.cvacoop.com

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