Friday, June 5, 2009

Friday, June 5 2009

General Highlights Today:
· Stronger Dollar held grains markets from moving higher today.
· July crude oil was down $.37 barrel to close at $68.44 a barrel.
· US dollar index was 1.278 points higher, at 80.692 at 2:26 CDT.
· The Dow was up 24 points to 8,774 at 2:21 CDT.

Today the corn market was relatively quiet as we traded in a 6 cent range, for the week corn was up about $.08. From that respect it looks like a quiet week until one looks Wednesday and Thursday when we switched from -$.17 to up $.165! The stronger dollar and profit taking going into the weekend kept corn futures on the defensive. One news story largely ignored today was a University of Illinois projection of a 148.6 bushel per acre national yield, if realized this would indicate a 600 mbu carryout or so for next year. The current market is bringing to light the battle of the toll on livestock producers as rumors are beginning to increase that many may be forced out of the livestock business due to heavy losses. So much for the 600 mbu carryout... Commodity funds were estimated to be net sellers of 4,000 contracts of corn. Rain events for much of the Midwest this weekend are predicted with amounts ranging from 1 to 2 inches. Most traders view these rains as beneficial.

Soybeans futures traded lower today on a stronger US Dollar and expectations that USDA will increase new crop acreage in the Supply and Demand estimate coming out on Wednesday the 10th. For the week July soybeans gained $.41 while new crop was essentially unchanged as the market deals with the expectations of short supplies of old crop beans due to strong exports and now domestic usage and the expected increase in acreage. Profit taking was also noted in today’s trade as funds were estimated net sellers of 2,000 contracts soybeans,1,000 contracts of soybean meal, and 2,000 contracts of soybean oil.

Have a great weekend, Phil Farrell

Thursday, June 4, 2009

Thursday June 4th, 2009

Renewed enthusiasm about the economy helped commodities erase much of their loses from yesterday, with corn closing up 16 and old crop soybeans closing up 48 cents. Crude oil and gold also finished the day stronger, crude up over $2.50 a barrel. U.S. Labor Department reported on Thursday that the number of unemployed workers continuing to receive benefits unexpectedly dropped last week for the first time in 20 weeks, new jobless claims also declined. Unemployment continues to be one of the most closely watched gauges of the recession recovery. Funds were reported buyers of 4,000 corn and 5,000 soybean contracts. Export sales showed corn at 25.9 million bushels for the week and soybeans 1.3 million bushels.

Chris Spurlock

Wednesday, June 3, 2009

Wednesday, June 3rd 2009

An all out collapse in the grain markets today as funds and producers were large sellers. The wheat market dn 52 cents led the way as the speculative crowd that has dominated the trade lately exited in large quantities relative to their position. Minneapolis wheat did close at limit down 60 cents today. Crude oil ended the day down $2.31 and was down over $3.00 as the ag futures closed. The US dollar was sharply higher today and that also led to the lower grain markets. The weather forecast is confusing as moisture is good for the 95% planted in mostly wet conditions but also may be the final straw in what's left to plant and may force some to switch to soybeans. The USDA report next week may not adjust planted acreage and leave the door open for an exciting June 30th report.

An interesting note to compare the wet spring of this year vs last year, in the June USDA report last year corn production per acre was lowered 5 bushels due to the extreme flooding and late start to planting. It will be interesting to see if bu/ac are also lowered from the 155 that the USDA is using this year.

Funds were sellers of 14,000 contracts of corn leaving them long 200,000, they sold 5000 soybean contracts down to 125,000, and 10,000 contracts of Chicago wheat leaving them 12,000.

Scott Meyer

Tuesday, June 2, 2009

Tuesday June 2, 2009

Grains in Chicago closed a mixed note today. With corn closing up 3 3/4 cents and soybeans losing 9 1/2 cents. All of this in low volume trade until funds came in with closing buy orders in the corn pit. In outside markets a few items of note as the dollar index has sustained trade below support at 80Pt's. Counteracting that is meat complex's lack of any signs of buoyancy.

Corn seems to be favoring the energy side of the equation. This building confidence in corn demand as the funds have nearly tripled their corn position in the last 30 days. Technical support for July Corn is found at the 20 day moving average at 4.25 basis July Futures. Crop Conditions on the surface look bearish although, a relatively generic way to guess final yield this early in the game. Trade looking into next weeks USDA Supply and Demand Report with hesitation to press the downside.

Soybeans consolidating after huge gains yesterday. We are seeing some pressure on old crop soybean premiums as rumors of business switching to new crop are circulating. This leading funds to lock a few profits in especially after July/Nov hit the old 2004 barrier at +1.70.

Jeff Neisler

Monday, June 1, 2009

Monday June 1, 2009

The recent steep decline in the dollar is generating uneasiness regarding the state of the US currency and the huge debt loads being taken on by the Federal Government.This in turn is reversing the "flight to quality" mentality of late 2008 and early 2009 that originally pushed the dollar sharply higher. Now it seems like the large traders and investors are looking for a new "safe" place to to park some money, and commodities seem to be an obvious choice.Today's rally has clearly came in the lower directionally based dollar with a major assist coming from $2 a barrel higher crude oil prices.
Futures in corn beans and wheat were all higher today with corn being up 9-10 cents
beans new crop up 24 and old crop July up 34, followed by the wheat up 32-37 cents on the day. Winter wheat condition isn't much different than last week pegged at 45% good to excellent. Spring wheat is 89% planted compared to 98% average and 67% emerged compared to 90% average. The spring wheat is 73% good to excellent compared to 57% last year.
Crop planting progress was about as expected with 93% of the corn planted compared to an average of 97%. 73% of the corn was emerged compared to 86% average. USDA also released its first crop conditions rating pegging the corn crop at 70% good to excellent.The crop progress on was 66% planted compared to an average of 79% with the emergence at 36% versus 30% last year and 51% average.

Chuck Peterson