Note: Corn Products in Chicago will be closed for truck corn deliveries Monday and Tuesday next week. Reopening 5AM on Wednesday, September 23, 2009.
Corn and soybean futures both fell sharply at the end of today’s trading session. Noon weather maps showed no threatening temperatures through Oct 4. Dec Corn was down 11 cents for the day, losing 2 cents for the week from last Friday’s close. Nov soybeans were down 12 cents for the day but, did manage to gain 38 cents for the week. Soybean basis levels were also under pressure to end the week as reports of harvest activity increased. Rain in the Mississippi Delta and Southeastern US has hampered harvest progress in those areas.
Cattle on feed showed a 1% drop vs. this time last year. Notably fed cattle marketings in August were 4% below last August and the lowest level for any August since recording started in 1996. Ethanol and DDGS prices were reported higher this week in Illinois (and to a lesser degree in Iowa). Along with relatively good export sales, improving margins in ethanol production should help strengthen demand for corn.
On highway diesel fuel prices dropped a little more than a cent again in this week’s report. Second week in a row prices retreated. Strong distillate stocks continue to pressure prices. Crude oil traded somewhat higher this week which could lend some support going forward.
Have a great weekend!
Mike Etienne
Friday, September 18, 2009
Fundmental Update 09/18/09
FUNDAMENTAL UPDATE:
Corn export sales are off to a decent start this marketing year, lagging the torrid record pace of two years ago, but comfortably ahead of last year. Cumulative corn sales of 537 mln bu are 48 mbu ahead of LY (including carryover and the first two weeks), comfortably in position with the USDA estimating a 350-mbu year-to-year jump to 2.2 billion bushels.
The huge soybean export sales carryover has cumulative sales 304 mbu ahead of LY at this point, with the USDA estimating exports for this year to equal last year. It should be noted that this years soybean export pace is expected to be heavily front end loaded with and expected record large South American crop expected to largely supply the world market from March forward.
Corn export sales are off to a decent start this marketing year, lagging the torrid record pace of two years ago, but comfortably ahead of last year. Cumulative corn sales of 537 mln bu are 48 mbu ahead of LY (including carryover and the first two weeks), comfortably in position with the USDA estimating a 350-mbu year-to-year jump to 2.2 billion bushels.
The huge soybean export sales carryover has cumulative sales 304 mbu ahead of LY at this point, with the USDA estimating exports for this year to equal last year. It should be noted that this years soybean export pace is expected to be heavily front end loaded with and expected record large South American crop expected to largely supply the world market from March forward.
Thursday, September 17, 2009
Thursday September 17, 2009
Good evening blog readers. Zach here, with an energy market update. After yesterday's large gains across the energy market, we closed today relatively unchanged. Most of the focus in commodities has been on equities and the dollar market, both of which closed flat, but have been the catalyst to the bullish influence this week. Yesterdays DOE report came in once again with large draws in crude and builds in both gasoline and diesel. The combination of a weak dollar and bullish crude sent the energy market up, even with considerable product builds.
Diesel
Distillates stock are at their highest level since 1983. The prospect of large gain in the short term should be limited, if the rule of supply and demand is still followed. Builds this week were 2.2 million bpd, which means usage is down over a four week average from last year by about 6.8%. With all this state the market still jumped about .07 this week thus far.
Gasoline
Gas had a small build of 500,000 bpd, which isn't much of a change from last year this time. Gas has moved about .07 this week as well, unless we get losses tomorrow, look for it to shake out in the pumps over the weekend.
Crude
Crude once again this week came in with large draws, 4.7 million bpd. Crude continues to position itself in the upper $60's to mid $70's. In the short term watch for the August high of $75 and support to be found around $68.
Zach Winter
Diesel
Distillates stock are at their highest level since 1983. The prospect of large gain in the short term should be limited, if the rule of supply and demand is still followed. Builds this week were 2.2 million bpd, which means usage is down over a four week average from last year by about 6.8%. With all this state the market still jumped about .07 this week thus far.
Gasoline
Gas had a small build of 500,000 bpd, which isn't much of a change from last year this time. Gas has moved about .07 this week as well, unless we get losses tomorrow, look for it to shake out in the pumps over the weekend.
Crude
Crude once again this week came in with large draws, 4.7 million bpd. Crude continues to position itself in the upper $60's to mid $70's. In the short term watch for the August high of $75 and support to be found around $68.
Zach Winter
Wednesday, September 16, 2009
Wednesday, September 16, 2009
So much for the frost scare of 2009?
Corn traded lower in sympathy with the soybean complex and and updated warmer weather forecast for next week. South Korea and Taiwan also passed on tenders for corn because the price was said to be too high. Commodity funds were estimated sellers of 8,000 contracts after buying an estimated 25,000 contracts yesterday.
Soybeans were lower on profit taking and weather. There was support at mid day as outside markets, energy, metals and equities were all firmer on the day.
Tomorrow the weekly export sales report will be released, Corn sales are estimated to be 25 - 35 mbu, beans 22 - 30 mbu. Also USDA will release Cattle on Feed report on Friday, estimates are 98.5% on fee with August placements at 100.9% and marketings at 95.3% vs a year ago. I would also expect that we haven't seen the last of the Frost talk by the trade, we will likely be on this on and off until October 10 or so.
Phil Farrell
Corn traded lower in sympathy with the soybean complex and and updated warmer weather forecast for next week. South Korea and Taiwan also passed on tenders for corn because the price was said to be too high. Commodity funds were estimated sellers of 8,000 contracts after buying an estimated 25,000 contracts yesterday.
Soybeans were lower on profit taking and weather. There was support at mid day as outside markets, energy, metals and equities were all firmer on the day.
Tomorrow the weekly export sales report will be released, Corn sales are estimated to be 25 - 35 mbu, beans 22 - 30 mbu. Also USDA will release Cattle on Feed report on Friday, estimates are 98.5% on fee with August placements at 100.9% and marketings at 95.3% vs a year ago. I would also expect that we haven't seen the last of the Frost talk by the trade, we will likely be on this on and off until October 10 or so.
Phil Farrell
Tuesday, September 15, 2009
September 14th, 2009
Frost Alert!!
Morning weather forecasts put cold air into the 10 day outlook with Sept 24-26 targeted with high 20's in northern belt areas of the Dakotas, Minnesota, and Wisconsin. Early forecasts also had low 30 degree weather in Northern Iowa and Northern Illinois. With this information, corn was up a dime and beans 30-40 higher. The noon forecasts started coming in around 11:30 with some predicting much colder and much more widespread cold temperatures.
The noon run had widespread freezing temps as far south as Missouri with even areas like Memphis TN getting into the low to mid 30's come Sept 24-26. Upon news of this colder forecast, funds began a massive short covering as it is expected they bought between 20-50,000 contracts of corn and up to 15,000 contracts of soybeans. Corn hit limit up of 30 cents for 5-10 minutes before finishing up 28.75 while soybeans popped up 67 cents before closing up 51. Farmer selling in the market was noted but not enough to offset the aggressive money managers who saw Dec 09 corn trade above it's 50 day moving average for the 1st time since early June.
Watch the extended weather forecasts for direction the rest of this week.
Scott Meyer
Morning weather forecasts put cold air into the 10 day outlook with Sept 24-26 targeted with high 20's in northern belt areas of the Dakotas, Minnesota, and Wisconsin. Early forecasts also had low 30 degree weather in Northern Iowa and Northern Illinois. With this information, corn was up a dime and beans 30-40 higher. The noon forecasts started coming in around 11:30 with some predicting much colder and much more widespread cold temperatures.
The noon run had widespread freezing temps as far south as Missouri with even areas like Memphis TN getting into the low to mid 30's come Sept 24-26. Upon news of this colder forecast, funds began a massive short covering as it is expected they bought between 20-50,000 contracts of corn and up to 15,000 contracts of soybeans. Corn hit limit up of 30 cents for 5-10 minutes before finishing up 28.75 while soybeans popped up 67 cents before closing up 51. Farmer selling in the market was noted but not enough to offset the aggressive money managers who saw Dec 09 corn trade above it's 50 day moving average for the 1st time since early June.
Watch the extended weather forecasts for direction the rest of this week.
Scott Meyer
Monday, September 14, 2009
Monday September 14, 2009
It was a rather quiet session to start the week as the grain markets were pulled in two directions. The market still continues to focus on the possibility of a season ending frost/freeze next weekend. The various weather models have been consistent lately in projecting colder than normal temps in the 10-12 day time frame with the debate really coming down to whether or not the temperature will drop low enough to do damage to the crop. Right now it looks as though freezing temps would remain to the far northern Midwest (N. Dakota, northern Minnesota, and northern Wisconsin) with only patchy frost seen further south into northern Illinois and Iowa.
Corn conditions this afternoon were unchanged at 69% good/excellent although the USDA did report a 1% move from good into excellent. The crop continues to lag as corn dented was at 66% vs. 76% last year and 86% on the five year average. Corn mature was 12% vs. 17% last year and 37% on average. Harvest continues to move north with good yields seen this weekend as far north as KY and southern IL.
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