USDA Crop Report

News & commentary on the USDA Crop Report and Grain Futures markets including wheat, soybeans, corn & more

USDA Crop Report is a blog dedicated to bringing updates, news and commentary on the USDA Crop Report and the grain futures markets including wheat, corn, soybeans and more.

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12/18/2014 Corn buy signal

Posted on 12/18/2014 1:16:50 PM by: Larry Baer, Market Strategist @ Zaner. 312-277-0112.

Call me for trade

 

 


NO UPDATE TODAY

Posted on 12/18/2014 7:21:09 AM by: Rick Alexander, VP, Trading @ Zaner. 312-277-0107.

WE HAVE A VERY GOOD HEDGING DEPARTMENT HEADED BY TED SEIFRIED. WHY NOT TALK TO HIM OR ANY OF OUR OTHER HEDGING BROKERS. NO ONE WILL PRESSURE YOU AND WHAT HAVE YOU GOT TO LOSE? I'VE BEEN A LICENSED FUTURES BROKER FOR 41 YEARS AND TRUST NO ONE MORE THAN TED AND HIS GROUP.

Higher for oats, Minneapolis, Kansas City and Chicago wheat while lower for corn, rough rice, soybeans, soybean meal and soybean oil. Times have finally changed for the wheat complex that could be seen starting to happen back in November.  All wheat made their best highs since August for Minneapolis and KC while June for Chicago before settling well off their highs. Today's action was precipitated by export restrictions in Russia.  Generally, rallies off this kind of news are somewhat short lived. I'm now looking for a close over 650 for Minneapolis and 660 KC to keep it going. Chicago has already taken out my next price area. The Minneapolis/ KC spreads settled sharply lower now at the area I feel you can begin putting them on going for 10-15 cents. It seems to be forming a possible huge bottom but are in an area where they've stalled out in the recent past. I really want to see a close above even money to get bullish but you can buy them under -20 and wouldn't have more than a twelve cent (close) risk in my opinion. Oats settled slightly higher again with heavy resistance looming around 325 and up making this grain not worth trading at this time in my opinion. Also, my sell signal remains in place. Rice could be bottoming but were seriously hurt by today's sharply lower close while still is in downtrend overall. Like oats, I feel it's best to stand aside unless you want to buy against a close below1200 or 1180.The bean complex settled down again with spreaders selling the beans against wheat and to a lesser extent corn today. You can see below that the beans and meal have been consolidating since late October  So I would use 1080 and 1000 for the bean parameters and 370 along with 340 for the meal. Look for breakouts in either direction for a sign which way they might eventually go. On the other hand oil just looks bearish with tremendous resistance overhead as you can see below. BUY SIGNALS FOR MINNEAPOLIS, KANSAS CITY AND CHICAGO WHEAT ALONG WITH CORN AND SOYMEAL. SELL SIGNALS FOR OATS, ROUGH RICE, SOYBEANS AND SOYBEAN OIL.. CALL FOR DETAILS.  For additional charts, quotes, news,

  

  

  

 

  

 


NO UPDATE TODAY

Posted on 12/18/2014 7:21:00 AM by: Rick Alexander, VP, Trading @ Zaner. 312-277-0107.

WE HAVE A VERY GOOD HEDGING DEPARTMENT HEADED BY TED SEIFRIED. WHY NOT TALK TO HIM OR ANY OF OUR OTHER HEDGING BROKERS. NO ONE WILL PRESSURE YOU AND WHAT HAVE YOU GOT TO LOSE? I'VE BEEN A LICENSED FUTURES BROKER FOR 41 YEARS AND TRUST NO ONE MORE THAN TED AND HIS GROUP.

Higher for oats, Minneapolis, Kansas City and Chicago wheat while lower for corn, rough rice, soybeans, soybean meal and soybean oil. Times have finally changed for the wheat complex that could be seen starting to happen back in November.  All wheat made their best highs since August for Minneapolis and KC while June for Chicago before settling well off their highs. Today's action was precipitated by export restrictions in Russia.  Generally, rallies off this kind of news are somewhat short lived. I'm now looking for a close over 650 for Minneapolis and 660 KC to keep it going. Chicago has already taken out my next price area. The Minneapolis/ KC spreads settled sharply lower now at the area I feel you can begin putting them on going for 10-15 cents. It seems to be forming a possible huge bottom but are in an area where they've stalled out in the recent past. I really want to see a close above even money to get bullish but you can buy them under -20 and wouldn't have more than a twelve cent (close) risk in my opinion. Oats settled slightly higher again with heavy resistance looming around 325 and up making this grain not worth trading at this time in my opinion. Also, my sell signal remains in place. Rice could be bottoming but were seriously hurt by today's sharply lower close while still is in downtrend overall. Like oats, I feel it's best to stand aside unless you want to buy against a close below1200 or 1180.The bean complex settled down again with spreaders selling the beans against wheat and to a lesser extent corn today. You can see below that the beans and meal have been consolidating since late October  So I would use 1080 and 1000 for the bean parameters and 370 along with 340 for the meal. Look for breakouts in either direction for a sign which way they might eventually go. On the other hand oil just looks bearish with tremendous resistance overhead as you can see below. BUY SIGNALS FOR MINNEAPOLIS, KANSAS CITY AND CHICAGO WHEAT ALONG WITH CORN AND SOYMEAL. SELL SIGNALS FOR OATS, ROUGH RICE, SOYBEANS AND SOYBEAN OIL.. CALL FOR DETAILS.  For additional charts, quotes, news,

  

  

  

 

  

 


EXPORT RESTRICTIONS IN RUSSIA THE MAIN NEWS FOR WHEAT.

Posted on 12/17/2014 7:38:29 AM by: Rick Alexander, VP, Trading @ Zaner. 312-277-0107.

WE HAVE A VERY GOOD HEDGING DEPARTMENT HEADED BY TED SEIFRIED. WHY NOT TALK TO HIM OR ANY OF OUR OTHER HEDGING BROKERS. NO ONE WILL PRESSURE YOU AND WHAT HAVE YOU GOT TO LOSE? I'VE BEEN A LICENSED FUTURES BROKER FOR 41 YEARS AND TRUST NO ONE MORE THAN TED AND HIS GROUP.

Higher for oats, Minneapolis, Kansas City and Chicago wheat while lower for corn, rough rice, soybeans, soybean meal and soybean oil. Times have finally changed for the wheat complex that could be seen starting to happen back in November.  All wheat made their best highs since August for Minneapolis and KC while June for Chicago before settling well off their highs. Today's action was precipitated by export restrictions in Russia.  Generally, rallies off this kind of news are somewhat short lived. I'm now looking for a close over 650 for Minneapolis and 660 KC to keep it going. Chicago has already taken out my next price area. The Minneapolis/ KC spreads settled sharply lower now at the area I feel you can begin putting them on going for 10-15 cents. It seems to be forming a possible huge bottom but are in an area where they've stalled out in the recent past. I really want to see a close above even money to get bullish but you can buy them under -20 and wouldn't have more than a twelve cent (close) risk in my opinion. Oats settled slightly higher again with heavy resistance looming around 325 and up making this grain not worth trading at this time in my opinion. Also, my sell signal remains in place. Rice could be bottoming but were seriously hurt by today's sharply lower close while still is in downtrend overall. Like oats, I feel it's best to stand aside unless you want to buy against a close below1200 or 1180.The bean complex settled down again with spreaders selling the beans against wheat and to a lesser extent corn today. You can see below that the beans and meal have been consolidating since late October  So I would use 1080 and 1000 for the bean parameters and 370 along with 340 for the meal. Look for breakouts in either direction for a sign which way they might eventually go. On the other hand oil just looks bearish with tremendous resistance overhead as you can see below. BUY SIGNALS FOR MINNEAPOLIS, KANSAS CITY AND CHICAGO WHEAT ALONG WITH CORN AND SOYMEAL. SELL SIGNALS FOR OATS, ROUGH RICE, SOYBEANS AND SOYBEAN OIL.. CALL FOR DETAILS.  For additional charts, quotes, news,

  

  

  

 

  

 


Will Corn Exports Increase if China Approves?

Posted on 12/16/2014 2:50:05 PM by: Ted Seifried, VP, Ag Hedging @ Zaner. 312-277-0113.

Corn exports so far this marketing year have been disappointing given the relatively low price and record crop.  Export sales have been better in recent weeks, but are still well below levels needed to hit the USDA projections.  There is some hope that corn exports will pick up later in the marketing year.  Now that China has finally approved Syngenta's MRI 162 (or is in the process of doing so) will this mean an increase in US export sales for corn?
 
So far this marketing year, which began in September, export sales for corn have been a bit disappointing.  Marketing year to date we have sold 933.5 million bushels of corn compared to 1.011 billion at this time last year.  For low prices and a record crop this is a bit disappointing.  However, the argument has been made that with a record pace of soybean sales and shipments the ports are clogged with soybeans and the corn shipments will come later.  There is a big hole in this argument though, marketing year to date we have shipped 391 million bushels compared to 317 million bushels at this time last year.  So, we have sold less corn then last year but shipped more.  This means that there is no problem shipping corn, but we are not selling it as quickly.
 
Part of this may be due to the oddly timed rally in corn prices.  the current low in corn came on October first as we were in the beginning stages of harvesting a record corn crop.  Generally speaking we would expect to be making new lows at least until we were almost done with harvest.  Global buyers may have been surprised by this as well and may now be looking for prices to come down again before becoming more aggressive buyers again.
 
In the last few days there has been new reason to hope for more robust corn exports despite prices over 75 cents off lows.  For one, Ukraine confirmed that there have been disruptions in corn intended for China.  This could mean that Ukraine may not be able to fill a portion of it's export commitments and may mean the US gets more export interest from China.  What we do not know is how much corn or for how long these disruptions in the Ukraine will effect their commitments to China.
 
With China now moving to approve MRI 162 (the strain that caused so many cargo rejections in the last 12 months) it seems that China is concerned that then may need to be looking to the US to fill some of their corn needs.  At the very least it seems they are looking to be buyers of our DDGs.
 
It will be interesting to see how corn exports look over the next couple of weeks.  It may be the case that China will come in as a big buyer and push prices higher.  This could also motivate other global buyers to get in before the price goes too high.  Strong China corn purchases could have a snowball effect on the global corn market.  However, if these big china purchases never materialize and export sales continue to fall flat, corn could need to use lower prices to go hunt for more export business.
 
Feel free to give me a call or shoot me an email if you would like to talk about your marketing plan, the markets, weather, or just to visit.  Also, follow me on twitter @thetedspread if you like. 
 
March Corn Daily chart:

January Soybeans Daily chart:

March Wheat Daily chart:

All this means that speculators should be looking for opportunities and producers need to look to lock up some prices. Give me a call for some ideas. In particular, producers looking to hedge all or a portion of their production may be rather interested in some of the options / options-futures strategies that I am currently using.

In my mind there has to be a balance. Neither technical nor fundamental analysis alone is enough to be consistent. Please give me a call for a trade recommendation, and we can put together a trade strategy tailored to your needs. Be safe!

Ted Seifried (312) 277-0113 or tseifried@zaner.com

Additional charts, studies, and more of my commentary can be found at: http://markethead.com/2.0/free_trial.asp?ap=tseifrie


Grains Markets may not be Buying USDA Ending Stocks

Posted on 12/16/2014 1:29:59 PM by: Ted Seifried, VP, Ag Hedging @ Zaner. 312-277-0113.

 
Grain markets, specifically corn and soybean markets are taking the current USDA ending stocks projections with a grain of salt.  In the December USDA WASDE (World Agricultural Supply and Demand Estimates) the USDA trimmed ending stock estimates for corn and soybeans but still suggested very large ending stocks figures.  However, grains traders remember very well what ended up happening to the large corn and soybean estimates from this time last year and are cautious to buy into the big ending stocks concept.
 
On the December 2014 USDA WASDE report the USDA estimated ending stocks for corn at just under 2 billion bushels at 1.998 billion, and soybean ending stocks at 410 million bushels.  If realized these would be some of the largest corn and soybean stocks we have seen in recent history.  This is not a surprise considering the USDA is reporting record crops of corn and soybeans last year.  However, the trade also remembers that at this time last year the USDA was expecting big ending stocks but when all was said and done ending stocks were much smaller then the December estimate.
 
On the December 2013 USDA WASDE report the USDA was expecting a corn carry over of 1.792 billion bushels and soybean ending stocks of 150 million bushels.  However, final ending stocks for the 2013/2014 marketing year cane in at 1.236 billion bushels for corn and only 92 million bushels for soybeans (which means we effectively ran out of soybeans).  The reason for this is that the USDA was sharply underestimating export demand for both corn and soybeans.  In the December 2013 report the USDA was estimating corn exports at 1.450 billion bushels and the final number was 1.917 billion.  That means that corn exports were 467 million bushels stronger then expected!  That is A LOT of corn.  For soybeans the USDA was estimating 1.475 billion bushels of soybean exports the final number came in at 1.647 billion.  Here too exports were significantly stronger then originally expected and in both cases this added up to much smaller then expected ending stocks.
 
For this year the USDA is looking for even bigger ending stocks then they were at this time last year but, the trade is wondering if the same sort of thing can happen again.  The thought is that with cheaper prices this year demand as a whole may be even stronger and cut the big ending stocks numbers back down again.  So far export sales for soybeans have been stronger then the record pace set last year.  However the USDA is looking for export sales to increase by 113 million bushels as part of their current balance sheet.  This means that the strong export sales we have seen in soybeans so far this marketing year will have to keep up for some time.  While this is possible it seems likely that much of the export sales will shift to South America later in the year as long as they have a good crop and can get it shipped out in time.
 
Corn export sales have not been as good so far this year.  The USDA is already looking for a year over year reduction in export sales but we are still below the pace needed to hit the USDA target.  This is a concern because after having a record corn crop and having relatively low prices we would expect export sales to be very strong at this point.  What has been strong for corn is corn used for ethanol production.  On a weekly basis we have been well over the average needed to hit the USDA projection for the last 5 weeks.  While this might not make up for lower exports if the pace does not pick up it could offset much of it.  However with crude oil prices falling we have to wonder how long ethanol demand can stay strong given the fact that is getting less competitive with unleaded gasoline.
 
The bottom line is that the grain markets are currently taking the large ending stocks projections with a grain of salt.  With the unexpected and sharp increase in demand last year the trade is choosing to take more of a wait and see attitude this year.  But, this does not mean with certainty that ending stocks will fall by the end of the marketing year either.  The key here may well be South America.  If South America gets through their growing season without much issue it could mean that global demand shifts to South American grain later in the year and that USDA projections could be close to reality.  However, if South America has any issues more global demand may need to get filled with US grain tightening ending stocks dramatically.  So, for now we may wait to get a better feel on South American the South American crop and export/ethanol demand before we really buy into the big USDA ending stocks numbers.
 
Feel free to give me a call or shoot me an email if you would like to talk about your marketing plan, the markets, weather, or just to visit.  Also, follow me on twitter @thetedspread if that is your thing. 
 
March Corn Daily chart:

January Soybeans Daily chart:

March Wheat Daily chart:

All this means that speculators should be looking for opportunities and producers need to look to lock up some prices. Give me a call for some ideas. In particular, producers looking to hedge all or a portion of their production may be rather interested in some of the options / options-futures strategies that I am currently using.

In my mind there has to be a balance. Neither technical nor fundamental analysis alone is enough to be consistent. Please give me a call for a trade recommendation, and we can put together a trade strategy tailored to your needs. Be safe!

Ted Seifried (312) 277-0113 or tseifried@zaner.com

Additional charts, studies, and more of my commentary can be found at: http://markethead.com/2.0/free_trial.asp?ap=tseifrie


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