Friday, December 31, 2010

Super Strong Close for Grains to end 2010

It looks like we will have the grain markets end 2010 with a bang as we made new highs and high closes for both soybeans and corn .

opening grain market comments 12-31-10

Markets are called firmer this a.m. behind a firmer over night session and a weak US dollar.

Wednesday, December 29, 2010

neutral nick update

Neutral Nick went and updated his position today; under his theory of trying to have a net delta position of 100,000 bushels sold he added positions in corn and soybeans today.

To see more on Neutral Nick check out his page  at or continue reading below

He placed the following

opening grain market comments 12-29-10

Markets are called mixed this a.m. behind mixed outside markets and a weaker overnight session.

Calls this a.m. are down 3-5 on KC and CBOT wheat, MPLS wheat unchanged to down 2, Corn is called 1-2 weaker, and beans are called down 4-8 cents.

In the overnight session MPLS wheat was off 1, CBOT wheat was down 3, KC Wheat was off 4-5, corn was unchanged, and beans where down 7.  At 9:20 outside markets have equities firmer with the DOW up 40 points, crude is off about a dime, the US dollar is weaker with the March dollar down 175 points, and European wheat is down about ½ of a percent.

Monday, December 27, 2010

Grain Marketing Principles

I seen a very good link for marketing prices, principles, and tools.  Looks like it is from K-State

I like how they assesses the pro's and con's of the various types of tools that can be used in marketing or writing a grain marketing plan.

Here is the link.

The format is done where it appears to have been a power point presentation at one time; I would guess it would have been interesting to watch and see how the interaction went.

Opening Grain Market Comments 12-27-10

Markets are called mixed this a.m. behind what is expected to be choppy trading this week. 

In the overnight session corn was down 1-2 cents, beans where up 7-9 cents, KC wheat wad down 3, MPLS wheat was down 3, and CBOT wheat was down 5-6 cents.  China raised interest rates and that had all of the grains open and trade much lower then where the overnight session left off at.  At 9:10 outside markets have the equities weaker with the DOW down about 50 points, the US dollar is weaker with the March down 172 at 80.660, crude oil is off about 80 cents a barrel, and the European milling wheat contract is nearly unchanged.

Thursday, December 23, 2010

Marketing Characters Coming

Here are some of the marketing characters that will be coming soon.

Vinny Vegas

Neutral Nick

Merry Christmas !! Grain market comments 12-23-10

want to wish all a Merry Christmas; make sure to drive safe.

Rather short comments today and no markets again until Sunday Night.

We don’t have the final settlements yet; but he grain markets just closed and it looks like we will see old crop corn up 3-4 cents, new crop Dec 2010 corn unchanged, Beans up nearly 20 cents, KC wheat up about a penny, CBOT wheat off about a penny, and MPLS wheat near unchanged.  At 1:20 outside markets have the equities near unchanged, crude is up a dollar, European wheat was up about 1/3 of a percent, and the US dollar is showing a little weakness down 243 on the March at 80.835.

I have heard many comments how this price rally this last few months has been a great Christmas gift for the producers.  However you want to look at it the price movement that we have seen to over the past 6th months is much different that most thought it would be back in early June.  Back then most where talking about how horrible the wheat prices where coming off the combine down south (where many reported getting

How to play the corn inverse?

I had someone ask me the other day what type of option move has the best chance to work with the corn inverse from July to Dec futures.

I thought about it and here is my line of thinking.

An inverted market is a market that shows a lack of supply or strong up front demand.  A carry market shows a lack of nearby need.

So under that thinking; I asked my self what type of move works if the inverse gets bigger but also has little risk if we see the inverse go to a carry.

Tuesday, December 21, 2010

quiet trading 12-21-10 in the grain markets

rather quiet choppy trading was noted in the grain markets today; the range that we seen for corn and wheat one of the smallest in some time

particularly in corn where some contracts only had a 5-6 cent range

the question is what does it mean?  Anything? 

opening comments 12-21-10

Markets are called mixed to firmer this a.m. behind choppy overnight markets and mixed outside markets.

In the overnight session corn unchanged to up a penny, KC wheat was up 4 cents, MPLS wheat was up 3 cents, CBOT wheat was up 1-2 cents, and soybeans where unchanged to up 2 cents.  At 9:15 outside markets are

Thursday, December 16, 2010

Morning Comments 12-16-10

Markets are called mixed this a.m. behind a slightly firmer overnight session along with mixed outside markets and export sales that where mixed.

In the overnight session corn was up 2, beans where up 4, KC wheat was up 2, MPLS wheat was up 2, and CBOT wheat was down 1.  At 8:50

Wednesday, December 15, 2010

market comments from 12-15-10

Markets are called mixed this a.m. behind a choppy overnight session as markets continue to move towards holiday mode in an environment that is lacking a little news. 

In the overnight session the grains started off and shown weakness for most of the session; but they did show some strength by the time overnight session was over or paused at 7:15.  At that time corn was up 1-2 cents, beans where up 5, KC wheat was up 4-5, MPLS wheat was up 6, and CBOT wheat was up 4.  The December contracts expired yesterday and with that we did leave a cap on the continous corn chart.

At 9:15 outside markets are mixed with equities firmer with the DOW up 28 points, crude is down about 40 cents a barrel, European wheat is up about 1 %, and the US dollar is stronger up 230 on the March contract at 79.920.

Weather still appears one of the main drivers, as does fund cash flow movement.  Many firms have put out their picks for 2011, most of those have included crude oil, soybeans, and corn as top investments or commodities that they project a increase in price in.  How accurate these will be only remains to be seen but how the funds decide to position themselves over the couple weeks of the year will help determine where we go to finish off the year.  Any major fundamental factor changes probably won’t happen until the January crop report; weather and pace of sales/demand will be important but the most likely to change the fundamental direction will be the USDA report in January as if I remember correctly it is a report that has moved at least one grain limit one direction or another for the last 3 years.

With a lack of news and yesterdays weakness many thought we could see the grains tail off right off of the opening; but after about 10 minutes of trading the grains have shown more strength then where they overnight session left off at.  Wheat and beans are both up 10-12 cents and while corn is up about 6 cents.  Generically speaking one thing I wouldn’t care to see is today’s bounce attempt fail.

The markets did slowly give the early gains back plenty of the early gains today; the US dollar showed strength and that lead to most of the grains closing under pressure.  Corn was down 3-6 cents, wheat as down 4 in KC, MPLS was down 1, CBOT wheat was down 2, crush sunflowers where off 20 cents, the DOW was down about 20 points, and the dollar is firmer up 900 points.

Not a lot of new news to report; but I did attach a couple of items.  One is some info from RJOMRT and the other has some trade thoughts/ideas on corn.

Wheat basis did feel better and I noticed the spot floor was firmer on high pro’s.  Birdseed buyers didn’t show tons of interest but have been calling a lot and leaving a sense that they need to buy.

Easy Bill Marketing Plan

Easy Bill
WW   100,000.00 bushels $       5.10
SW   100,000.00 bushels $       5.70
Corn   100,000.00 bushels $       4.00
Bill likes to keep things fairly simple 
Cash Flow is not an issue 
Have 100k of ww corn and sw to sell and  we will use the futures price to simplify things.
If target price is not hit by deadline then grain will be sold at

Tuesday, December 14, 2010

Comments 12-14-10 Wheat markets hit hard

This a.m. markets are called mixed to weaker this a.m. behind an overnight session that saw a little red for the wheat and corn. 

In the overnight session corn was down 2-3 cents, beans where firmer by a couple of pennies, KC wheat was off 3-5 cents, MPLS wheat down 4, and CBOT wheat was down 5-7.  At 9:00 outside markets have the dollar up slightly with the March at 79.695, equity markets are firmer as the DOW is up about 42 points, crude is down about 50 cents a barrel, and the European wheat market is near unchanged.

Last night’s Chinese corn offering only found buyers for 131 TMT of the 1.8 MMT that was offer out.  Oil world pegged the Argentina bean crop at 54.4 MMT with the Brazil bean crop at 68.7; versus 52 and 67.5 that the USDA had them pegged at.

As mentioned yesterday the technical price action (sideways – consolidated with no strong sense of direction) we have seen in the wheat market along with the fact that the funds covered 30k plus short contracts last week makes me a little nervous in regards to where wheat goes over the next couple of weeks.  Any time we see price action like yesterday where the deferred contracts gain big time on the nearby; it isn’t a sign of upfront demand.

The birdseed market appears to be a little on the softer side the past couple of days.  Many of those that where looking last week don’t seem to have much interest right now.  I would say that generically speaking the birdseed market in general is one that if you have to sell you might not get the best price you would like; but it isn’t easy to buy either.  I.E. bid ask spreads are on the wide side right now.  Overall birdseed markets and prices should continue to follow the other markets.

As the markets went on this a.m. we quickly added to the weakness; especially in wheat.  Watching the price movement threw out the day we appear to hit many spots as I noticed quiet regularly moves that appeared to be a nickel or more at a time. 

MPLS which had been leading the wheat markets firmer the past couple of weeks; lead the downside pressure; part of this came from Japan doing business with Australia for high quality – food grade wheat.  Reminds me of Russia getting export sales back in July despite the drought; perhaps not the best thing to have happen; but maybe it is good to see some wheat move out of there at this time of the year as it is harvest and in theory if the wheat moves now it becomes more expensive to get out of bins after harvest. 

The technical action in the wheat market was on the horrible side of things once again today.  As we are now 40-50 cents off of our highs from just a week ago.  Those highs where against resistance in some contracts and with the sharp rise up it could be tough to find solid support; on the positive side of things all good markets have corrections and as the above comment refers we really didn’t break any major support level. 

The reality is that our price as we go forward probably simply follows the three main same factors as it typically does; funds and their money flow, fundamental changes, and fear.  Fundamentally we won’t see a lot of new news but how our exports go and what weather does for the size and quality of the crops will make a big difference over time.  The fear factor could simply be why we are where we are at; but we also need to watch out for the emotions be it fear or greed overdriving market reaction and we could easily see fear of inflation or fear of running out of XYZ commodity (as example corn, high quality wheat in Europe, Cotton, Beans……etc) all have spill over effects for the grains.

As mentioned yesterday the best thing I have liked about the recent rally is the fact that we still had buying interest and seen basis and the board go in the same direction.  That doesn’t mean we bounce right back but it leaves the door open to a bounce at any time at least until that fundamental outlook changes.

This communication makes no representation or warranty regarding the correctness of any information contained herein, or the appropriateness of any transaction for any person.  Nothing herein shall be construed as a recommendation to buy or sell any commodity contract.  There is a risk of loss when trading commodity futures or options.

Monday, December 13, 2010

Grain Market Comments 12-13-10

With these crazy markets and various duties many time over the past several months many times I have started opening or closing comments but not finished.  So I think I am going to try to do the comments in a different manner.

Markets are where called better this a.m. behind a stronger overnight session and firmer outside markets.

In the overnight session corn was up 3-5 cents, beans where up 12-13, KC wheat was up 7-9 cents, CBOT wheat was up 4-5 cents, and MPLS wheat was up 6-7 cents. At 9:10 outside markets are supportive with the dollar showing some weakness down 456 points on the December at 79.610, crude is up about 1.30 a barrel, and equity markets are slightly firmer with the DOW up 20 points.  European wheat markets are near unchanged not really helping to give much market direction.

Monday, December 6, 2010

Interesting Webiste with Interactive Graph

Here is an interesting website with an interactive image on it to show how certain strategies can leave you open to price, basis or unlimited risk.