Tuesday, November 15, 2011
Grain Market Opening Comments 11-15-2011
Markets are called mixed to better following an overnight session that was mostly firmer with beans leading the way higher.
In the overnight session beans where up 15 cents, KC wheat was up 3, MPLS wheat was up 2-3, CBOT wheat was up 1, and corn was up 3-4 cents. At 9:15 outside markets have equities weaker with the DOW off 33 points, crude up 60 cents, the dollar is up about 342 with the DEC at 78.08.
Yesterday we had export inspections out that had beans well above what is needed on a per week basis while corn and wheat continue to lag what is needed on a per week basis to meet current USDA projections.
Basis is hit and miss on the grains; as we simply don’t have enough export to domestic competition for basically all three of the major markets. Corn basis is firm; but we lack exports, wheat basis is also firm but spot was weaker yesterday then it was last week. Some to arrives are also weaker; late last week I sold a 15 pro to arrive train and yesterday the bid I got for the same quality was 50 cents lighter then what I sold Thursday/Friday last week.
Bottom line is the small spike we seen to start last week caused a little movement in some of the grains thus has lead to basis being rather choppy because there is plenty of room everywhere, rail freight isn’t tight, and we simply lack export to domestic competition.
Markets have now opened and about 10 we have the markets weaker then where the overnight session left off. We started off a little firmer then where the overnight session left of but currently we have beans up 10-11, corn down a penny (6 cents off of it’s highs about 30 mins ago), KC wheat unchanged, CBOT wheat up 1, and MPLS wheat up 1. Look for the rest of the session to be choppy and probably range bound like most of our markets have been for the past month or so.
Technically many markets are flirting with support after testing resistance last week. The biggest thing our markets don’t have going for us is we don’t have much money wanting to flow into grains; outside markets and the problems in Europe have lead to a lot of risk off type of investments. Perhaps making the chances of taking out last years highs lower then many expect is the fact that risk doesn’t want to flow into our markets, the world seems to have solved many of it’s supply issues, and we simply have farmers sitting on a lot of product at a time when the exports are suppose to be coming from us and that could be leading to a shifting of demand to other areas in the world that seem to have ample supply.
Don’t forget that we have our weekly meetings every Wed in Onida.
Also with the nice winter we have had don’t be afraid to take advantage of our free delayed priced program for both winter wheat and spring wheat.
Please give us a call if there is anything we can do for you.
Labels: Beans, charts, Charts and Strategies, commodity price risk management tools strategies grains futures options money cash flow, crop conditions, Delta Neautral Trading, Leverage Optoins Futures, Marketing Tools, MWC Marketing Hour Round Table, opening grain comments, option selling, Price Management, USDA Crop Report Supply and Demand