Markets are called better this a.m. behind a bounce in the overnight
session.
Old crop corn was up 5, new crop was up 3-4, KC wheat was up
3 cents, MPLS wheat was up 3, CBOT wheat was up 2, and Soybeans ranged from up
11 to up 16. Outside markets at 8:20
have the US Dollar off 100 points, crude is off a buck, gold is up 6 bucks, and
the DOW futures are pointing towards a positive start of 60-70 points.
This a.m. we did have export sales out. Below is the CHS Hedging recap of them………..I
didn’t see anything great or bad.
Overall the wheat number was good on
per week basis and on top side of the estimates, beans strong on new
crop while ok on old crop and overall above estimates, corn was good on old crop,
but the total was under the trade estimates.
The other big thing we have will be the USDA report on
Monday. The main thing here is that the
market is looking for big carryout numbers for new crop to still be in the
cards for both corn and beans. Each of
the last couple of years the USDA started off with big carryout numbers in their
May/June reports; but by the time August/September came around those carryout
levels got smaller and smaller.
The market isn’t looking for that to happen this time; they
are still looking at overall big crops and carryout numbers more than two times
what they have been the past few years.
Now the one positive I mentioned yesterday is the fact that this is all
getting to be old news and hopefully priced into the marketplace. But the reality is that our markets can very
much over do price moves.
Here is the CHS Hedging Recap/Ideas for the report.
Not much else to report; you will notice that the weekly
wheat sales do show big numbers to Brazil.
When I was talking to a buyer this a.m. he thought that had something to
do with the KC Sept gaining on the KC Dec; he mentioned that the gulf basis
actually felt a little weaker.
Fundamentally I view it as very good that KC Wheat spreads continue to come in. Especially given the fact that we are still harvesting some wheat in the US and some guys have just got done. Basis is suppose to be the weakest and spreads should get the widest at the tail end of harvest; because the guys should be full and bought what they need.
Bottom line KC Sept gaining ground on KC Dec is one very
good fundamental sign. Hopefully
sometime in the future we can see wheat help support the other markets?
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