Post by Dave-ECIA on Jan 10, 2012 10:48:50 GMT -5
Since our resident cut-and-paster has been generally quiet, I need a fix.
These comments mirror some of my thoughts on the South American weather, and the validity of USDA. The SA crop is a lot like ours. We all (as farmers) tend to downplay the crop. Interesting that some of the services are starting to increase the crop size in Brazil.
Notice in the sales section the +$1.66 over May sales of 63000mt corn.
Anyway, here you go.....
Corn Commentary - USDA report doesn’t matter?
Tuesday, January 10, 2012 9:03 am
The corn market was higher on Monday as the weather situation continues to get worse as the rains disappoint and aren’t happening yet. The March and December contracts both closed up about 9 cents, but March was about 10 cents off the highs and December was about 3 cents off the highs. The March contract opened about 8 higher and traded as much as 13 cents higher and then settled into a range of 9-12 cent trading range. After the first hour or so, the March contract spiked again and traded almost 20 higher, but the trade couldn’t hold these gains an slipped lower most of the rest of the session before volatility kicked in and we traded in about a 6 cent range into the close. The weather in Argentina is the driver for corn right now as it was very hot over the weekend which did more damage regardless if the rain fell early this week. Now, some forecasters are looking for lower amounts of rain this week which will keep corn on edge. We will also see traders positioning themselves in front of the USDA report and some will take quick profits instead of holding long positions. The volume was ok at 285,000 contracts and funds were buyers of about 10,000 contracts.
Overnight, the corn market closed around unchanged as it was able to recover off the lows of the session made in the early morning as rains continue to disappoint in Argentina. The corn market is being driven by weather in Argentina right now, even more so than the USDA report, and maybe now, the USDA report doesn’t move the market until the weather has stabilized in So America. The USDA report is a huge report and the stocks numbers are probably more important than production numbers, but there are doubters out there that feel the USDA is over stating the corn crop and they won’t make a big change in yield, but will make up for it in lower stocks. Who knows, but I do know that the USDA does a better job than any private forecaster for surveying farmers. The problem is sometimes the right questions are being asked and that is why the data is sometimes not good. The corn market will be called slightly higher this morning as the outside markets are positive with stocks and crude higher and the US$ lower. The weather in Argentina should keep corn prices higher, but most traders will probably wait for the USDA report to take on significant positions. Weather markets are very hard to trade as evidenced last week and yesterday. Strap on your boots, things could get exciting.
LaSalle Street News Early Opening Calls: 1-2 higher
LaSalle Street News Top News **Brazil’s CONAB estimates the country’s summer Corn crop size at 37.92 mln mt up +5.6% – S Korea’s Nonghyup Feed group bought a total of 118,000 mt US feed Corn in a snap tender on Tuesday, CHS was a reported seller of 55,000 mt at a price of $325.58/mt cif and STX sold 63,000 mt for $1.668/bu over May CBOT futures – Chinese customs data shows during December the country exported 2,023 mt of Corn, down -70% from the year ago month. However, total 2011 Corn exports totaled 136,083, a rise of 7% on the year. – Celeres lowered their 2011/12 Corn production estimate to 36.8 mln mt vs. the previous estimate of 38.6 mln mt, a drop of -12% from last summer’s corn crop. Celeres now expects yield-per-hectare to fall 2.2% from 2010-11. – Goldman Sachs commodity research head told a conference in London the group is positive on Corn short term, while Soybeans are favored long term. – Iowa State ag researchers published a report suggesting 2012 looks to be profitable for Corn and Soybeans, although less than 2011 based on current futures prices and production cost. They estimate a return of $1.00 per bu. for Corn vs. $1.90 in 2011. – Analysts surveyed expect 11/12 Corn annual production at 12.28 bln bu that’s slightly below the December USDA report of 12.3 bln bu and 2010’s 12.44 bln bu. The data will be released on Thursday morning at 7:30 am CT. – The average US national corn yield estimate by grain analysts for Thursday’s USDA report is seen at 146.4 bu/ac, that’s three tenths below the December report and well below 2010’s 152.8 bu/ac. – US 11/12 Corn ending stockpiles are forecast by grain analysts in Thursday’s supply/demand report at 0.750 bln bu down from the December report 0.848 bln bu. – USDA quarterly grain stocks data will be released at 7:30 am CT on Thursday, Dec 1 Corn stocks are seen at 9.40 bln bu that compares to the year ago figure of 10.05 bln bu and up from Sept 1 stocks data of 1.12 bln bu. – Monday’s USDA Weekly Corn Inspections: 33.899 mln bu for w/e Jan 5 ; expected 34.0 mln bu – Pending Tender: Japanese ag ministry official also announced another SBS tender deadline of Jan 11, 2012 where they’re seeking 200k mt of feed barley and 9,000 mt of feed Wheat – Pending Tender: EU traders say 50,000 mt of EU Corn and 35,000 mt of EU feed wheat is being sought by Israeli group in a tender to close on Wed., Jan 11th. The grain is for shipment in the Feb 20th to April 10th period – Pending Tender: Cash sources say 21,000 mt of US Corn Products is being sought by Israeli group in a tender deadline for Jan 11th. Shipment is expected Feb 20th to Mar 10th. – Pending Tender: Cash merchandisers in the EU say Jan 19th is bid deadline in a newly announced tender by Jordan, they’re seeking 100,000 mt of feed Barley – Dalian Sept. Corn futures were up + 7 @ 2,301 yuan/mt. – Liffe Mar. Corn futures were down - .75 @ 203.50 Euros/mt. – CBOT Corn Volume & Open Interest for January 9th 2012 was 285,177; Open interest increased +8,036 to 1,212,675. – CBOT Ethanol Volume & Open Interest for January 9th 2012 was 726; Open Interest increased +5 to 10,287. – Weather: 6 – 10 Day Forecast: Normal Temps. Normal to Above Precip – Outside markets. Crude Oil up +$1.98 @ $103.29; Gold up +$29.10 @ $1637.20; Silver up +$1.19 @ $29.98; US $ index off 27 pts @ 81.11
LaSalle Street News Cash Markets – CIF Corn steady off 1. Jan. +55 to +57, Feb. +55 to +57, Mar. +56 to +58, A/M +52 to +56, J/J +52 to +55, Aug. +70 to +100
TREND:
We got the bounce off the bad technical trades last week. The reversals are as dynamic as the trade was last week. Not sure we can build on it in front of the report on Thur?
Corn made a run at least weeks highs and stalled. Look for rallies to have trouble as we near 6.70 to 6.75 in the March. A settle above 6.80 would be significant. On breaks, look for support from 6.40 down to 6.35. A settle below 6.30 could be significant.
These comments mirror some of my thoughts on the South American weather, and the validity of USDA. The SA crop is a lot like ours. We all (as farmers) tend to downplay the crop. Interesting that some of the services are starting to increase the crop size in Brazil.
Notice in the sales section the +$1.66 over May sales of 63000mt corn.
Anyway, here you go.....
Corn Commentary - USDA report doesn’t matter?
Tuesday, January 10, 2012 9:03 am
The corn market was higher on Monday as the weather situation continues to get worse as the rains disappoint and aren’t happening yet. The March and December contracts both closed up about 9 cents, but March was about 10 cents off the highs and December was about 3 cents off the highs. The March contract opened about 8 higher and traded as much as 13 cents higher and then settled into a range of 9-12 cent trading range. After the first hour or so, the March contract spiked again and traded almost 20 higher, but the trade couldn’t hold these gains an slipped lower most of the rest of the session before volatility kicked in and we traded in about a 6 cent range into the close. The weather in Argentina is the driver for corn right now as it was very hot over the weekend which did more damage regardless if the rain fell early this week. Now, some forecasters are looking for lower amounts of rain this week which will keep corn on edge. We will also see traders positioning themselves in front of the USDA report and some will take quick profits instead of holding long positions. The volume was ok at 285,000 contracts and funds were buyers of about 10,000 contracts.
Overnight, the corn market closed around unchanged as it was able to recover off the lows of the session made in the early morning as rains continue to disappoint in Argentina. The corn market is being driven by weather in Argentina right now, even more so than the USDA report, and maybe now, the USDA report doesn’t move the market until the weather has stabilized in So America. The USDA report is a huge report and the stocks numbers are probably more important than production numbers, but there are doubters out there that feel the USDA is over stating the corn crop and they won’t make a big change in yield, but will make up for it in lower stocks. Who knows, but I do know that the USDA does a better job than any private forecaster for surveying farmers. The problem is sometimes the right questions are being asked and that is why the data is sometimes not good. The corn market will be called slightly higher this morning as the outside markets are positive with stocks and crude higher and the US$ lower. The weather in Argentina should keep corn prices higher, but most traders will probably wait for the USDA report to take on significant positions. Weather markets are very hard to trade as evidenced last week and yesterday. Strap on your boots, things could get exciting.
LaSalle Street News Early Opening Calls: 1-2 higher
LaSalle Street News Top News **Brazil’s CONAB estimates the country’s summer Corn crop size at 37.92 mln mt up +5.6% – S Korea’s Nonghyup Feed group bought a total of 118,000 mt US feed Corn in a snap tender on Tuesday, CHS was a reported seller of 55,000 mt at a price of $325.58/mt cif and STX sold 63,000 mt for $1.668/bu over May CBOT futures – Chinese customs data shows during December the country exported 2,023 mt of Corn, down -70% from the year ago month. However, total 2011 Corn exports totaled 136,083, a rise of 7% on the year. – Celeres lowered their 2011/12 Corn production estimate to 36.8 mln mt vs. the previous estimate of 38.6 mln mt, a drop of -12% from last summer’s corn crop. Celeres now expects yield-per-hectare to fall 2.2% from 2010-11. – Goldman Sachs commodity research head told a conference in London the group is positive on Corn short term, while Soybeans are favored long term. – Iowa State ag researchers published a report suggesting 2012 looks to be profitable for Corn and Soybeans, although less than 2011 based on current futures prices and production cost. They estimate a return of $1.00 per bu. for Corn vs. $1.90 in 2011. – Analysts surveyed expect 11/12 Corn annual production at 12.28 bln bu that’s slightly below the December USDA report of 12.3 bln bu and 2010’s 12.44 bln bu. The data will be released on Thursday morning at 7:30 am CT. – The average US national corn yield estimate by grain analysts for Thursday’s USDA report is seen at 146.4 bu/ac, that’s three tenths below the December report and well below 2010’s 152.8 bu/ac. – US 11/12 Corn ending stockpiles are forecast by grain analysts in Thursday’s supply/demand report at 0.750 bln bu down from the December report 0.848 bln bu. – USDA quarterly grain stocks data will be released at 7:30 am CT on Thursday, Dec 1 Corn stocks are seen at 9.40 bln bu that compares to the year ago figure of 10.05 bln bu and up from Sept 1 stocks data of 1.12 bln bu. – Monday’s USDA Weekly Corn Inspections: 33.899 mln bu for w/e Jan 5 ; expected 34.0 mln bu – Pending Tender: Japanese ag ministry official also announced another SBS tender deadline of Jan 11, 2012 where they’re seeking 200k mt of feed barley and 9,000 mt of feed Wheat – Pending Tender: EU traders say 50,000 mt of EU Corn and 35,000 mt of EU feed wheat is being sought by Israeli group in a tender to close on Wed., Jan 11th. The grain is for shipment in the Feb 20th to April 10th period – Pending Tender: Cash sources say 21,000 mt of US Corn Products is being sought by Israeli group in a tender deadline for Jan 11th. Shipment is expected Feb 20th to Mar 10th. – Pending Tender: Cash merchandisers in the EU say Jan 19th is bid deadline in a newly announced tender by Jordan, they’re seeking 100,000 mt of feed Barley – Dalian Sept. Corn futures were up + 7 @ 2,301 yuan/mt. – Liffe Mar. Corn futures were down - .75 @ 203.50 Euros/mt. – CBOT Corn Volume & Open Interest for January 9th 2012 was 285,177; Open interest increased +8,036 to 1,212,675. – CBOT Ethanol Volume & Open Interest for January 9th 2012 was 726; Open Interest increased +5 to 10,287. – Weather: 6 – 10 Day Forecast: Normal Temps. Normal to Above Precip – Outside markets. Crude Oil up +$1.98 @ $103.29; Gold up +$29.10 @ $1637.20; Silver up +$1.19 @ $29.98; US $ index off 27 pts @ 81.11
LaSalle Street News Cash Markets – CIF Corn steady off 1. Jan. +55 to +57, Feb. +55 to +57, Mar. +56 to +58, A/M +52 to +56, J/J +52 to +55, Aug. +70 to +100
TREND:
We got the bounce off the bad technical trades last week. The reversals are as dynamic as the trade was last week. Not sure we can build on it in front of the report on Thur?
Corn made a run at least weeks highs and stalled. Look for rallies to have trouble as we near 6.70 to 6.75 in the March. A settle above 6.80 would be significant. On breaks, look for support from 6.40 down to 6.35. A settle below 6.30 could be significant.