Monthly Archives:: January 2016

Weekly Grain Update 1.29.16

To end January we saw yet another dramatically sideways trending week.  Corn attempted to break through recent resistance at $3.72 but each time the nearby contract got close, sellers entered the market, limiting gains.  Accompanying each small rally was incremental sales from the producer which is slowly eroding corn basis.   Soybeans on the other hand had a little wilder week.  Dry weather in South America had the market attempting a new run higher, until China canceled some US soybean purchases.  To end the week grains and oilseeds both recovered nicely from Thursday’s beating, led by stronger outside markets and month end positioning.  Fundamentally, few solid reasons exist to push prices higher.  Short covering and hope will only get us so far.  It might be time to consider rewarding the market rallies as they come.  Think about making some sales at these prices as the fundamentals still point to lower prices ahead.

On the week, corn managed to gain about a penny, throughout the forward curve.  Basis was mostly steady, with a softer bias, at the ethanol plants.  Most buyers report general coverage through February and are willing to sit back and wait for corn to come to then.  The soybean complex traded in a relatively wide 18 cent range for the week before managing gain five to seven cents.  A portion of the board gains were offset by lower basis values as poor crush margins and strong producer sales on rallies have combined to give a weaker tone to bean basis.

With the volatility we have seen in recent weeks, it is important to have working pricing offers in place to help capture market opportunities.  This could also be a good time to think of Delayed Pricing programs.  Ship the corn now before warmer weather hits and grain quality slips away.  CHS Rochester is offering FREE DP on new delivered corn and soybeans, with pricing by 8/31/16.  Give us a call for more details.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

 

Weekly Grain Update 1.22.16

Another volatile week in both world financial markets and US commodities.  Equities continued to collapse as we started the holiday shortened week, however by the end of the week we seemed on solid ground once again.  Crude oil was also a major influence in the markets this week.  Nearby crude dropped below $30 for the first time in nearly a decade.  As crude stabilized over the $30 mark, financials and grains felt steady as well.  Corn was stronger throughout the week, closing up seven cents on the week.  The near record short position held by funds help support the corn market this week.  On Friday, the weekly export sales showed the largest weekly corn number for the marketing year, lending support to the commodity as well. While soybeans didn’t have a truly disappointing export sales figure, it was not enough to hold early gains.  For the week, beans traded in wide daily ranges, ultimately closing down about two cents.

Locally, even small rallies in corn and beans have pushed some producer grain to market.  Soy processors seem to be seeing the largest movement, widening basis with the board gains.  However, market chatter seems to indicate processors are also slowing down to deal with dismal margins which could be negatively impacting basis as well.  Ethanol plants are seeing poor margins as well, but show little sign of slowing down.  Corn basis has been softer, however cash gains have thus far outpaced basis depreciation.

With the volatility we have seen in recent weeks, it is important to have working pricing offers in place to help capture market opportunities.  This could also be a good time to think of Delayed Pricing programs.  Ship the corn now before warmer weather hits and grain quality slips away.  CHS Rochester is offering FREE DP on new delivered corn and soybeans, with pricing by 8/31/16.  Give us a call for more details.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

 

Weekly Grain Update 1.15.16

This week, the USDA gave us a small glimmer of hope for the grain markets. In Tuesday’s reports the Feds lowered both corn and soybean yield for the 2015 crop.  While the yield drop was not entirely unexpected, the small reductions in planted and harvested acres caught the trade off guard.  Corn saw a reduction of 53 million bushels as a result of those changes.  However, total demand was lowered as well, resulting in a new carry out figure of 1,802 million bushels, up 17 million from December.  Soybeans saw a 50 million bushel drop in production coupled with a 25 million bushel reduction in demand, pushing estimated carryout down 25 million.

The focus on supply, or more specifically lower supply , offered a very faint light at the end of the tunnel as soybeans charged higher following the data release.  Corn became a follower, trading higher as well.  However, much of the commentary since the USDA report has tried to refocus attention to the overall carryout and demand side of the picture.  Weather in South America is turning more benign, limiting crop stress, processor margins are continuing to tighten, and export markets are not favoring the US origins.  All this together is not a friendly fundamental picture.  Soybean margins seem to be struggling the most which is creating an erratic basis situation, five cent board rallies often equate to a five-plus cent basis hit.  The reverse is often true as well.  Rallies such as the ones seen this week warrant our attention. Be alert to opportunities and be ready to reward the market.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

 

Weekly Grain Update 1.8.16

Some have said as China goes, so goes the rest of the world.  This was just the case to start 2016.  Disappointing economic data out of China sent equity markets tumbling, pulling commodities along for the ride.  Three times this week March corn futures traded to new contract lows, finally breaking through the $3.50 mark on Thursday before rebounding to close down just over a penny on the week.  Soybeans traded in a relatively wide range through the week, struggling during the equity collapse eventually showing strength to end the week.

Commodities found strength late in the week thanks to a stabilizing equity market and strong US jobs report.  However position squaring ahead of next week’s USDA reports was just as influential.  Each January the USDA releases their final yield for the just-harvested crop.  Many times this report day becomes a wild day of volatile market swings while traders digest the huge data dump.  This year, it appears less likely we will have the volatility seen in previous years.  Expectations are for few changes to be made on the production side of the balance sheet.  It is also expected that demand will likely drop slightly, generally offsetting any production changes.  Bottom line, world supplies of grain are more than ample right now.  Carry out numbers should continue to grow slowly if no new demand impetus comes along.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

 

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