December 3, 2020
Good Morning,
Markets are unchanged in corn and up 8 in soybeans to start the day.
Rumors abound for Chinese demand for corn, beans and HRW or white wheat. China is also looking to buy new crop soybeans with the dollar discount to current prices. Unfortunately there has been a lot of rumors of cancelations of late that have the markets hesitant to add premium.
On Wednesday, funds were net buyers of 10,000 contracts of SRW Wheat; 12,000 Corn; and sellers of 8,000 Soybeans. Funds are net long 1,000 contracts of SRW Wheat; long 258,000 Corn; net long 172,000 Soybeans.
USDA export sales were 446,400 mt of wheat, 1,371,400 mt of corn, with China taking 154,000 mt, and 406,900 mt of beans. Exports were on the low end for beans and on the high end for corn. The corn sales continue to surprise, especially when you consider this was during Thanksgiving week.
Showers will fall across most of Brazil over the next ten days. It starts in the south and works its way north over the weekend. There will be chances of rain in North and Central Brazil every few days. Argentina is going to dry out over the next 10 days. La Nina looks to be a continuing trend for both Southern Brazil and Argentina.
Have a Safe Day!
Garry Gard
920-348-6844
December 1, 2020
Good Morning,
After yesterday’s fund selling with month end profit taking the markets are steady this morning. Markets are neutral to start the day/month with corn unchanged and soybeans up 3. On Monday, Managed funds were net sellers of 13,000 contracts of Wheat; 27,000 Corn; 17,000 Soybeans. Funds are now net long 8,000 contracts of Wheat; long 257,000 Corn; net long 214,000 Soybeans.
November was a good month in the grain markets with corn closing $.23 cents higher and soybeans closing $1.12 higher. Rallies like this during harvest timeframes are rare but very welcome, especially for producers that were short on sales and space.
There is rain forecast for North and Central Brazil that starts on Sunday. The amounts are .75-2 inches, which is still below normal for this time of year. The models have been over-estimating rain totals for a month, showing heavy amounts coming in, with very little actually hitting the ground. Mato Grosso rarely sees dry weather at this time of year and usually will receive 2-3 inches a week. They may be moving back to a more normal forecast with the 10 day model run and the more into the 9th of December.
I look for the markets to trend sideways to lower during the month of December with South American weather, COVID-19 and Chinese cancelations in the drivers seat.
Have a Safe Day!
Garry Gard
920-348-6844
November 30, 2020
Good Morning,
Markets are lower to start the week and end the month. Corn is currently down 3, soybeans are down 18 and wheat is down 11. The overnight session started out higher with beans taking another stab at 12 dollars futures, missing with a high of 11.99 before falling back and settling lower in the early morning trade. Corn futures traded up to 4.395, making a new high, but also failing and heading lower. Just about every market is lower this morning, whether it be New York, gold or bonds. Even the US dollar is lower.
Russia may increase the size of its grain export quota planned for Feb. 15-June 30 to 17.5 million tonnes from 15 million tonnes, the agriculture ministry said.
There are rumors that China is preparing to allow another 5.0 mmt of work corn purchases via TRQ/GMO licenses. China has been mostly absent recently for corn and new bean purchases, even cancelling and rolling out some cargoes to next year.
The bulls continue to talk about dryness in Argentina and Brazil, yet the weather models don’t quite back it up. Mato Grosso is forecast to see .75 to 1.5 inches of rain in the next 10 days. Argentina just received 1 to 3.5 inches of rain over the weekend. Some heavy rains are forecast this week with up to 5 inches forecast in Eastern Brazil. Temps will be between 80 to 100 degrees, depending on the placement of rain. This forecast looks bearish, and am not sure we are trading weather anyway.
Looks like profit taking going into the end of the month for corn and beans. The weather forecast alone, should have prices down more than they are. At some point this market is due for a bigger correction, and I guess we’ll know it when we see it. The market is dangerously long.
Have a Safe Day!
Garry Gard
920-348-6844
November 27, 2020
Good Morning,
Prices are called higher, but exports may produce a lower open in beans. This is one of the few times of the year with no overnight markets. US Stocks are up 80 and crude oil is down 50. A small two sided trade is expected today, with wheat most likely trading higher, bouncing off of Wednesday’s losses. World markets are stable.
Export sales were 65.6 million for corn and 28.2 for soybeans. Corn was right at the 10 week average while soybeans were 50 million bu. below the 10 week average. Rumors of Chinese cancelations that have already been made has the markets on edge the last few days.
Have a Safe Day!
Garry Gard
920-348-6844
November 25, 2020
Good Morning,
Markets are down 4 in corn, and down 6 in bean. Crude oil is up 40 and US Stocks are down 50. A two sided Holiday trade is expected in most markets today and Friday. Market hours are normal today, but close early at 12:00 Central on Friday. Trading interest is going to be diminished today, traders won’t take any risk until Monday of next week, especially in beans with South American weather forecast changes possible, and the potential for Chinese soybean cancelations.
Reuters is reporting that private importers and processors of soybeans in China are looking to cancel out of some of the cargoes of US beans purchased early this year. The importers that did not fix futures during the purchase are looking at negative margins on delivery, and are better off eating the cost of the cancelation. Cargoes can be rolled out to next year if necessary with trading cost. US Gulf basis had dropped from +90 to +60 in the past week. New Chinese business has been absent. The buying started in June, and much of what is on the books had futures coverage at the CME, when prices were low.
Have a Happy Thanksgiving,
Garry Gard
920-348-6844
