WASDE report Tuesday was met with mixed reactions. Corn not as bearish as expected and we got a 3 3/4 bounce, 322 1/4. Rice cut exports and new crop carry over pegged in the expected range, 1545 1/2, plus 5 1/2. Market did go soft and dip lower but recovered. One of the last shorts in may paid up 50 cents to get out of the trap, and that surely had some effect. Beans off 3 to 852 as old crop stocks on the high end of guesses. I keep bringing it up, but China can absorb those stocks pretty quickly. Looks like they will buy our entire pork supply for a song. Shut down a few plants and get hog prices to collapse, then ship all the meat you can buy for pennies back across the ocean. Think the farmer isn't getting played? Wheat off 2 3/4 cents, 514 1/2, and nothing in the report to get me excited. Dow off 550 points to 23,574, and still higher than my calculator likes it, while bonds regain a point and 10 tics, 179.26.
Quiet weekend so no fireworks in Monday trade as positions are evened up in front of Tuesday WASDE. Corn off 3/4 to 318 1/2. Rice gains 7 cents, 1540 as May is about over. Beans up 4 1/2 to 855, but meal rally couldn't hold. Wheat off 4 3/4 to 517 1/4. Plenty of wheat bulls still out there but I am reminded that there is wheat being harvested somewhere in the world every 90 days and there is plenty of bread on the shelves. Wheat is not a friendly written contract for the bulls either. Dow off 162 points, 24,124, and bonds drop a point and 6 tics, 178.16.
China grain buying rumors and truths still pushing the grain market higher Friday. Corn up 1 1/4 to 319 1/4 and beans gain 5 1/4 to 850 1/2. Both were stronger early in the day. Rice gains 28 cents, 1533. Focus shifting away from may and 150 1600 calls liquidated on Friday. That's a new one, worth paying attention to. Wheat off 1/2 to 522. Dow up 443 points, 24,286, and bonds churn down to 179.22, off a point and 14 tics.
Grains found a bid as the short side wasn't getting the effect they hoped selling the hole. Some rumors about china, both current sales and a bigger agreement. Corn up 3 3/4 to 318. Ethanol usage ramping right back up and lots of plants shut in will allow for margins to get healthy very quickly, and even though they don't care about the farmer, they care about their margins. That's what turns the plants, and demand back on. Beans up 11 3/4 to 844 1/4 as we are at least 60 cents too cheap still. Wheat gains a nickel, 522 1/2. Rice up 16 cents, 1505. 50 deliveries by one holder from march to a commercial long in may by my guess. Dow up 330 points, 23,843, and bonds gain 2 points and 13 tics. 181.04. Fed funds are calling for negative rates next year, as we had mentioned earlier, and 181 bonds is still cheap if that comes to pass.
Beans off 7 in quiet trade, 832 1/2, while corn slips 2 3/4 with weak basis, but strength on the river. 314 1/4. I do expect ethanol will be back up sooner that expected. Just go out a drive around. Roads are filling back up, and those cars need fuel. Don't forget we have E 15 now as well. Wheat off 3 1/4 to 517 1/2. Dow soft and down 248 points, 23,513, and bonds off a point and 18 tics, 178.23.
Pretty quiet day Tuesday as corn regains 1 1/2 to 317. Beans up 3 cents, 839 1/2. Wheat finds 1 1/4 as well, 520 3/4. Rice up 1 1/2 as people wait and watch the May wind down. July closes 1473 1/2. Dow up 190 points, 23,761, while bonds slip 14 tics, 180.09.
Switching to July futures, Monday corn off 3 to 315 1/2. Beans drop 13 to 836 1/2 with meal off $4. Wheat bounces 3 cents, 519 1/2. Rice down 5 1/2 to 1472. Financials quiet with bonds up 2 tics, 180.23, and Dow off 48 points, 23,571.
Dow got hit Friday for 611 points as the overrun to the upside has hit the wall. 23,619. Bonds off 12 tics, 180.21. In Ag Friday, Corn unchanged. 311 1/2. Beans off 3 to 847 1/4 with meal off 2 dollars. Wheat down 8 1/4 to 521 1/2. May rice closes down 38 cents, 1677 1/2, but that was about a buck higher than where we were trading.. Just another structural failure in the exchange. As the years go by I have come to realize that what we most gave up by closing the floors was the member oversight of the minutia that makes the exchange work. The details in all things, from settlements, to market participants, to market rules. Rice settled off of false spreads, not reality. Crude goes into negative territory, in a compelled delivery contract that some buyers cant take delivery in. An owner will always oversee his domain to a much higher level than an employee. Without constant review and adjustments, the core erodes.
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