07-12-10 Grain Market Recap
Corn Market Commentary for 7/12/2010
September Corn ended down 3 3/4 at 379 3/4, 6 1/4 off the high and 1 up from the low. December Corn settled down 3 1/2 at 391 3/4. This was 1 1/2 up from the low and 5 3/4 off the high.
December corn saw 2-sided trade overnight before selling off to start the day session. This took the December contract to below Friday’s lows into early mid session, and the market returned to just above the early lows prior to the close. Traders said that the recent moderation in temperatures in the Midwest and welcome rains in the eastern Corn Belt and into the mid southhelped to pressure the market today along with lower crude oil and a moderately higher dollar. However, forecasts call for warmer weather across much of the Midwest starting on Wednesday. Longer term forecasts are now calling for a dome of very hot air to settle in over the central and southern Plains and into the central Midwest by next Tuesday or Wednesday, bringing well above normal temperatures for the following week. One forecaster indicated that next week’s pattern resembles the conditions during summer drought of 1983. The USDA announced a sale of 152,400 tonnes of US corn to an unknown destination this morning for delivery during the 2010/11 crop marketing year. Traders indicate that the good-to-excellent quality rating for corn may be unchanged to slightly lower on this afternoon’s Crop Progress report from the USDA after a drop of 2% in the good-to excellent rating last week and a 4% drop from two weeks earlier. This week’s export inspections for corn were 34.519 million bushels, down from 40.774 million last week. Inspections need to average 49.810 million each week to reach the USDA’s export projection for 2009/10.
September Rice settled down 0.185 at 9.8, equal to the high and equal to the low.
Wheat Market Recap Report for 7/12/2010
September Wheat closed down 2 1/4 at 535 3/4, 6 off the high and 2 1/4 up from the low. December Wheat finished 2 1/4 at 564 1/4. This was 2 up from the low and 5 3/4 off the high.
December wheat traded on both sides of yesterday’s close throughout the overnight and day sessions before finishing near the lows of the day. The December contract traded inside the previous day’s range for the second day in a row. Traders said that a higher dollar and weakness in key commodities brought selling pressure to wheat today. Algeria’s agriculture minister said today that Algeria’s durum crop is expected to be good, but that the soft red crop is only expected to be average. Cash prices for hard red winter wheat were steady to start the week as farmer selling has tailed off into the last stages of harvest. This week’s export inspections for wheat were 14.129 million bushels, down from 16.883 million last week. Inspections need to average 19.528 million each week to reach the USDA’s export projection for the 2010/11 crop marketing year.
December Oats finished down 11 at 260 1/4. This was 5 3/4 up from the low and 11 off the high.
Soybean Complex Market Recap Recap for 7/12/2010
August Soybeans closed up 4 1/2 at 997 3/4, 11 1/4 off the high and 11 1/2 up from the low. November Soybeans finished down 2 1/4 at 951. This was 6 up from the low and 9 3/4 off the high.
August Soymeal finished down 0.1 at 300.8. This was 2.8 up from the low and 4.0 off the high.
August Soybean Oil closed up 0.11 at 37.61, 0.16 off the high and 0.41 up from the low.
July soybeans posted a modest gain on the day while November soybeans traded marginally lower. The July contract gained for the 8thstraight session today on tight cash markets, which traders indicate has also been reflected in zero deliveries against the July contract so far in the delivery period. July meal also gained on deferred contracts today and traders said that this helped to pull soy oil fractionally higher into early afternoon. Forecasts call for mostly dry conditions in the Midwest from Wednesday through Friday along with warmer temperatures. Showers fell overnight and into this morning in the Ohio Valley/Kentucky area and into parts of Ohio. This was considered beneficial. Minnesota, Iowa and Wisconsin also saw showers, although this was less beneficial than the rains in the east and mid south. Traders said that early pressure came from a sharp drop in crude oil and a moderate sell off in gold and equities along with modest gains in the dollar. This week’s export inspections for soybeans were 6.515 million bushels, up from 3.011 million last week. Inspections need to average 11.647 million bushels each week to reach the USDA’s export projection for the 2009/10 crop marketing year.
With today’s commentary talking about weather, traders might want to take a peek at the commercial traders momentum. The Commercial Trader momentum can be tracked by using the Commodity Futures Trading Commission Commitment of Traders reports. Our idea is that, in a value driven commodity futures market no one knows fair value like the people who produce it or, have to use it. In fact, it is precisely their sense of value that provides the commodity market’s rhythmic meanderings that swing traders love so much. Let’s face it, producers know when their product is overvalue and it should be sold just as well as end line users know when they should be stocking up at low prices. Therefore, trader should be able to incorporate this valuable information into their future market education.
This blog is publicized by Andy Waldock. Andy Waldock is a financial advisor, asset manager, trader, analyst and brokerfor Commodity & Derivative Advisors, located in Sandusky, Ohio. As a result, Andy Waldock may have positions for himself, his relatives, or his customers in any commodity future market discussed. The blog is meant for educational purposes and to develop a dialogue among those with an interest in the commodity future markets. The commodity markets employ a high degree of leverage and commodity trading may not be appropriate for all investors. There is substantial risk in investing in commodity futures. If you are interested in reading other circulated articles, commenting on his writings or subscribing to Andy’s blog, please visit http://blog.commodityandderivativeadv.com, or if you have any questions, please call 1-866-990-0777.
The daily commentaries provide a summary of any reports released that day, a recap of each commodity’s traded price activity, an analysis of the factors that influenced price activity, and a look ahead at the schedule for the next day. CME Group provides market commentaries for soybeans, corn, wheat, gold and silver. The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.
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