William Moore's market views are centered around his many relationships with Agricultural producers. His weekly newsletter, AGMASTER, provides a blend of fundamental & technical information used to make prudent hedging decisions. Contact Mr. Moore at (312) 264-4337
The last two days, the action in Nov Beans has epitomized the Trading-range nature of the contract thru Sept! On Friday, the USDA issued a friendly Qtly Stocks Report that moved Nov Beans to mid-range, but then today, heavy harvest pressure took away all those gains!
FACTORS IMPACTING THE MKT
- EXPORTS – Mon Inspections were 894,250 MT (1,036,604) & Thur sales were 3.0 MMT (1.82 – 2.50) – a record
10/2 – 132,000 China
9/28 132,000 Unk
9/27 132,000 China
- CROP PROGRESS – Harv – 22% (LW – 10,Avg – 26)
Ill – 30 (21) Ind – 24(20) Iowa – 16(23)
- USDA QTLY STOCKS – 9/29
Bean Qtly stocks – 301 MB
(Est – 338 June -963 June ’16 – 197) These stocks were on a 10 year high but below expectations So the report was considered friendly
- 8AM FLASH SALES –
9/28 132,000 – Unk 9/15 132,000 China
9/27 132,000 – China 9/14 198,000 China
9/22 190,000 – Mexico 9/13 167,370 Mexico
9/21 132,000 – China 9/12 132,000 Unk
9/20 132,000 China 9/11 352,000 Unk
9/20 960,000 Unk 9/8 264,000 China
9/20 120,000 Unk 9/5 136,000 China
9/18 261,000 China
- BETTER-THAN-EXPECTED YIELDS –seemed to be the rule rather Than the exception – implying that the last two USDA Reports Maybe weren’t overstated after all
- OUTSIDES NOT HELPING – today the US Dollar is 50 points higher & crude oil is $1.50 lower – bad for US Exports & ethanol demand
Exports & good yields are keeping beans range-bound but excessive dryness over the past three weeks may render later yields disappointing!
For the month of September, Dec Corn has been confined to a 15-cent range (345-360). Better-than-expected yields have done battle with solid exports & a lower dollar to keep the mkt sideways – until the USDA updates production & yields on Thur Oct 12. Because of over 3 weeks of dryness in the Farm belt, many feel the later yields will be less!
FACTORS IMPACTING THE MKT
- EXPORTS – Mon Inspections were 782,346 MT (779,971) & Thur sales Were 320 MT (450-850)
Oct 2 597,464 MT China
Sept 28 233,800 MT UNK
- CROP PROGRESS – Harv 17% (LW – 11, Avg -26)
Ill – 21% (LW -11, Avg-38)
Ind – 16% (LW – 10, Avg – 23)
Iowa – 6% (LW – 6, Avg – 18)
- USDA QTLY STOCKS – 9/29
Corn Qtly Stocks 2,295 (Est-2,349 Sept 1,737)
- USDA 10/12 SUPPLY& DEMAND – will update production, yield & Carryout (domestic & world) – the better than expected yields reports Suggest the #’s will be ratcheted up again
It seems to us, from current levels, there’s considerably more upside potential than downside!
- The mkt is already on a 10 year low
- It’s been trading on 14-14.2 BB crop for several months
- Later-planted corn – as a result of all the dryness – May come in with lower yields
Much like its sister mkts, Dec Corn & Nov Beans, Dec wht has been range-bound (430-460) for the month of Sept – with conflicting fundamentals contributing to its “ebb & flow”!
- Despite earlier drought-like conditions in the Dakotas, the USDA raised Its wht forecasts for Spring wht & all wht in its QTLY report – Fri 9/29
- WW planting is behind at 36% (LW – 24, Avg – 43)
- Russia’s wht crop is still on tap to be a record
- The Australian & Argentine Crops have some issues – either too much rain Or not enough
Much like the grains, Dec Cat is also a victim of “Range-itis” – trading between $113 & $117 since mid-Sept! Once again bullish & bearish fundamentals have offset each other keeping prices range-bound!
- A week ago, both the cattle-on-feed & cold storage reports Were negative
- Higher 4th Qtr Production is weighing on the mkt
- Managed money traders are still net long 92,358 contracts – A real threat of “long liquidation selling”
- While Dec Cat languishes in a tight range, Dec Hogs have rallied $6 (low to high) since the bearish Pig Crop last week!
Dec Hogs put in a seasonal low in classic, dramatic fashion – when a bearish Pig Crop Report (9/29) ignited a near-vertical $6.00 rally & upside break-out – despite heavy production & sluggish export demand! It was a classic “buy the rumor – sell the fact” mkt action – as Dec Hogs apparently have already dialed in the big 4th QTR production increases expected!
Questions? Ask Bill Moore today at 312-264-4337
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Past results are not necessarily indicative of future results. Investing in futures can involve substantial risk of loss & is not suitable for everyone. Trading foreign exchange also involves a high degree of risk. The leverage created by trading on margin can work against you as well as for you, and losses can exceed your entire investment. Before opening an account and trading, you should seek advice from your advisors as appropriate to ensure that you understand the risks and can withstand the losses.
The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures. The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author. Trading in futures contracts, options on futures contracts, and forward contracts is not suitable for all investors and involves substantial risks. ©2017
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