Bill Moore
About The Author

Bill Moore

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

Written 10/26/17

NOV SOYBEANS

Sterling exports have been doing battle with the harvest pressure of the US’s biggest ever bean crop (4.4 – 4.5 BB) – which has produced a sideways trade since mid-Aug – albeit with an upward bias!  With the harvest almost ¾ done, the “old wives tale” says the lows are in!  Exports will definitely outlast the harvest pressure!

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FACTORS IMPACTING THE MKT

  • EXPORTS – Mon Inspections were 2.5 MMT (1.3-1.9) – Thur sales Were 1.284 MMT (1.0-1.8)

10/29 –      198,000 MT         China

10/19 –      384,000 MT         China

10/16 –      227,300 MT         Unk

  • UDA’S CURRENT PRODUCTION ESTIMATES – based on the 10-12 Crop Report

Prod-   4.431 BB    (4.321-4.480)

Yield –  49.5 B/A    (48.5 – 50.2)

  • HARVEST PROGRESS – Beans are 70% in (LW-49, AVG – 73)

Ill – 77(73)    Ind – 69(67)   Iowa –   61(81)

  • TECHNICAL BREAK-OUT OFF 10/12 USDA REPORT?

Nov Beans managed a $10.00 close on Fri 10/13 on the heels of the USDA’s 10/12 report – a promising sign until “harvest pressure” reared its ugly head The following week – forcing a 25 cent correction in Nov Beans! Still the Mkt is hovering in the upper end of its range (950 – 1000) since Labor Day

  • RANGE-BOUND – since 9/1/17, various offsetting fundamentals have kept Nov Beans in a range (950-1000)- including harvest pressure, exports, South American planting weather & the US Dollar – however, the biggest “bear factor” – harvest pressure – is rapidly waning

With the crop almost 2/3 in, the Mid-Aug lows of $920 are in effect – HARVEST LOWS!  The mkt has witnessed higher highs & higher lows since then!

CORN

Whereas Nov Beans have been locked in a range with an upward bias, Dec Corn is in a pure sideways pattern since 9/1 (345-360)!  Exports support & harvest keeps a lid on!  The last two trading days epitomizes the “ebb & flow” of the range.  Last Fri, Dec Corn was “down & dirty” closing at 345 – its lowest of the season – then today, the mkt rebounded with a 6 ½ higher day – back into the middle of the range!

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FACTORS IMPACTING THE MKT

  • EXPORTS- Mon Inspections were 2.5 MMT (1.3-1.9) –Thur sales Were 1.284 MMT (1.0-1.8)

Oct 20 –        120,000 MT          Spain

125,000 MT          Unk

Oct 12           120,000 MT         Mexico

  • LATEST USDA ESTIMATES (10-12)

Prod  –           14,280 BB  (LY – 15,148)

Yield –            171.8  B/A (LY –  174.6)

  • HARVEST PRESSURE – % IN  38 (lw – 28   avg -59)

Ill – 62 (74)    Ind –  46 (59)    Iowa 23 (55)

  • SOUTH AMERICA – was too dry up North & too wet in the South – Delaying planting
  • CHEAP ENOUGH? Yes, the 3rd biggest crop ever – but the mkt has been Trading on that for several months & the 10 year low price level may Have factored in the 14-14.2 BB estimates

Would you rather sell a 10-year low or buy it? Isn’t it always “darkest before the dawn”?  Shouldn’t exports outlast the harvest pressure?

DEC WHEAT

Much like its sister mkts, Nov Beans & Dec Corn, Dec Wht continues to labor in a sideways trading pattern since Labor Day (425-460).  Dealing with not only record global stocks of its own, it is also taking on a record bean crop & the 3rd biggest corn crop ever! The mkt needs a bullish impetus such as strong exports & a weaker dollar!

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DEC CATTLE

After running up over $12 (107-119) since Mid-Aug, Dec Cat was certainly ripe for a healthy correction – especially considering its premium structure & the big production increases predicted for the 3rd-4th Qtr!  So, when we received a bearish Cattle-on-Feed Report last Friday 10/13 – followed by a negative Cold Storage yesterday, we thought for sure the mkt was headed SOUTH!  But alas, demand & strong cash mkt prevailed – the mkt eschewed the reports & today is only $.50 off its Oct highs!

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DEC HOGS

Much like its sister mkt Dec Cat, Dec Hogs has experienced a sharp upturn since late Sept (56-65) as solid demand & a strong cash have propelled the mkt into a premium position as well as an overbought status.  So, this contract, as well, was prime for a sharp correction & indeed we saw one off the two negative meat reports!  The difference was the demand factor as Pork imports were down 38% from last year!  But today Dec Hog recovered after a $2.50 correction off the top!

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