Grain Commentary

January 23

CORN UP 4!  USDA announced a sale this morning of 141 tmt of old crop corn to unknown, 114.224 tmt of old crop corn to Guatemala and 29.724 tmt of new crop corn to Guatemala.  Support at the 50 Day MA at 3.835, we blew through resistance at 3.92 and bumped against the next level at 3.9375 already today.  Lots of farmers selling today, would not be a bad time to make a sale or price a few bushels on a basis contract. 

Beans… que the sad music.  Down again, 4 today-   bears seem to be watching bean harvest in Brazil.  No new bean sales to China to help stop the decline, they have closed down 4 out of the 5 last sessions (total -.15c in the last week).  Support at 9.03 and resistance at 9.21.  China’s Lunar New Year begins this Saturday, usually not a whole lot of news from them during this time.  New crop beans are at 9.45, not a bad place to start if you don’t have any on the books yet. 

Rumors flying about a trade deal with India, Pres. Trump is to visit India in February.  Little details lead to possibly a “mini deal” being revealed on the trip if anything at all.

January 3rd, 2020 Commentary by Ashton

Good morning! Happy Friday.

Shaky markets all around with a little feeling of being overbought from yesterday and the U.S. utilized drones in the killing of Iran military leader in Iraq. Grain news is limited again this morning so the middle east will grab everyone’s attention today.

Market still wants to go higher if we can get a deal signed and see a friendly report next week, but heading into the weekend I think we’ll see weaker numbers for the day.

The January WASDE report comes out next Friday, the 10th.

Unrelated to the markets- Today, January 3rd, will be my last day with CHS. I appreciate having had the opportunity to work with you all.
Thank you for the support and encouragement you have provided me during my time at CHS.
Even though I will miss my coworkers, customers and the company, I am looking forward to starting a new phase of my career.
Please keep in touch- I can be reached at my personal email address (ashtonragsdale18@gmail.com). Thanks again, it’s been a pleasure working with you.

Have a great and safe weekend!

CH first support at the 50-day MA at 385 ½, then 383 ¼. Next resistance at 392 ¼ – 395, then 400.
SH support at 946 ½, then 936 ½ – 930.  Resistance at from 967 – 970. 

Spreads:
CH/CK carry at 6 ¼ cents.
CH/CN carry at 12 cents.
SH/SK carry at 13 ¼ cents.
SH/SN carry at 25 ½ cents.

January 2, 2020 Commentary by Ashton

Good morning! Happy New Year! Corn and soybeans are expected to open slightly lower while wheat futures are mixed.  

Trade war updates are pretty well non-existent this morning as much of the U.S. government is on vacation yet, last we heard President Trump plans to sign the Phase 1 deal with high level Chinese reps on Jan 15th at the White House. A Tweet could change things quickly.

China changed customs regulations on imports of soybeans through some northern border checkpoints, this would ease the path of soybeans into China from Russian, Kazakhstan, and perhaps Ukraine.

Have a great and safe day!

Mar/May spread: 
Corn: 7 carry.
Jan/Mar spread:
Soybeans: 12 ½ carry.  

December 30th, 2019 Commentary by Ashton

Good morning! Corn is unchanged to slightly better while soybean and wheat futures are higher early Monday.

Trade talks with the Chinese remain mostly favorable. Phase 1 is expected to be signed sometime in January. Keep an eye on twitter for updates. China approved 2 new GM crops and renewed permits for 10 others. Soybeans, corn and canola are included as crops for import.

Weather forecasts for the US turning slightly drier for areas in the south and into the Delta limiting excess moisture / temperatures will be on the decline but most see limited winter kill threats at this time.

Reminder that it is a holiday shorten week / markets will be open for a full day session tomorrow before closing down until Thursday AM for a hard opening at 8:30 AM. 

Have a great and safe day!

Mar/May spread: 
Corn: 6 ¾ carry.
Jan/Mar spread:
Soybeans: 13 carry.

December 12th, 2019 Commentary by Ashton

Good morning! Corn and soybeans traded both sides before moving higher overnight. News was once again thin as we head into the last Friday trading session of the decade.

Rumors are circulating that China may significantly increase their US wheat purchases as part of the trade deal, maybe by 5-6 mmt.  Also supportive is uncertainty about world wheat production with Ukraine and Australia dry.

Please note: Grain futures will close at their regular 1:20pm CT next Tuesday, December 31st, and will not re-open until 8:30 am CT on Thursday, January 2nd.

Really not any fresh headlines out there, expecting an uneventful trade until after the holidays.

Have a great and safe weekend!

Spreads:
CH/CK carry at 6 ½ cents.
CH/CN carry at 12 ½ cents.
SF/SH at 8 ¾ cent carry. 
SH/SK carry at 13 ¼ cents.
SH/SN carry at 24 ¾ cents.

CH first support at 383 ½, then 382, then 377 ½. Closed right on the 100-day MA resistance at 388 ½, with next resistance at 390 ½, then 400.   
SH support at 936 – 936 ½, then 930 ¼.  Resistance at 951 ¼, then 955, then 970. 

December 26th, 2019 commentary by Ashton

Good morning! I hope everyone had a Merry Christmas yesterday. Fresh news will be limited as many areas remain on holiday and others are simply not willing to have risk at this time.

Recent positive headlines from both the US and China push the belief that a deal will be signed in the early part of January but as we have said, many remain cautious until then. 

As of Monday, USDA’s FSA had paid $10.707 billion in Market Facilitation Program 2 (MFP 2) payments to farmers.

Have a great and safe day!

CH first support at 384 ½, then 381 ½, then 377 ½. Resistance at the 100-day MA at 389 on a closing basis, then 390 ½, then 400.   
SF support at 924 ¼, then 918, then 911 ½.  Resistance at 940-942 ¼, then 960.

Spreads:
CH/CK carry at 6 ¾ cents.
CH/CN carry at 13 cents.
SF/SH at 8 ¼ cent carry. 
SF/SN carry into 32 ¾ cents

December 24th, 2019 Commentary by Ashton

Good morning! We have an abbreviated session today- markets will close at 12:05 CT. Corn remains unchanged while beans dip lower early Tuesday morning. Would expect today to be a slow trade day.

Weather forecasts remain overall favorable for most areas. Warmer and drier conditions for many areas in the US will allow some farmers to finish up harvest / areas in the north still could be covered with snow waiting for a few more days of favorable conditions.

The trade saw some private estimates on what the potential sales to China my look like after the Phase 1 deal is signed and brought a little bit of a surprise to some. The estimate showed in order what they highest demand from China will be with meats first, wheat second, corn third and coming in forth was beans. Have to remember that the ASF hit China probably much harder than was reported and feeding demand is not at the levels of normal .


Mar/May spread:  
Corn: 6 ¼ carry.
Jan/Mar spread:
Soybeans: 8 ½ carry. 

December 23rd, 2019 Commentary by Ashton

Overnight markets were a little more active than most anticipated but nothing drastic by any means

Weather forecasts for the US have brought much warmer conditions than normal allowing for many areas to finish up on the last of the corn acres in the fields – this should help cut back on possible cuts in yield and quality.

Other news is lacking so it will be a look out of any updates on estimates for the upcoming Phase 1 deal and what it may or may not include. Would believe that from the headlines and statements from high ranking officials, that a deal will be signed this time around. It will be interesting though to see how aggressive China is after the ink is dried

Have a great and safe day!

CH first support at 384, then 383 ¼, then 377 ½. Resistance at the 100-day MA at 389 ¼, then 390 ½, then 400.
SF support at 924 ¼, then 918 ½, then 911 ½. Resistance at 940, then 960.

Spreads:
CH/CK carry at 6 cents.
CH/CN carry at 12cents.
SF/SH into 9 ½ cent carry. Running out of time now.
SF/SN carry into 34 cents.

December 20th, 2019 Commentary by Ashton

Good morning! The start of the week brought a good, active trade but the past few sessions have been very quiet and uneventful trades with many stepping back to the sidelines.

Phase 1 news has been supportive and led the rally higher but traders remain cautious and willing to wait to see how things progress and what the fine print brings, some remain sidelined until the deal is signed.

Holiday trade is kicking into effect with traders gone after today for at least a week, many others will remain very close to home awaiting more details.

Have a great and safe day! Stay warm!

Spreads:
Corn:
H/K 6 ¼ carry
H/N 11 ¾ carry
Beans:
F/H 11 ¾ carry
F/N 36 ¾ carry

December 19th, 2019 Commentary by Ashton

Good morning! Back and forth we go this AM with minor bounces in the grains while beans are feeling a little pressure on a corrective pull back.

Phase 1 trade deal is the hot topic and will remain that way as we wait for further details and when the signing will happen- in the meantime many will hold tight and remain cautious until concrete answers are available.  It seems that some in the trade will continue to debate how China will be able to purchases $40 billion or more goods in one year from the US if cheaper offers remain in place.

Argentina has gotten some rain relief, but not enough to erase areas of dryness.  Northeastern Brazil remains dry.

Have a great and safe day, stay warm out there.

CH first support at 385, then 378 ½. Resistance at the 100-day MA at 390, then 392 ¼, the 400.   
SF support at 918 ¾, then 912 ½.  Resistance at 940, then 960.     

Spreads:
CH/CK carry at 6 ¾ cents.
CH/CN carry at 12 ½ cents.
SF/SH at 12 ½ cent carry. 
SF/SN carry at 37 ¾ cents. 

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