December 6th, 2019 Commentary by Ashton

Good morning! You guessed it! After negative headlines from Chinese officials yesterday, positive headlines on the trade war front today have increased hope that a trade deal is close to being reached and possible by year end.

December 15th tariffs are on the table but with China removing tariffs on soybeans and pork, would expect that if a deal is not reached by the key date, President Trump will delay them as a good faith move much like China has overnight. 

Weather wise the US will see a few more rains but keeping a more southern path – areas in the north will be hindered by snow coverage and a strong cold push in temperatures next week – most are expecting sharp drops in temps but remain above the winterkill threshold – corn harvest will increase gradually but many areas in the north will remain out of the fields for now.

Have a great and safe weekend!

Mar/May spread:
Corn: 6 carry.
Jan/Mar spread:
Soybeans: 14 ½ carry.

December 4th, 2019 Commentary by Ashton

Good morning! Back and forth the trade goes as we watch for any fresh updates on the ticker. Corn, soybean and wheat futures are higher to start the day.

News source Bloomberg posted a headline that stated the US and China maybe closer to a Phase 1 deal than most have been talking and that a deal could be reached before the December 15th date when tariffs look to kick in. The positive headline has popped markets up.

Weather forecasts for the US will continue to hinder progress in the northern areas as snow and cold temps keep farmers out of the fields. Estimates on Monday showed that there remains sizable corn acres left to be picked and it could be well into the first quarter before completion if weather doesn’t comply.

Have a great and safe day!

Mar/May spread: 
Corn: 6 carry.        
Jan/Mar spread:
Soybeans: 14 ½ carry.

-CH support at 379 ¼, 373, then 366 ½.  Resistance moves up to 382 ½ on a closing basis, then 384 ¾.  
-SF support at 865, then 843.   Resistance at 889.   

December 3rd, 2019 Commentary by Ashton

Good morning! Corn futures are slightly lower, soybean and wheat futures are trading higher early Tuesday.

Pres. Trump said it might be better to wait until after the election for a trade deal with China, but that China wants a deal now, so we’ll see if the deal is going to be right.  He said he has no deadline for a deal.  Additional US tariffs on Chinese goods, including laptops and smart phones, are scheduled to go into effect December 15th.

Progress reports were out yesterday evening with corn harvest pegged at 89% completed leaving some 4 million acres left to be harvest – chatter increasing that completion for corn could be well into the 1st quarter which would have a draw down on yield potential. Soybeans were estimates at 96% completed which is on par.

Weather forecasts here in the states will are leaning drier for areas in the Delta and Midwest allowing for progress or finishing up in many areas over the next two weeks – areas in the north and Great Lakes regions will continue to be hindered by snow and ice causing field work to be put on hold for a while now. 

Have a great and safe day!

Spreads:
Mar/May spread:
Corn: 4 ¾ carry.   
Jan/Mar spread:
Soybeans: 14 ½ carry. +1/4 

-CH support at 378 ¾, 373, then 366 ½.  Resistance moves up to 382 ½ on a closing basis, then 386 ½.
-SF support has now dropped to 865, then 843.   Resistance where after 8 consecutive lower closes?   

December 2nd, 2019 Commentary by Ashton

Good morning! It’s a new week and month but nothing has really changed. Corn and wheat markets are mixed while soybeans are higher in early trade.

Headlines over the weekend show that negotiations are on going but retaliation was noted as China stopped any US military vessels for visits but as well demanded that President Trump remove existing tariffs for a Phase 1 deal to be signed.  Time will tell on what President Trump will do and if he will be willing to bend previous statements that he will leave tariffs in effect even after a deal is signed to make sure that China is living up to their side of the bargain.

On the weather front the US will see mostly dry conditions allowing many areas to proceed with harvest in hopes of finishing up over the next few weeks or before year end. Areas in the north and parts of the Midwest will see more snow push through causing further delays with some talking corn harvest finishing up next year some time. Harvest estimates will be out this afternoon with corn pegged around 90% completed while beans should be in the final few percentages.

Traders wait any update, headline, tweet regarding the Phase 1 deal with traders hoping and trying to stay optimistic that a deal can be reached before years end. 

Have a great and safe day!

Spreads:
Mar/May spread:
Corn: 4 ¼ carry. +1/4
Jan/Mar spread:
Soybeans: 14 1/2 carry.

CH support at 378 ¾, 370, then 366 ½.  Resistance moves up to 382 ¾, then 386 ½.
SF support moves down to 872, then 865, then 843.   Resistance at 897 ¾ – 900, then the 100-day MA at 910 ¼.   

CHS Board announces fiscal 2019 equity management decisions

CHS will return $180 million in cash patronage and equity redemptions to its owners based on fiscal 2019 earnings.

Of that $180 million, $90 million will be distributed in cash patronage and $90 million will be distributed through equity redemptions.

  • Of the $90 million in equity redemptions, $63 million will be returned to member cooperatives and $27 million to individual members.
    • The $27 million in redemptions of individual producer member equity will be provided based on qualifying requests from individual members (estates and age 70+).
(more…)

November 25th, 2019 Commentary by Ashton

Good morning! Strength noted to start the holiday week as traders are viewing headlines as positive from both the US and China over the weekend.

Broken record is seems like but again, fresh news is limited! Some sources say Phase 1 of the trade deal is near completion and there’s commitment while others are saying Phase 1 of the deal won’t be completed until next year and it’s looking less likely there will be a Phase 2 before 2020 elections. Just depends on who you read and how it gets spun. This morning they want to say the glass is half full.

Poor weather headed into the Midwest this week will disrupt any harvest still going on.  Look for more crops than usual left in the field until conditions improve.

Have a great and safe day!

This week’s market schedule:
-Normal close on Wednesday at 1:20  /  no trading session Wednesday night
-Closed all day Thursday
-Hard opening on Friday AM at 8:30 AM / markets close at Noon central time / post session traded until 12:05

Dec/Mar spread: 
Corn: 9 ¾ carry.
Jan/Mar spread:
Soybeans: 14 ¼ carry.

-CZ support at 366 ¾, then closer to 360-353.  Resistance at 371 ½ – 377 ¾.   
-CH support at 376 ¾ on a closing basis, then 366 ½.  Resistance short term at 381 – 382 ¾, then 386 ¾.
-SF  support at 896-894 was tested last week, with next support at 878.   Resistance at the 100-day MA at 912, 200-day MA at 917 ½, then 50-day MA at 926.  

November 22nd, 2019 Commentary by Ashton

Good morning! It has been consistent all week long that the market is working off very little fresh news. Back and forth we go on the headlines as we have seen for the past year and half.

High ranking officials from China state that they would like to reach a deal with the US but will stick to what they demands are for now and if tariffs are increased by the US, they will react accordingly. President Trump this AM in an interview stated that the Phase 1 deal is very close and could be reached sometime soon.

On to weather, here in the states we will see more rains and potential flooding for areas in the Delta and southeast. Delays are noted for many areas has heavy coverage will keep farmers out of the fields. Areas in the north and west will see temps drop quickly freezing soils and allowing for some harvest progress for corn.

Have a great and safe weekend!

Spreads:
Dec/Mar spread:
Corn: 10 ½ carry.
Jan/Mar spread:
Soybeans: 14 carry.

-CZ support at 366 ¼, then closer to 360-353.  Resistance at 371 ½ – 377 ¾.    —CH support at 376 ¾ on a closing basis, then 366 ½.  Resistance short term at 382, then 386 ¾.
-SF  support at 901 on a closing basis, then 896-894.   Resistance at the 100-day MA at 912, 200-day MA at 917 ½, then 50-day MA at 926.  

Friday Afternoon Recap:
Boy, like watching paint dry in corn and soybeans today. Holiday mode will set in next week if it hasn’t already. There is no fresh news to discuss. There are still many negative attitudes and beliefs rallies can’t hold. That’s all I have for now, enjoy your weekend!

A little Thanksgiving history:  in 8 out of the last 9 years, December corn has closed lower the day after Thanksgiving, including 6 out of the last 6 years; not really any good correlation for the day before Thanksgiving. 
For January soybeans, it has closed higher the day before Thanksgiving in all 4 of the last 4 years, no good correlation for the day after Thanksgiving.

November 21st, 2019 Commentary by Ashton

Good morning! Surprise!  Positive headlines out last night in regards to trade negations have spilled into the grain markets giving support into the end of the night session.

US officials will be heading to Beijing to start high end discussions with other ranking officials in China before next week’s holiday. Looks as if China made the request for the meeting which is telling the trade that there is some urgency being felt on their side but would imagine that President Trumps office is feeling it as well in light of impeachment proceedings, upcoming tariffs and just the need of a victory before years end.  These are just headlines yet again and we will continue to digest anything fresh that comes across the ticker

Weather wise, we are seeing some heavy rains push through areas in the central belt moving east ward and around the Great Lakes. Further delays are expected from these large rains while more coverage will be noted in areas of the north. Corn harvest looks to be push further down the road and well into December before completion. 

Have a great and safe day!

Spreads:
Dec/Mar spread: 
Corn: 10 ¼ carry. +1/4 
Jan/Mar spread:
Soybeans: 13 ¾ carry. +1/4  

CZ support barely held at 365 ¾.  Next support closer to 360-353.  Resistance at 373 – 377 ¾.   
CH support at 377 on a closing basis, then 366 ½.  Resistance short term at 382 ½, then 386 ¾.
SF  support at 901, then 896-894.   Resistance at the 200-day MA at 918, then 50-day MA at 926.  

November 20th, 2019 Commentary by Ashton

Good morning! Corn and wheat markets are lower while soybeans are higher early Wednesday. Look for choppy sideways trade until we some solid trade news from the U.S. and China. Feels like we are going into the holiday mode.  

President Trump said yesterday that “he will see what happens” in regards to a deal, and he reiterated that if a deal can’t be made then he will just raise the tariffs even higher. This morning there was discussion on linking the size of tariff rollbacks to the preliminary terms set in that failed with the May deal, the amount is up for debate but a 35-60% has been talked about

Traders are watching weather forecasts and harvest updates here in the states. Good field work has been noted but will start to run into delays as snow in the north and rains in the south will hinder progress in the mean time, more coverage in the 6 – 10 day will cause delays to corn pushing completion well into December.



Dec/Mar spread:
Corn: 10 ½ carry.     
Jan/Mar spread:
Soybeans: 13 carry.

November 19th, 2019 Commentary by Ashton

Good morning! Dare we say “Turnaround Tuesday”? Corn and soybeans are seeing a technical bounce. The back and forth trade is expected throughout the day session.

Updates on the Phase 1 deal are limited but continued to be noted are daily discussions in hope of a deal to be reached by December 15th when the next round of tariff increases are expected / Trump has not stated whether he will make any changes on the tariffs / China remains cautious on guaranteed quantities in the deal as well on tariffs / it’s the same story just a different day as no concrete answers are available and traders are getting tired of chasing one headline to the next.

A wetter forecast for the US will slow harvest progress that’s already behind and limit any dry-down in the field.


Spreads:
Dec/Mar spread:
Corn: 9 ¾ carry
Jan/Mar spread:
Soybeans: 13 carry.  

CZ support at 366. Resistance at 375 ½ – 378, the 50-day MA at 381 ¼.
CH support at 378. Resistance short term at 384 ½, 386 ¾, then 392 (50-day MA).
SF support at the 100-day MA 912 ½ was breached today, putting next support at 901, then 896-894. Resistance at the 50-day MA at 925, 930 ¼, then 959 ½.

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