Soybean Complex Market Commentary for 8-23-10
November Soybeans ended up 1 1/2 at 1005 1/2, 7 up from the low and 5 1/4 off the high.
December Soymeal settled 1.8 higher at 294.9. This was 3.3 up from the low and 1.1 off the high.
December Soybean Oil finished down 0.27 at 39.82, 0.65 off the high and 0.02 up from the low.
November soybeans took out its previous day’s lows for the 4th straight day this morning before recovering to trade marginally higher in a narrow range through mid session and into early afternoon. Meal posted a modest gain versus a lower soy oil market. This came against a backdrop of moderate losses in crude oil and expectations that China will release edible oils in order to keep prices in check ahead of that country’s fall festivals. However, traders noted that selling was thin on the early break in both soybeans and meal amid light volume. This week’s export inspections for soybeans were 11.745 million bushels, down from 16.515 million last week. Inspections need to average 15.734 million bushels each week to meet the USDA’s export target for 2009/10. The USDA will issue its latest weekly Crop Progress report this afternoon, and some traders are looking for a small downgrade in the good-to-excellent rating for soybeans due to dry weather. That rating has been unchanged in recent weeks at 66.
Corn Market Recap for 8-23-10
September Corn ended down 4 at 417 1/4, 2 1/4 up from the low and 5 off the high. December Corn closed down 3 1/2 at 432 3/4. This was 4 3/4 off the high and 2 1/2 up from the low.
December corn traded mostly lower during most of the day session in a narrow range just below the highs of the past three trading sessions. This came on a day that the dollar firmed and wheat posted substantial gains, which in turn prompted some selling in corn by spreaders. Cooler weather is expected to continue over the Corn Belt into tomorrow, particularly in the NW and western regions, where highs are expected to be in the 70s. Weather is also generally drier to start the week than it was over the weekend, and the combination of lower temperatures and drier air is considered beneficial as early planted corn starts to approach harvest. This week’s export inspections for corn were 37.606 million bushels, up from 32.861 million last week. To reach the USDA’s export forecast for the remainder of the 2009/10 crop marketing year with ends on August 31st, inspections need to average 92.159 million bushels each week. The USDA will release its latest Crop Progress report this afternoon, and some traders are looking for a minor downgrade in the good to excellent quality rating. Last week’s rating dropped 2% from the previous week to 69%. Basis levels for corn at the Gulf were steady this morning.
November Ricefinished up 0.45 at 11.625, 0.225 up from the low and 0.025 off the high.
Wheat Market Commentary Report for 8-23-10
September Wheat ended 13 1/4 higher at 692 1/4, 15 up from the low and 4 3/4 off the high. December Wheat settledup 13 1/2 at 725 1/2. This was 4 1/4 off the high and 16 1/4 up from the low.
December wheat posted moderate gains early in the overnight session, and then extended those gains later in that session and into the start of the day session. Prices traded sideways, below the highs of the day session, into the close. Traders said that support today came from an extended period of rains in Germany that has hampered harvest progress there and has caused concern over the potential for erosion in quality. In addition, export demand continues to be seen by importers who traditionally rely on Black Sea origin supplies. Reports from Argentina indicate that cold and dry conditions there are hampering a later-than-usual planting season and also limiting early crop development. The late increase in plantings is in response to higher world prices, and President Fernandez says that production may be 12 to 13 million tonnes, up from last year’s drought-devastated total of near 7.5 million. This week’s export inspections for wheat were 21.474 million bushels, about in line with last week’s total. Inspections need to average 24.246 million bushels each week to reach the USDA’s export forecast for the 2010/11 crop marketing year. Wheat gained substantially on corn on the day amid moderately active trade by spreaders.
December Oats ended unchanged at 285. This was 4 3/4 off the high and 10 up from the low.
After reading today’s commentary,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.
The daily commentaries provide a review 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 next day’s schedule. Market commentaries for corn, wheat, soybeans, silver and gold are provided by CME Group. 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.
This blog is reported by Andy Waldock. Andy Waldock is a financial advisor, analyst, broker, asset manager and traderfor Commodity & Derivative Advisors, located in Sandusky, Ohio. Therefore, Andy Waldock may have positions for himself, his customers, or his relatives in any commodity future market discussed. The blog is meant to develop a dialogue and educate those with an interest in the commodity future markets. The commodity markets may not be appropriate for all investors due to the high degree of leverage. There is considerable risk in investing in commodity futures. If you are interested in reading other published 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.