** Money flows into commodity market "baskets" driving prices indiscriminately higher. ** Russian occupation of Crimea (Ukraine) putting risk premium in grain markets. ** Record 2013 crops still expected to hold extreme rallies (ie: north of $5 in any month) in check. ** Spec funds now long corn, "transferred" short to commercial to hedge increased farm sales. ** Ethanol margins back near record highs, profitable through summer. Livestock feeding profitable. ** March Quarterly Stocks & Acreage data in focus at end of month. Brazilian crop report out Wed AM.
A lack of anything extremely bullish prompted long liquidation after the release of the March WASDE Monday. As expected, the USDA raised US export projections, though the 25 million bushel increase fell short of many calls for a 50-100 million increase. That was the only change of note on the domestic side, and further eased US carryout to 1.456 billion bushels (vs. 1.8+ last Nov!). World numbers were actually leaning a little bearish - the USDA did not change Brazil or Argentine crop estimates, leaving them unchanged despite some private estimates that are running a combined 5 million metric tons (mmt) below USDA projections.
Brazil updates their thoughts tomorrow (Wed) AM. World corn carryout actually expanded 1 mmt, vs. expectations for a 1 mmt contraction, on the back of an increase in China's corn crop, which reduced that nation's ending stocks.
Overnight trade was quiet with a slightly lower bias, though we closed near unchanged at the AM break. Funds were net sellers of 14,000 contracts, though open interest only fell 1,300 contracts. The question is WWFD - what will funds do? Will they continue to pour hot money into commodities, or have they deployed most of it? Spring is in the air in the Midwest, with rising temps prompting optimism of freer grain transit - CIF basis bids backed off again overnight and are now more than a dime off last week's high. Farmer selling has largely shut off, but most interior bids are steady or maybe even a little lower, as purchases over the last month or two have given end-users at least 60 days cash coverage. In the export arena, South Korea tendered for corn today - Israel as in yesterday. Export Inspections yesterday were solid at 934,000 metric tons, in-line with expectations, but was 100,000 metric tons less than the prior week. YTD shipments are nearly double last year.
Friday's spike high has cooled off enthusiasm in corn for the moment. Cover shorts between here and the $4.70 area.
Consider scale-down buying corn for end-users and buy May Puts to hedge the position. May Puts will extend through the end-of- month trade data - April will not. If corn can rally back above $5; the next price count level is $5.20 in CK and $5.23 in CZ14.
We would advocate aggressive producer sales if we can manage to achieve said count.
End-user margins generally remain very strong for corn consumers - particularly in ethanol. However, outside factors have largely prevented much "extra" corn consumption. The PED Virus has killed an estimated 4 million baby pigs, while aforementioned rail transport issues have kept a lid on ethanol production, which is believed to be running at least 7% below potential. Something to keep in mind as we head towards the end of month Quarterly Stocks & Acreage data. Texas corn was pegged 10% planted vs. 18% average. 2 corn deliveries were put out overnight (trade date of 2/25).
NUTRIENT RICH SOLUBLE CALCIUM is now available at our rail terminal
in Herndon, PA. Micro-Cal+ provides a micro-nutrient calcium solution with
the potential to increase overall production, enhance fertilizer efficacy,
neutralize soil acidity, and build healthier, sustainable soils.
We offer MICRO-CAL+ NUTRIENT RICH SOLUBLE CALCIUM of the highest-quality
available. We seek to build trusted partnerships and maintain positive business
relationships while creating sustainable agricultural solutions.
Our success is built upon research and development, using sound scientific principles
and a dedication to developing an eco-friendly product. Our product is part of our full
commitment to your success and the environment. We invite you to learn more about MICRO-CAL+ NUTRIENT RICH SOLUBLE CALCIUM through this website and to
discover how adding soluble calcium can stimulate plant growth with
less fertilizer and help your bottom line.
Call us @ 8773434278 for pricing and availability.
For corn, the Department now has the US carryout at
1.456 billion bushels, 25 million less than its previous
estimate and compared with LaSalle Street’s estimates
that averaged 1.488 billion bushels ranging from 1.431-
1.656 billion bushels and hence to the low end of the
range. The smaller carryout came from a 25 million
bushel increase in projected exports, and no one was
surprised by that fact because exports have recently
been quite strong.
Concerning world corn figures the USDA pushed up its
projected world carryout to 158.47 million metric tonnes
from 157.30 million last month, to a great extend
obviating its lower US carryout. The Department had
been expecting to cut world corn ending stocks toward
156.3 million metric tonnes, ranging from 154.8-158.4
million. The USDA projected small increases in world
production and the carry-in to this crop year offset an
increase in projected feed use.
In all, this was a very boring report, but as a friend of
ours… the always helpful Mr. Charlie Sernatinger of
ED&FMan in Chicago… suggested, the markets rallied
sharply in recent weeks and “A bull market needs
constant feeding;” there was nothing “food-like” for the
bulls in yesterday’s reports and that means weaker prices
for the short, foreseeable future. They are weakening as
Please give us a call for current and in season
prices for all of your fertilizer needs. We have very
competitive prices on 30% UAN, Starter, MAP,
DAP, AMS, and Potash. We also offer custom
dry and liquid blends.
Last weekend, Indiana Grain CEO and Trade the Farm owner Tom Grisafi appeared once again on U.S. Farm Report to discuss the trader's perspective in today's commodities market.
"Our moves in corn are limited and so volatility has been hit," Grisafi explained, noting that volatility is the "fear factor."
"The conversation you would have had with a grower three or six months ago - hey, is there a chance we could go to $5, we might go to $6 - there's not many of those conversations now, Grisafi continued. Volatility is saying we're at a lower price level for a while."
To see what else Grisafi had to say about corn, soybeans, and markets in general, visit <a href="http://www.agweb.com/usfr/">The U.S. Farm Report</a> to view the segment in full.