CORN. July 29, Sep Corn Futures

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "CORN. July 29, Sep Corn Futures"

Transcription

1 CORN SIDEWAYS GRIND September corn chopped sideways this week, losing half a cent and settling at $ The crop continues to look better than normal and without any threatening weather in the forecast, the trade is just waiting to see what s actually out there. The funds have been sellers, adding to their small net short position in corn. Absent of any late season weather developments, corn likely drifts into a sideways channel between $3.20 and $3.75 for the next days. The August S&D report is due out the 12 th, which will reveal an updated yield estimate and get us closer to locking down the 15/16 carryout. After that, crop tours kick off, with many anxiously awaiting some hard data from the field. CROP PROGRESS / CONDITION Corn condition ratings remained unchanged again this week at 76% good/excellent. Improved ratings took place in 3 of the top 4 corn states, with Nebraska the only one to see a slight tick down. Ohio and South Dakota saw the biggest drop in ratings with a 4 and 3 point drop, respectively. Overall, conditions are much better than normal with the current ratings tracking with 2014, the year that produced a record bpa yield. Corn silking was listed at 79% vs 70% on average while 13% of the crop was listed in the dough stage, right on the 5 year average. Key states and their deviation from average in terms of good/excellent rating: NE (+13), IA (+18), IL (+29), MN (+15), KS (+27), IN (+25), OH (+8), MO (+26), and SD (- 8). (Chart courtesy of FC Stone) Sep Corn Futures July 29, 2016 ETHANOL Ethanol production fell from its lofty levels a week ago to 998k barrels/day, down from last week s record 1,029k. Stocks fell by 32 mln gallons (-3.6%), now down to their lowest level in 7 weeks. Overall, ethanol margins remain favorable which should continue to encourage steady production. Crude oil is down 21% since early June, which certainly impacts the profitability of the ethanol industry. Corn is down 26% over that same stretch, which has kept margins in good shape for ethanol processors. Despite this, the USDA s current 5,225 mbu ethanol demand target is at risk of being cut again in the upcoming August S&D report.

2 EXPORTS Corn export sales were within trade estimates this week as 17.3 mbu were reported. That total brings commitments to 1,917 mbu vs 1,855 mbu a year ago (3.4%). Total sales now exceed the USDA s 1,900 mbu export target. It s expected that old crop export demand increases some in the August S&D as these numbers would support. New crop export sales totaled 18.8 mbu this week, within market expectations. Corn shipments were in line with market ideas this week as 51.4 mbu were shipped. That number is right on pace with what is needed each week to hit the USDA s 1,900 mbu target for 15/16. However, should the USDA raise the export target in the August S&D, shipments will need to increase further from the current pace. So, if the USDA raises exports by mbu in a few weeks, the weekly pace would have to jump by 4-8 mbu. FUNDS Friday s Commitment of Traders (COT) report showed the funds trimming length and adding to short positions through trading last Tuesday. The funds can certainly press things further if they decide to, as the net short position is small at this point in time. The funds continue to pile on to the short wheat trade as managed money is short 130k contracts - near a record for the wheat crop. Negative news will need to continue to keep that position that large, otherwise wheat is primed for a short covering pop. Would corn follow a wheat rally? Yes, I believe it would find some support in that scenario. NEW CROP December corn formed a sideways channel this week as volatility and weather premium have been sucked out. The funds are building a net short position as the market attempts to figure out how big this year s corn crop will be. Good demand has helped stop the bleeding at current levels, though lower prices cannot be ruled out. The August Supply & Demand report is due out on the 12 th, and with that we will get an updated look at yield estimates. Typically the August report reveals the USDA s first yield revision of the summer, with many in the trade expecting a couple bushel increase this time around. With December Corn Futures the current crop conditions near all-time highs, the funds should be safe with their short positions for the time being. Producers who need to add to new crop sales should remain patient. As funds build their short position it creates opportunities for short covering rallies to develop. Macro market factors often trigger these types of moves as investors respond to risk and cross hedge type trades. Look for retracement levels back to the $3.75 area as opportunities to engage. HTA s at those levels can produce $4.00 July 17 futures if managed properly. Reach out to a member of the ProEdge team for details on how this can work for you! On the week, December corn added a penny to finish at $

3 BASIS Corn basis was steady to firmer this week as farmer selling remains extremely light. The theme hasn t changed for several weeks, though the calendar continues to creep closer to harvest. Basis may show some additional strength yet, but the risk-to-reward may not be worth getting too cute. Expect values to start softening up as we get to the 2 nd half of August. RECOMMENDATIONS Manage your old crop inventory by locking in basis values while they are firm yet. The risk in this category is to the downside as well. We may gain a nickel, yes, but I can confidently say we ll lose when it decides to break. Manage your risk-to-reward here on old crop stocks. Basis contracts allow you to lock in basis, deliver the grain, and keep your price open. Visit with your ProEdge rep for details on how this can work. CVA can do this for you at any of our elevators as well as direct ship destinations. One suggestion would be to execute this and then look for Bonus Premium opportunities on a retracement higher. $3.30 cash with an extra 20 cents from a Bonus Premium makes $3.50 attainable yet. Call for details! SOYBEANS FORK IN THE ROAD The soybean trade is approaching a fork in the road. Depending on how weather shakes out in the coming weeks soybeans could trade a dollar on either side of the current market. Fund length is still quite large in the soybean market, even after the $2.00 break from the June highs. Current crop conditions suggest a good one is coming at us, but market bulls are quick to point out that soybean ratings can be confusing last year s ratings were worse than 2010 and 2014 but produced a record yield. The macro markets are still impactful as some policy adjustments (or lack thereof) in Japan had some bearing on the US Dollar index Friday. On the week, August soybeans added 26 0 cents to settle at $ CROP PROGRESS / CONDITION Soybean conditions remained unchanged again this week at 71% good/excellent. Like corn, conditions are much better than recent history with 2014 the only year with a better rating for the comparable week. Most states saw steady to higher ratings week over week, including key states like IA and IL. KS and SD saw ratings decline by 4 and 5 points, respectively. Soybeans blooming stood at 76% vs 66% on average while 35% of the soybean crop is setting pods vs 26% on average. Key states and their deviation from average in terms of good/excellent rating: NE (+14), IA (+18), IL (+23), IN (+24), MN (+11), OH (+14), MO (+25), KS (+15) and SD (-4).

4 EXPORTS Soybean export sales were very disappointing this week as Thursday s report showed net cancellations of 1.4 mmt while the market was searching for something between mmt. The old crop book is now at 1,910 mbu vs 1,876 mbu a year ago (+1.8%). That number is well above the USDA s 1,795 mbu export estimate, though a good portion of these sales will likely be rolled into the 16/17 marketing year. New crop export sales of 24.9 mbu were reported this week, within the range of market ideas. Soybean shipments were the largest in 19 weeks this past week with 25.7 mbu reported. That number is well above what is needed each week to hit the USDA s 1,795 mbu estimate. Right now, sales are well above that number (read above), so the reality of what gets exported this year rests in the shipments number. Performances like the one this week could justify an export increase in the upcoming August S&D. FUNDS Friday s COT report surprised the trade when it revealed the managed money sector was as long as they were. Given the steep break in price over the past two weeks, many expected to see a much larger cut to the size of the fund long. The numbers indicate that through Tuesday last week, the funds still had over 109k contracts of net length. What does this mean for soybeans? They are more at risk of a deeper price break than what the trade thought towards the end of last week. If the weather doesn t provide some threatening conditions, we could see premium continue to be extracted. November futures with an $8 in front would not be out of the question and the road to that point will likely be a fast one. What the length does reveal is the market s appreciation for the tightness and demand pull taking place on the soybean balance sheet. The market needs a good crop to satisfy global protein demand. MACRO The US FED kept interest rates unchanged last week, contributing to some weakness in the US dollar on Friday. Additionally the Bank of Japan (BOJ) disappointed the market when it decided to make fewer adjustments to their stimulus efforts than what many were expecting. Interest rates were left unchanged at a negative 0.1% and asset purchases were not expanded beyond the current schedule. That move contributed to the pressure in the US Dollar Index, thereby supporting beans last Friday. In other macro news, Argentina appears to be wavering on their commitment to pull their soybean export tax down by another 5%. This was the campaign promise of now president Mauricio Macri, in which corn and wheat export taxes were abolished, and soybeans were expected to take several 5% drops over the span of several years. Newspapers in Argentina have indicated that the Minister of Agriculture and the

5 Argentine government are now second guessing the next 5% cut as it would have adverse impacts to government revenue. NEW CROP November soybeans had a positive finish to end the week as a variety of news created the right environment for a green day. Soybeans are still sensitive to the supply conversation as we enter pod fill in key production areas. The tightening old crop carryout has put pressure on this year s growing season to produce a very good crop. So far, that crop has avoided major issues, leading to some weather premium extraction in recent weeks. Still, the funds hold a sizeable long, longer than many thought, through trading last Tuesday. This suggests that soybeans are still at risk to lose another Nov Soybean Futures dollar if supply is perceived to be safe. On the other hand, a dollar could be added to the upside as well under the right weather scenario. Producers should ask themselves how many more soybeans need to be sold before the combine hits the field. Once you ve determined that, understand that weather premium exists for a few weeks yet. Beyond that and the supply side risk starts to wane. So, if you re in the boat of needing to add to pre-harvest sales, pay attention to price action leading up to the August S&D report. You may receive a good opportunity to get additional sales on. Targets would include retracement levels at $10.48 Nov futures followed by $ Expect the volatility to continue for several more weeks. On the week, November soybeans added 14 6 cents to settle at $ BASIS Soybean basis was firmer this week as old crop stocks get divvied up between counter seasonal export demand and the domestic processors. With the export program running strong, expect basis values to act a little bit like corn. As the calendar approaches September, values will want to retreat. Until then, values should remain supported. RECOMMENDATIONS Be a seller in the next 3-4 weeks if you need to add to sales. Soybeans are the only row crop commodity with excessive fund length yet, so the risk for further price erosion is there with the right weather forecast. Look to the retracement levels outlined above for targets. Simple offers have proven valuable in volatile times like this. Reach out to your ProEdge rep to get your orders ready and waiting!

6 WEATHER AUGUST MAPS Heat looks to be in the two week forecast, though moisture will be there to limit stress for a majority of the Belt. Temperatures look to peak on Tuesday this week before moderating into the 80 s the balance of the week. Further out, the 6-10 day suggests moisture will be above average in addition to higher temps. The latest one-month outlook from the National Weather Service shows above normal temps for the southeast portion of the Belt while moisture looks to be above average for key production areas, including Nebraska. At this stage, soybeans will reflect changes in the forecast and be more susceptible to larger price swings. Corn is a follower with most of this season s weather risk in the rearview. Risk Disclosure -The risk of loss in trading commodities can be substantial and past performance is not necessarily indicative of future results. Therefore, you should carefully consider whether such trading is suitable for you or your organization in light of your financial condition. Any examples given are strictly hypothetical and no representation is being made that any person will or is likely to achieve profits or losses similar to those examples. Neither the information, nor any opinion expressed shall be construed as an offer to buy or sell any futures or options on futures contracts.

January USDA Report & Market Highlights

January USDA Report & Market Highlights January 2015 USDA Report & Market Highlights Corn Summary When the dust cleared, slightly friendly corn report with the USDA taking 2.4 bpa/191 mbu off its yield/production estimate. C/O 121 lower at 1.877

More information

FCStone Grain Recap July 9, 2015

FCStone Grain Recap July 9, 2015 CORN: Values higher throughout the day on heavy volume as traders anticipate USDA s Friday S&D update and speculate on US crop problems. Weekly export sales of 535,000 tons vs 363,000 tons of old crop

More information

Market will worry about demand later Weekly Corn Review for May 11, 2016 By Bryce Knorr

Market will worry about demand later Weekly Corn Review for May 11, 2016 By Bryce Knorr Market will worry about demand later Weekly Corn Review for May 11, 2016 By Bryce Knorr USDA didn t do much to help the corn market in its May 10 reports other than give soybeans a big lift. That could

More information

By Tom Leffler and Larry Glenn

By Tom Leffler and Larry Glenn www.lefflercom.com Friday, April 29, 2016 By Tom Leffler and Larry Glenn TODAY S THOUGHT Motivation is what gets you started. Habit is what keeps you going IMPORTANT SURVEY: Let Larry or I know if you

More information

USDA Acreage and Quarterly Grain Stocks Reports

USDA Acreage and Quarterly Grain Stocks Reports USDA Acreage and Quarterly Grain Stocks Reports June 30, 2016 Aaron Smith and Chuck Danehower Department of Agricultural & Resource Economics University of Tennessee Extension USDA Acreage and Quarterly

More information

2013 World Grain Outlook

2013 World Grain Outlook 2013 World Grain Outlook Presented by: John Roach February 18, 2013 Disclaimer: Futures/options trading involves substantial risk of loss and trading may not be suitable for all investors. You should fully

More information

Iowa Farm Outlook. New Data Indicates Lower Retail Meat Prices

Iowa Farm Outlook. New Data Indicates Lower Retail Meat Prices Iowa Farm Outlook November 1, 2002 Ames, Iowa Econ. Info. 1849 New Data Indicates Lower Retail Meat Prices As part of the Mandatory Price Reporting legislation in 1999 Congress directed USDA to develop

More information

Weekly Corn Commentary for the Week Ending 9/11/15 By Jalen Pietig, Grain Originator/Field Marketing Advisor. Corn Weekly Change.

Weekly Corn Commentary for the Week Ending 9/11/15 By Jalen Pietig, Grain Originator/Field Marketing Advisor. Corn Weekly Change. Weekly Corn Commentary for the Week Ending 9/11/15 By Jalen Pietig, Grain Originator/Field Marketing Advisor Highlights: 167.5 bushels per acre is the magic number USDA estimated as the national average

More information

September 2016 Crop Market Update Public Policy Department Budget & Economic Analysis Team

September 2016 Crop Market Update Public Policy Department Budget & Economic Analysis Team September 2016 Crop Market Update Public Policy Department Budget & Economic Analysis Team U.S. and Foreign Stockpiles Remain Elevated John Newton, Ph.D., (202) 406-3729, jnewton@fb.org USDA s September

More information

We have seen in the How

We have seen in the How : Examples Using Hedging, Forward Contracting, Crop Insurance, and Revenue Insurance To what extent can hedging, forward contracting, and crop and revenue insurance reduce uncertainty within the year (intrayear)

More information

CROP REVENUE COVERAGE INSURANCE PROVIDES ADDITIONAL RISK MANAGEMENT WHEAT ALTERNATIVES 1

CROP REVENUE COVERAGE INSURANCE PROVIDES ADDITIONAL RISK MANAGEMENT WHEAT ALTERNATIVES 1 Presented at the 1997 Missouri Commercial Agriculture Crop Institute CROP REVENUE COVERAGE INSURANCE PROVIDES ADDITIONAL RISK MANAGEMENT WHEAT ALTERNATIVES 1 Presented by: Art Barnaby Managing Risk With

More information

Commodity Marketing Quiz

Commodity Marketing Quiz 1 Commodity Marketing Quiz DePutter Publishing Ltd. How much do you really know about the markets? Are your risk management skills as sharp as they should be? With this quiz, you ll find out where you

More information

Chapter Five: Risk Management and Commodity Markets

Chapter Five: Risk Management and Commodity Markets Chapter Five: Risk Management and Commodity Markets All business firms face risk; agricultural businesses more than most. Temperature and precipitation are largely beyond anyone s control, yet these factors

More information

Iowa Farm Outlook. November 2016 Ames, Iowa Econ. Info Pasture and Range Conditions and Prices: A Year in Review

Iowa Farm Outlook. November 2016 Ames, Iowa Econ. Info Pasture and Range Conditions and Prices: A Year in Review Iowa Farm Outlook 0BDepartment of Economics November 2016 Ames, Iowa Econ. Info. 2079 Pasture and Range Conditions and Prices: A Year in Review This year the U.S. has enjoyed favorable pasture and range

More information

FCStone Grain Recap January 6, 2016

FCStone Grain Recap January 6, 2016 CORN: CH16 made new contract lows but were unable to hold below unchanged into the close. Weekly ethanol production marginally higher this week, up 4 thbpd to 996. Ethanol stocks built again reaching 21099

More information

July 10, USDA World Supply and Demand Estimates

July 10, USDA World Supply and Demand Estimates July 10, 2015 - World Supply and Demand Estimates Corn Projected 2015/16 U.S. feed grain supplies are lowered this month with reductions in corn beginning stocks and production. Corn beginning stocks for

More information

FCStone Grain Recap October 1, 2015

FCStone Grain Recap October 1, 2015 CORN: A choppy but firm market today. Today starts the march of the private crop estimates led off with FCStone s number this afternoon. Export sales reported today showed net bookings of 748.2 tmt as

More information

USDA Acreage and Quarterly Grain Stocks Reports, June 30, University of Tennessee Extension Aaron Smith and Chuck Danehower

USDA Acreage and Quarterly Grain Stocks Reports, June 30, University of Tennessee Extension Aaron Smith and Chuck Danehower Market Reaction USDA Acreage and Quarterly Grain Stocks Reports, June 30, 2015 University of Tennessee Extension Aaron Smith and Chuck Danehower On Tuesday June 30 th the USDA surprised the market releasing

More information

Research Commodities El Niño returns grains and soft commodities at risk

Research Commodities El Niño returns grains and soft commodities at risk Investment Research General Market Conditions 20 May 2015 Research Commodities El Niño returns grains and soft commodities at risk Meteorologists now agree that El Niño has arrived and project that it

More information

Risks Associated With Marketing

Risks Associated With Marketing Risks Associated With Marketing November, 2013 Federal Reserve Bank of Chicago Market Risk (Price Risk) is Always Present Two Components Solution Futures Price Risk Basis Risk (Cash price relative to futures

More information

Section III Advanced Pricing Tools

Section III Advanced Pricing Tools Section III Learning objectives The appeal of options Puts vs. calls Understanding premiums Recognizing if an option is in the money, at the money or out of the money Key terms Call option: The right,

More information

Using Futures Markets to Manage Price Risk for Feeder Cattle (AEC 2013-01) February 2013

Using Futures Markets to Manage Price Risk for Feeder Cattle (AEC 2013-01) February 2013 Using Futures Markets to Manage Price Risk for Feeder Cattle (AEC 2013-01) February 2013 Kenny Burdine 1 Introduction: Price volatility in feeder cattle markets has greatly increased since 2007. While

More information

Advance Trading Inc Merchandising Seminar. The Warehouse Industry

Advance Trading Inc Merchandising Seminar. The Warehouse Industry Advance Trading Inc Merchandising Seminar The Warehouse Industry How does the marketplace assure the consumer an adequate supply of grain all year? Consumption January-December October Production How does

More information

CBOT Soybean Crush. Reference Guide

CBOT Soybean Crush. Reference Guide CBOT Soybean Crush Reference Guide Introduction In the soybean industry, the term crush refers both to a physical process as well as a value calculation. The physical crush is the process of converting

More information

Implications for US Corn Availability under a Higher Blending Rate for Ethanol: How Much Corn Will Be Needed?

Implications for US Corn Availability under a Higher Blending Rate for Ethanol: How Much Corn Will Be Needed? Implications for US Corn Availability under a Higher Blending Rate for Ethanol: How Much Corn Will Be Needed? Summary Increasing the amount of biofuel that can be blended into gasoline will contribute

More information

MGEX Agricultural Index Futures and Options

MGEX Agricultural Index Futures and Options MGEX Agricultural Index Futures and Options 07 Crop Outlook and Int l Durum Forum Minot, ND 1 Thank you very much for having me here. I would like to acquaint you with a new set of risk management tools.

More information

12 OPTIONS STRATEGIES FOR AN UNCERTAIN WORLD

12 OPTIONS STRATEGIES FOR AN UNCERTAIN WORLD 12 OPTIONS STRATEGIES FOR AN UNCERTAIN WORLD A guide to using tools designed for capturing opportunity and protecting against risk. America s farmers are resilient. In spite of the many risks they face,

More information

Nivesh Commodity. Daily Change & Technical levels. Comex Division. 6 th October, Bullions (Spot) Last close % change

Nivesh Commodity. Daily Change & Technical levels. Comex Division. 6 th October, Bullions (Spot) Last close % change Nivesh Commodity 6 th October, 2016 Daily Change & Technical levels Base Metal Inventory Scrip Inventory Change Copper 365050-3475 Nickel 360558-906 Lead 190775 375 Zinc 452875 5325 Alumni 2141875-6400

More information

The Risk/Reward Properties of Bull Spreads

The Risk/Reward Properties of Bull Spreads The Risk/Reward Properties of Bull Spreads ThE RiSk/REWaRD PRoPERTiES of BUll SPREaDS Bull Spreads are versatile instruments. They can be used to trade direction, to trade volatility or, in conjunction

More information

3.3 Real Returns Above Variable Costs

3.3 Real Returns Above Variable Costs 3.3 Real Returns Above Variable Costs Several factors can impact the returns above variable costs for crop producers. Over a long period of time, sustained increases in the growth rate for purchased inputs

More information

KSU Agriculture Today Radio Notes

KSU Agriculture Today Radio Notes KSU Agriculture Today Radio Notes Daniel O Brien, Extension Agricultural Economist, Kansas State University For Radio Program to be aired 10:00-10:15 a.m., Friday, September 30, 2016 I. Grain Futures Closes,

More information

Navigating the complex world of options

Navigating the complex world of options Navigating the complex world of options Brian Grete Sr. Market Analyst, Pro Farmer The Basics of Options: Calls vs. Puts Call options: An option that gives the buyer the right, but not the obligation,

More information

Grain Marketing 101. University of Maryland Extension

Grain Marketing 101. University of Maryland Extension Grain Marketing 101 Jenny Rhodes Shannon Dill John Hall Extension Educators, Agriculture & Natural Resources Marketing terminology CBOT futures Basis Contracts Forward Contract Hedge to Arrive Basis Contract

More information

A Summary of the USDA s Prospective Plantings and Grain Stocks Report

A Summary of the USDA s Prospective Plantings and Grain Stocks Report A Summary of the USDA s Prospective Plantings and Grain Stocks Report March 31, Aaron Smith and Chuck Danehower Department of Agricultural & Resource Economics University of Tennessee Extension A Summary

More information

DAILY SOY COMPLEX COMMENTARY 08/17/16

DAILY SOY COMPLEX COMMENTARY 08/17/16 Wednesday August 17, 2016 150 S. Wacker Dr., Suite 2350 Chicago, IL 60606 800-621-1414 or 312-277-0102 info@zaner.com www.zaner.com DAILY SOY COMPLEX COMMENTARY Surge in soyoil and oversold grains may

More information

Principles of Hedging with Futures

Principles of Hedging with Futures MARKETING & UTILIZATION Cooperative Extension Service Purdue University West Lafayette, IN 47907 NCH-47 Principles of Hedging with Futures Chris Hurt, Purdue University Robert N. Wisner, Iowa State University

More information

SELL NOW? Burt White Chief Investment Officer, LPL Financial Jeffrey Buchbinder, CFA Market Strategist, LPL Financial

SELL NOW? Burt White Chief Investment Officer, LPL Financial Jeffrey Buchbinder, CFA Market Strategist, LPL Financial LPL RESEARCH WEEKLY MARKET COMMENTARY September 12 2016 SELL NOW? Burt White Chief Investment Officer, LPL Financial Jeffrey Buchbinder, CFA Market Strategist, LPL Financial KEY TAKEAWAYS This year s stock

More information

DAILY FINANCIAL & COMMODITY MARKET NEWS

DAILY FINANCIAL & COMMODITY MARKET NEWS DAILY FINANCIAL & COMMODITY MARKET NEWS FOR NEWSLETTERS, PUBLICATIONS, WEB SITES, SCRIPTS Writing daily market summaries is hard. It is exacting and time-consuming. Accuracy has to be 100%. Dozens, or

More information

Five Steps in Developing a Successful Marketing Plan

Five Steps in Developing a Successful Marketing Plan Five Steps in Developing a Successful Marketing Plan David Reinbott Agriculture Business Specialist P.O. Box 187 Benton, MO 63736 (573) 545-3516 http://extension.missouri.edu/scott reinbottd@missouri.edu

More information

The basic concepts of grain price options

The basic concepts of grain price options Grain Price Options Basics File A2-66 January, 1996 The basic concepts of grain price options are discussed below. Methods of using grain price options to market grain are presented in: Options Tools to

More information

Commodity Pricing Software

Commodity Pricing Software Commodity Pricing Software The main objective of this software is to provide farmers with an objective viewpoint of their potential risk and returns from selling or buying commodities while hedging their

More information

Index futures contract features. Contract features. MGEX Agricultural Index. MGEX Agricultural Index Futures and Options

Index futures contract features. Contract features. MGEX Agricultural Index. MGEX Agricultural Index Futures and Options MGEX Agricultural Index Futures and Options 1 MGEX Agricultural Index Futures and Options Five agricultural indexes futures and options contracts: National Corn Index (NCI) National Soybean Index (NSI)

More information

Lower Rates Mean Lower Crop Insurance Cost 1

Lower Rates Mean Lower Crop Insurance Cost 1 Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

More information

Managing Feed and Milk Price Risk: Futures Markets and Insurance Alternatives

Managing Feed and Milk Price Risk: Futures Markets and Insurance Alternatives Managing Feed and Milk Price Risk: Futures Markets and Insurance Alternatives Dillon M. Feuz Department of Applied Economics Utah State University 3530 Old Main Hill Logan, UT 84322-3530 435-797-2296 dillon.feuz@usu.edu

More information

Market Monitor Number 3 November 2012

Market Monitor Number 3 November 2012 Market Monitor Number 3 November 2012 AMIS Crops: World Supply-Demand Balances in 2012/13 World supply and demand situation continues to tighten for wheat and maize but rice and soybeans have eased. In

More information

Understanding and Using Basis - Grains

Understanding and Using Basis - Grains Understanding and Using Basis - Grains By: E. Dean Baldwin Reviewers: John Ferris and David Holder Edited by Duane Griffith and Stephen Koontz 1 Basis is defined as the amount in cents per bushel a specified

More information

ADVANCED COTTON FUTURES AND OPTIONS STRATEGIES

ADVANCED COTTON FUTURES AND OPTIONS STRATEGIES ADVANCED COTTON FUTURES AND OPTIONS STRATEGIES Blake K. Bennett Extension Economist/Management Texas Cooperative Extension, The Texas A&M University System INTRODUCTION Cotton producers have used futures

More information

Part Three Major Opportunities Exist for U.S. and Canadian Beef Producers For (1) Those Who Start Paying Much Closer Attention to What Consumers are

Part Three Major Opportunities Exist for U.S. and Canadian Beef Producers For (1) Those Who Start Paying Much Closer Attention to What Consumers are Part Three Major Opportunities Exist for U.S. and Canadian Beef Producers For (1) Those Who Start Paying Much Closer Attention to What Consumers are Spending Their Stretched Protein Dollars on and Why

More information

General Information Series

General Information Series General Information Series 1 Agricultural Futures for the Beginner Describes various applications of futures contracts for those new to futures markets. Different trading examples for hedgers and speculators

More information

A BULLISH CASE FOR CORN AND SOYBEANS IN 2016

A BULLISH CASE FOR CORN AND SOYBEANS IN 2016 A BULLISH CASE FOR CORN AND SOYBEANS IN 2016 Probabilities for higher prices, and the factors that could spur price rallies. Commodity markets tend to move on three variables: perception, momentum and

More information

In 2010, many farmers will again choose between farm

In 2010, many farmers will again choose between farm 2010 The New ACRE Program: Costs and Effects By Brian C. Briggeman, Economist, Federal Reserve Bank of Kansas City and Jody Campiche, Assistant Professor, Oklahoma State University In 2010, many farmers

More information

Commodity products. Self-Study Guide to Hedging with Grain and Oilseed Futures and Options

Commodity products. Self-Study Guide to Hedging with Grain and Oilseed Futures and Options Commodity products Self-Study Guide to Hedging with Grain and Oilseed Futures and Options In a world of increasing volatility, CME Group is where the world comes to manage risk across all major asset classes

More information

AGRICULTURE UNDERSTANDING BASIS

AGRICULTURE UNDERSTANDING BASIS AGRICULTURE UNDERSTANDING BASIS General ContentsInformation Series Understanding Basis..................................... 2 Keeping History........................................ 6 Putting Basis to

More information

Options Combinations & Strategies. Andrew Wilkinson

Options Combinations & Strategies. Andrew Wilkinson Options Combinations & Strategies Andrew Wilkinson 1 Disclosure of Risk Options involve risk and are not suitable for all investors. For more information, read the Characteristics and Risks of Standardized

More information

Understanding New Generation Grain Contracts November, 2005

Understanding New Generation Grain Contracts November, 2005 Understanding New Generation Grain Contracts November, 2005 Developed by: Steven D. Johnson, Ph.D. Farm & Ag Business Management Field Specialist Introduction Grain marketing and related cash and futures

More information

LT Options Trading System

LT Options Trading System LT Options Trading System By Henrik Santander www.the-lazy-trader.com, All Rights Reserved An options trading system based on Credit Spreads and Iron Condors in indexes. Copyright 2015 by The Lazy Trader

More information

COMMODITIES. CBOT Soybeans vs. DCE Soybean Meal and Soybean Oil Crush Spread

COMMODITIES. CBOT Soybeans vs. DCE Soybean Meal and Soybean Oil Crush Spread COMMODITIES CBOT vs. DCE and Soybean Oil Spread JULY 2015 CBOT SOYBEANS VS. DCE SOYBEAN MEAL AND SOYBEAN OIL CRUSH SPREAD A key component in the soybean market is what is known as the crush spread. are

More information

What is Grain Merchandising, Hedging and Basis Trading?

What is Grain Merchandising, Hedging and Basis Trading? Grain Merchandising What is Grain Merchandising, Hedging and Basis Trading? Grain merchandising describes the process of buying and selling grain. Agribusiness firms that merchandise grain include grain

More information

Introduction to Futures Markets

Introduction to Futures Markets Agricultural Commodity Marketing: Futures, Options, Insurance Introduction to Futures Markets By: Dillon M. Feuz Utah State University Funding and Support Provided by: Fact Sheets Definition of Marketing

More information

Chicago Federal Reserve Bank Agriculture Investment Conference

Chicago Federal Reserve Bank Agriculture Investment Conference Chicago Federal Reserve Bank Agriculture Investment Conference INVESTING IN AMERICA S HEARTLAND Perry Vieth, President Firm Overview Investment objective Ceres Partners, LLC Best-in-class identification,

More information

The Fall Run: Cull Cows & Trading Calves

The Fall Run: Cull Cows & Trading Calves Canfax Research Services A Division of the Canadian Cattlemen s Association Publication Sponsored by: A lot happens during the fall run and the decisions made now determine if a cow/calf operation is profitable

More information

NADEX BINARY OPTIONS 101

NADEX BINARY OPTIONS 101 NADEX BINARY OPTIONS 101 TABLE OF CONTENTS 03 TO BE OR NOT TO BE? THAT S A BINARY QUESTION. 04 LET S LOOK AT AN EXAMPLE. 06 WHO SETS A BINARY OPTION S PRICE? AND HOW? 07 PRICE REFLECTS PROBABILITY. 07

More information

Wednesday- May 11, 2011

Wednesday- May 11, 2011 Wednesday- May 11, 2011 June Dow Jones Long from 12720 last price @ 12724 The Dow Jones futures have formed a bullish reaction swing above the ascending median line. This is a bullish signal pattern and

More information

Basis The Cash Futures Relationship

Basis The Cash Futures Relationship Agricultural Commodity Marketing: Futures, Options, Insurance Basis The Cash Futures Relationship By: Dillon M. Feuz Utah State University Funding and Support Provided by: Fact Sheets Knowing and Managing

More information

2010 Risk and Profit Conference Breakout Session Presenters. 9. Marketing Grain Using a Storage Hedge

2010 Risk and Profit Conference Breakout Session Presenters. 9. Marketing Grain Using a Storage Hedge Orlen Grunewald 2010 Risk and Profit Conference Breakout Session Presenters 9. Marketing Grain Using a Storage Hedge Orlen Grunewald is a professor in the Department of Agricultural

More information

Hedging strategies aim to reduce price risk

Hedging strategies aim to reduce price risk April 2014 INSIGHTS Hedging strategies aim to reduce price risk AgriThought AgriBank provides financial solutions to meet the needs of production agriculture in America s heartland. We feature our research

More information

Audience Response Cards 2/13/2013. Operating with Today s Land Values. Outline for today: Know how. Know now. Know how. Know now. Know how. Know now.

Audience Response Cards 2/13/2013. Operating with Today s Land Values. Outline for today: Know how. Know now. Know how. Know now. Know how. Know now. Operating with Today s Land Values Prepared by: T. Lemmons & A. Vyhnalek Adapted from: B. Johnson. (2012). Nebraska Farm Real Estate Market Report. UNL Extension Presented by: Allan Vyhnalek 402 563 4901

More information

Yield Protection Crop Insurance will have the same Yield Coverage as Revenue Protection, but RP is Expected to be the Preferred Choice (Updated) 1

Yield Protection Crop Insurance will have the same Yield Coverage as Revenue Protection, but RP is Expected to be the Preferred Choice (Updated) 1 Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

More information

Common Crop Insurance Policy (CCIP) DR. G. A. ART BARNABY, JR. Kansas State University 4B Agricultural Consultants

Common Crop Insurance Policy (CCIP) DR. G. A. ART BARNABY, JR. Kansas State University 4B Agricultural Consultants Common Crop Insurance Policy (CCIP) DR. G. A. ART BARNABY, JR. Kansas State University 4B Agricultural Consultants Phone: 785-532-1515 EMAIL: barnaby@ksu.edu Check out our WEB page at http://www.agmanager.info

More information

Soybean Supply and Demand Forecast

Soybean Supply and Demand Forecast Soybean Supply and Demand Forecast U.S. soybean planted acreage is expected to increase 11.5 million acres over the forecast period. U.S. soybean yields are expected to increase 7 bushels per acre or an

More information

June Stocks & Seedings Analysis

June Stocks & Seedings Analysis June Stocks & Seedings Analysis June Corn Stocks Pegged at 3.743 Billion Bushels, up 977 Mil Bu from Last Year Mar-May Corn Quarterly S & D 11/12 12/13 13/14 Carryin 6,023 5,400 7,006 Imports 11 40 7 Total

More information

USDA Grain Stocks and Acreage Reports - June 30, 2014 University of Tennessee Extension Aaron Smith and Chuck Danehower

USDA Grain Stocks and Acreage Reports - June 30, 2014 University of Tennessee Extension Aaron Smith and Chuck Danehower USDA Grain Stocks and Acreage Reports - June 30, 2014 University of Tennessee Extension Aaron Smith and Chuck Danehower Acreage Report USDA Summary: Corn planted area for all purposes in 2014 is estimated

More information

Nivesh Commodity. Daily Change & Technical levels. Comex Division. 30 th December, Bullions (Spot) Last close % change

Nivesh Commodity. Daily Change & Technical levels. Comex Division. 30 th December, Bullions (Spot) Last close % change Nivesh Commodity 30 th December, 2016 Daily Change & Technical levels Base Metal Inventory Scrip Inventory Change Copper 331100 2750 Alumni 2183675 6875 Lead 195750 50 Zinc 427850 475 Nickel 371280 126

More information

Introduction to Options. Commodity & Ingredient Hedging, LLC www.cihedging.com 312-596-7755

Introduction to Options. Commodity & Ingredient Hedging, LLC www.cihedging.com 312-596-7755 Introduction to Options Commodity & Ingredient Hedging, LLC www.cihedging.com 312-596-7755 Options on Futures: Price Protection & Opportunity Copyright 2009 Commodity & Ingredient Hedging, LLC 2 Option

More information

Marketability: Exchange rates How they work and affect revenues

Marketability: Exchange rates How they work and affect revenues Annex A Marketability: Exchange rates How they work and affect revenues 1. Overview The value of the Canadian lobster industry is determined by several factors: resource abundance; the capacity of the

More information

SP500 September 2011 Outlook

SP500 September 2011 Outlook SP500 September 2011 Outlook This document is designed to provide the trader and investor of the Standard and Poor s 500 with an overview of the seasonal tendency as well as the current cyclic pattern

More information

INTRODUCTION TO COTTON FUTURES Blake K. Bennett Extension Economist/Management Texas Cooperative Extension, The Texas A&M University System

INTRODUCTION TO COTTON FUTURES Blake K. Bennett Extension Economist/Management Texas Cooperative Extension, The Texas A&M University System INTRODUCTION TO COTTON FUTURES Blake K. Bennett Extension Economist/Management Texas Cooperative Extension, The Texas A&M University System Introduction For well over a century, industry representatives

More information

What Percent Level and Type of Crop Insurance Should Winter Wheat Growers Select? 1

What Percent Level and Type of Crop Insurance Should Winter Wheat Growers Select? 1 Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

More information

FUTURES TRADERS GUIDE TO THE WASDE

FUTURES TRADERS GUIDE TO THE WASDE FUTURES TRADERS GUIDE TO THE WASDE Your Guide To Understanding The USDA World Agriculture Supply & Demand Estimates For Corn, Soybeans And Wheat By Craig & Drew Daniels 1.800.800.3840 What Is The WASDE?

More information

Agricultural Commodity Marketing: Futures, Options, Insurance

Agricultural Commodity Marketing: Futures, Options, Insurance Agricultural Commodity Marketing: Futures, Options, Insurance By: Dillon M. Feuz Utah State University Funding and Support Provided by: On-Line Workshop Outline A series of 12 lectures with slides Accompanying

More information

THERE IS RISK OF LOSS IN FUTURES FOREX, ETF, & STOCK TRADING

THERE IS RISK OF LOSS IN FUTURES FOREX, ETF, & STOCK TRADING Issue Number: 951 Insider Capital Group Jun 17, 2013 COT Jun 11, 2013 Price Week Fund Week Current Fund Trend PAGE Table Key Page 10 Jun 17, 2013 Bullish Review Page 1 Primary Cycles Major Minor Commercial

More information

Understanding Volatility and Making It Work for You. The Options Industry Council

Understanding Volatility and Making It Work for You. The Options Industry Council Understanding Volatility and Making It Work for You December 16, 2013 Joe Burgoyne, OIC www.optionseducation.org 2 The Options Industry Council Options involve risks and are not suitable for everyone.

More information

US Imported Beef Market A Weekly Update

US Imported Beef Market A Weekly Update US Imported Beef Market A Weekly Update Prepared Exclusively for Meat & Livestock Australia - Sydney Volume XVI, Issue 24 June 29, 2016 Prepared by: Steiner Consulting Group SteinerConsulting.com 800-526-4612

More information

Advanced Marketing Tools And Strategies For Producers

Advanced Marketing Tools And Strategies For Producers Advanced Marketing Tools And Strategies For Producers Amarillo, Texas Presented by: Darrell Holoday President Advanced Marketing Concepts Plus Advanced d Marketing February 26, 2010 Darrell Holaday dholaday@amcplus.com

More information

Fertilizer is a world market commodity, which means that supply

Fertilizer is a world market commodity, which means that supply Supply & demand, Energy Drive Global fertilizer prices The Fertilizer Institute Nourish, Replenish, Grow Fertilizer is a world market commodity necessary for the production of food, feed, fuel fiber. &

More information

Small Business Credit Outlook

Small Business Credit Outlook 2014 Q4 Small Business Credit Outlook The Growth Engine in 2015 Stock market volatility and GDP growth slowing to 2.6% lead many to believe the economy is stumbling. This problem can be attributed to a

More information

Corn Prices and Cattle Feeding Where to From Here?

Corn Prices and Cattle Feeding Where to From Here? 1913 1917 1921 1925 1929 1933 1937 1941 1945 1949 1953 1957 1961 1965 1969 1973 1977 1981 1985 1989 1993 1997 2001 2005 2009 Corn Prices and Cattle Feeding Where to From Here? Dr. Tom Elam, President,

More information

Coffee prices fall to 18-month low as supply concerns fade

Coffee prices fall to 18-month low as supply concerns fade Coffee prices fall to 18-month low as supply concerns fade The coffee market registered further decreases in July with prices reacting to the depreciation in the Brazilian exchange rate, which dropped

More information

Hedging: To buy or sell a futures contract on a commodity exchange as a temporary substitute for an intended later transaction in the cash market.

Hedging: To buy or sell a futures contract on a commodity exchange as a temporary substitute for an intended later transaction in the cash market. Section I Learning objectives Register for Commodity Challenge and join an open game Understanding your challenge Ground rules for trading in Commodity Challenge Illustrate a simple hedge with futures

More information

New Era Marketing 2015

New Era Marketing 2015 Know how. Know now. New Era Marketing 2015 It s Not A Game Anymore Using Seasonal Trends to improve returns University of Nebraska Lincoln Know how. Know now. Know how. Know now. The image cannot be displayed.

More information

Futures Contract Basic Strategies

Futures Contract Basic Strategies Futures Contract Basic Strategies 1 WHY TRADE FUTURES CONTRACT ON COMMODITY? The primary purpose of the futures market is to allow those who wish to manage price risk (the hedgers) to transfer that risk

More information

REviewing the previous week & LAYing the groundwork for the week ahead

REviewing the previous week & LAYing the groundwork for the week ahead REviewing the previous week & LAYing the groundwork for the week ahead System Trade Updates Taken from Corresponding Issues of Weekly Re-Lay Information is from sources believed reliable but accuracy cannot

More information

Risk / Reward Maximum Loss: Limited to the premium paid up front for the option. Maximum Gain: Unlimited as the market rallies.

Risk / Reward Maximum Loss: Limited to the premium paid up front for the option. Maximum Gain: Unlimited as the market rallies. Bullish Strategies Bullish options strategies are employed when the options trader expects the underlying stock price to move upwards. It is necessary to assess how high the stock price can go and the

More information

Tapioca Chip/pellet Usage Trend in Thailand s Feed Industry

Tapioca Chip/pellet Usage Trend in Thailand s Feed Industry 1 Tapioca Chip/pellet Usage Trend in Thailand s Feed Industry By Thai Feedmill Association In the face of unprecedented hike in feed ingredients prices at present, feed producers have to adjust their feed

More information

Grain and Livestock Commentary Wednesday January 04, 2017 DAILY SOY COMPLEX COMMENTARY 01/04/17. Flooding on unplanted Argentina growing areas; firm

Grain and Livestock Commentary Wednesday January 04, 2017 DAILY SOY COMPLEX COMMENTARY 01/04/17. Flooding on unplanted Argentina growing areas; firm Grain and Livestock Commentary Wednesday January 04, 2017 DAILY SOY COMPLEX COMMENTARY Flooding on unplanted Argentina growing areas; firm OVERNIGHT CHANGES THROUGH 6:05 AM (CT): SOY BEANS +0.6, BEAN OIL

More information

Grain Futures Markets & National Cash Indices Review & Observations thru July 27, 2012 PHI Market Analysis Manager Virg Robinson

Grain Futures Markets & National Cash Indices Review & Observations thru July 27, 2012 PHI Market Analysis Manager Virg Robinson Grain Futures Markets & National Cash Indices Review & Observations thru July 27, 2012 PHI Market Analysis Manager Virg Robinson S&P 500 FUTURES NEAR BULLISH BREAKOUT The S&P 500 futures monthly continuation

More information

or Agricultural Risk Coverage?

or Agricultural Risk Coverage? JULY 2014 INSIGHTS Price Loss Coverage or Agricultural Risk Coverage? AgriThought AgriBank provides financial solutions to meet the needs of production agriculture in America s heartland. We feature our

More information

First Quarter 2015 Earnings Conference Call. 20 February 2015

First Quarter 2015 Earnings Conference Call. 20 February 2015 First Quarter 2015 Earnings Conference Call 20 February 2015 Safe Harbor Statement & Disclosures The earnings call and accompanying material include forward-looking comments and information concerning

More information

Pricing Scenarios/Purchasing Opportunities Paul Dubravec, Advance Trading, Inc.

Pricing Scenarios/Purchasing Opportunities Paul Dubravec, Advance Trading, Inc. Pricing Scenarios/Purchasing Opportunities Paul Dubravec, Advance Trading, Inc. Export Sorghum: The Smart Choice for Feed Grain Solutions June 11, 2015 Houston, Texas Introduction to ATI Advance Trading,

More information

18 th November Base Metals Monthly

18 th November Base Metals Monthly Outlook Base Metals: For the coming month, we expect base metal prices to trade on a mild negative side due to expectations that there are higher chances of around 90 percent probability of US rate hike

More information