Tag: Grain Markets

10 Dec 2024

Agriculture, CME, Corn, Education, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: NOVEMBER 18 – DECEMBER 10

Corn has had a good month but needs some more help to get over the $4.50 hump that it bumped against after Tuesday’s Dec USDA report. The bullish trade leading into the report was hoping the USDA would find better numbers for ethanol and US exports, but they underestimated the demand numbers with the US ending stocks coming in 168 million bushels below estimates for US stocks. World stocks were also lower by 268 million bushels. While these stocks numbers are still very strong, they have tightened enough to raise the floor for the meantime while corn could trade between $4.30-$4.55 heading into the new year.

Soybeans’ last few weeks of trade between $9.80 and $10 has not provided much bullish optimism. There were no surprises in the Dec USDA report as large South American crop expectations and the US bean carryout doubling from 2023 are still bearish influences. Soybeans have a tough road ahead as South America is on pace to produce another record crop, and the incoming administration will likely not be biofuel friendly in the US. With all the recent investments in biodiesel and sustainable aviation fuel, there is a cloud that hangs over those areas that we are not sure if it is nothing and will blow over or a storm that may linger.

Equity Markets

The equity markets have continued higher with some recent weaknesses in the largest stocks while strength in the market has broadened. Analysts are beginning to release their outlooks for 2025, while plenty still feel good about the market do not expect another year of 20+% returns like we saw in ’23 and ’24 (so far) after the down year in ’22.

Other News

The Assad regime in Syria is over. Israel and Hamas appear close to reaching a temporary ceasefire. The fallout of both will be watched by energy markets as many questions will emerge in the region.
There was a slight cut to US wheat stocks, but world stocks are as expected, and comfortable as low Russian cash prices continue to reflect their ample supplies.

Drought Monitor

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

29 Oct 2024

Agriculture, Corn, Dow Jones, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: OCTOBER 4 – 29

Corn has been range-bound the last 2 months between $4 and $4.40. With no weather issues during harvest following a very dry end of the growing season, the market did not get any unexpected help to push it higher. Mexico continues to buy US corn at a fast pace, appearing again in the export reports. With no major problems starting the year in South America and smooth sailing to the finish of US harvest there does not appear to be anything to give this market a boost. Expect technicals to play a major role in the direction of the trade for the near term as the fundamental trade will be reliant on harvest news.

Soybeans weakness over the month has lowered it with corn. Beans do not have any bullish news on the horizon as they failed to rally through technical resistance. With the election next week, a tariff war with China would hurt beans in an already depressed market as we have seen in the past. Funds are very short and will need a catalyst to get them to change course, which currently is lacking. Bean harvest is 89% complete which means there won’t be much opportunity for unexpected bullish news moving forward.

Equity Markets

The equity markets continue higher as the biggest week of earnings kicks off. The Fed is expected to cut rates again by the end of the year, but inflation and jobs data are sending a mixed picture. The 10-year US treasuries have moved higher since the rate cut as the market is questioning whether or not the Fed will get it right.

Other News

China announced that total grain production this year would be a record 700 million metric tons. As China continues to increase domestic production of edible commodities while continuing to invest in South America the US needs to find a new partner to replace their demand as they continue to try and be less reliant on American agriculture.
Crude Oil has been volatile but has moved lower this week as possible easing tensions in the Middle East as cease fire negotiations restart.
With the election results potentially being unknown for a few days following November 5 there could be some volatility in all markets.
The October insurance averages are $4.16 1/2 for corn and $10.06 for beans as of 10/29. The February insurance averages were $4.67 for corn and $11.60 for beans.

Drought Monitor

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

07 Oct 2024

Agriculture, CME, Corn, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: SEPTEMBER 12 – OCTOBER 4

Corn’s rally back to $4.25 has been welcome heading into harvest as South America’s weather started off a little weary but have added rains to the upcoming forecast. The US drought to end growing season does not appear to have impacted the corn crop very much. Export demand has picked up putting us ahead of the USDA annual projections. The recent rally has taken corn above other major exporters which will likely lead to slowing exports unless South American weather becomes more of a concern. Harvest has gotten off to an average start with 21% harvested as dry weather shouldn’t cause any problems in the next week.

Soybeans faded to end the week as harvest progress and pressure lead to profit taking after the recent rally. The biggest news related to soybeans, non harvest related, is that congress seems to be working on bipartisan legislature to address the importing of used cooking oil while still collecting tax credits. The American farmer wants this loophole closed to force biofuel producers in the US to use domestic production. This will lead to millions of more bushels used at crush facilities in the US throughout the year with a major question of, what happens to the bean meal? The longer congress and the lobbying associations take on this legislature will lead to more frustration among farmers across the country so with it being an election year I would be careful with what gets “leaked” by parties involved. The end of year drought across much of the US likely led to a smaller crop as pods did not get the moisture needed for max fill. Bean harvest is slightly ahead of expectations at 26% to start the week of Sept 30.

Equity Markets

The equity markets continue to roll hitting new all-time highs as Fed rate cuts and the likelihood of a soft landing becomes higher. The market has broadened out but the biggest names (Nvidia, Meta, etc) are still doing well. With rates lowering over the next year expect money that has been getting 5%+ in fixed income to begin to move back into the market. Chinese stimulus prompted a large rally in Chinese stocks this week as they try to get their economy going again.

Other News

The Fed announced a 50-basis point rate cut this month, cutting rates for the first time since the Pandemic. More rates are expected into the end of the year.
Tensions in the Middle East escalated as Iran launched attacks on Israel. Israel is expected to respond but how and when remain unknown, with attacks on oil fields a possibility crude oil rallied over the week.
Hurricane Helene caused massive devastation in the United States Southeast over the weekend causing loss of life and destruction of major infrastructure. The total amount of damage is still unknown, but it will take the mountain communities a long time to recover.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

12 Sep 2024

Agriculture, CME, Corn, Futures, Grain, Hedging, Market Commentary, Market Updates, Other News, Research, Risk Management, Soybeans, USDA Report, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: AUGUST 26 – SEPTEMBER 12

Corn has gotten back above $4.00 in a struggling market that needs good news to propel it back to the mid $4s. The USDA raised US corn yield to 183.6 bu/ac up from 183.1 bu/ac in last month’s report. In the USDA’s eyes the crop is getting bigger as struggling areas will be more than made up for by the best areas across the corn belt. Despite the higher US yield numbers, the corn trade following the report was welcome to see as it did not move much lower on larger numbers. If corn can bounce off or hold this $4 level then we can probably expect it to hang around here as planting gets rolling until we know what is actually in the field and if the numbers are closer to 180 or 183.6.

Soybeans have seen a nice 50+ cent rally off recent lows with dryness in areas causing a little concern with pod fill and some pickup in demand. The USDA kept yield the same at 53.2 bu/ac as they agree with Pro Farmer tour that a massive crop is out there. Like corn, this recent bounce off lows is encouraging but may setup a range bound trade until harvest gets rolling and we have a better idea on the true yield. The USDA did slightly lower US ending stocks in both 23/24 and 24/25. Continued exports and any issues to South American planting are needed to drive beans higher in the current market.

Equity Markets

The equity markets have been on a bit of a roller coaster lately with the tech/semiconductor trade having quite a bit of volatility while some rotation occurs with the Fed rate cuts expected to begin this month.

Other News

The market is expecting a 25 basis point cut to the Fed Funds rate this month

Wheat

Wheat has been the one positive market lately, hitting new 2-month highs. The war in Ukraine and Russia continues to escalate and the market has responded accordingly. The USDA did not make any major changes in the report.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

26 Aug 2024

Agriculture, CME, Corn, Futures, Grain, Hedging, Market Commentary, Market Updates, Other News, Research, Risk Management, Soybeans, U.S. Dollar, Weather, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: AUGUST 12 – 26

Corn’s continued weakness following the August USDA report. Pro Farmer completed their crop tour last week and see the US yield being 181.1 bu/ac and a total 14.979-billion-bushel production. With another record crop expected this year, the market is continuing lower as plenty of 2023 corn remains in storage needing to be moved before this year’s harvest gets underway. The end of month heat is not expected to do much damage to the corn crop, but this crop is not done yet and still needs some more rain to get to the finish line. While demand is improving in the commodity space with a weaker USD, the large supply is still driving prices lower for the time being. There is not any major news to keep an eye on coming up except export and weather news.

Pro Farmer found a massive crop in their tour last week estimating the 2024 US bean crop at 54.9 bu/ac(!!) and 4.74-billion-bushel total production. This soybean yield would easily be a record and would justify the collapse in bean prices seen this year. The current heat will likely stress the crop a bit, making that big a yield unlikely, however we should still expect to see a record crop, like corn. Soybeans need some good news in the form of demand whether that be from exports or the sustainable fuel market to get this thing turned around without production concerns in South America.

Equity Markets

The equity markets have rallied back to recent highs after a small correction with the Yen carry unwind and some market broadening out of tech. With earnings season coming to an end markets will trade on economic data and any election surprises after Nvidia this week.

Other News

Fed chairman Powell spoke in Jackson Hole last week and set up for the Fed to begin cutting rates next month.
The Canadian rail strike started and seemingly ended quickly with the government stepping in and saying that arbitration will decide negotiations.
Wheat’s summer trend lower from the $7.59 high looks to continue as it is not getting any help from other commodities to pull it up.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

12 Aug 2024

Agriculture, CME, Corn, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: JULY 22 – AUGUST 12

Corn moved lower in the last couple weeks to trade around $4 heading into the August 12^th USDA report. While the market saw small gains after the report, the numbers will continue to put pressure on corn as a record crop is headed our way. The August report has the US crop with a 183.1 bpa, 15.147-billion-bushel production, with good weather in the forecast there is not much to push this market higher currently. While these numbers are more bearish than expected, the market response to finish higher is a welcome sight after another move lower.

Beans have very little positive news behind them as you can see from the chart. The US yield was bumped to a would be record of 53.2 bpa while harvested acres were 1.2 million acres higher than the trade was expecting, neither are good for prices. Brazil planting will get rolling in about a month with acreage expansion expected again. With prices this low, the acreage expansion will not be as straight forward as in the past but with no weather issues here or in South America there is not much supporting beans. Corn and beans would both greatly benefit from funds getting out of some short positions.

Equity Markets

The equity markets have been volatile over the last couple weeks with last Monday seeing some huge swings in global equity markets. With rate cuts expected in September and a big week of economic news we should get a better idea of what to expect heading into the election.

Other News

Election years add another wrinkle in the markets as Kamala Harris’ campaign has been off to a fast start naming Minnesota Governor Tim Walz as VP running mate ahead of the DNC in Chicago next week.
Escalation in war in Israel/Gaza and Ukraine/Russia will be worth keeping an eye on as it could lead to issues in global energy supply.
Wheat numbers were slightly bullish in the report with production and stocks below estimates

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

22 Jul 2024

Agriculture, CME, Corn, Dow Jones, Futures, Grain, Hedging, Market Commentary, Market Updates, Other News, Research, Risk Management, Soybeans, USDA Report, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: JULY 8 – 22

Corn has consolidated in the $4 to $4.20 range since July 8 even with the USDA report. The USDA did not release any major updates to production as they let expected US yield at 181 bu/ac but it did have lower ending stocks for the next 2 years with increased old crop exports and increased feed demand. This bullish news was not enough to put a fire behind corn as the US crop this year remains on record breaking pace with the great weather start to the year. The forecasts to start the week were adjusted for a warmer drier US starting this week than initially thought, lifting markets.

Beans seemed to find a near term bottom last week trading into the low $10.30 range. The sharp rally to start the week was a welcome sign with the largest up day for the Nov contract in at least the last 6 months. The USDA made minimal changes to soybeans in their update while adding demand to offset potentially record yields in the US. As we head into the back half of summer the bean market will trade on export demand from China and US weather.

Equity Markets

The equity markets have shown volatility in July as several mega cap stocks that had been driving the market fell last week while small cap stocks saw their best week in years. The market is expecting rate cuts in September and the moves of last week appear to be repositioning within the market as funds space out their funds more away from the biggest stocks.

Other News

President Joe Biden announced he would not seek reelection in November and put his support behind Kamala Harris to be the Democrats nominee. The DNC is in Chicago next week where unless a challenger pops up, she will become the nominee.
An assassination attempt on former president and current GOP nominee Donald Trump occurred at a rally last week after a gunmen fired on him at the event hitting his ear and killing someone in attendance.
The Ag markets will pay attention to the election as tariffs and trade wars (potentially from both candidates) are on the table.
Cotton continues its weakness drifting lower as the US is trending towards a large crop at this point in the year with weak demand from the global market.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

08 Jul 2024

Agriculture, CME, Corn, Grain, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: JUNE 14 – JULY 8

Corn had the bottom fall out of it after trading between $4.60 and $5 from March to June. The USDA last week pegged the US corn crop at 91.475 million acres, over 1 million acres higher than the trade estimate. The USDA did make a note that those were the reported acres at the time of the survey so there is a good chance not all those acres end up getting planted. The crop ratings are currently better than last year’s at this time that led to a record crop and with no major weather concerns on the horizon and rains from Beryl expected to help some areas in the ECB later this week. With no major weather concern in the US or abroad right now, corn will need to find help in demand or fund buying as ending stocks remain high.

Beans seemed to find a slight rally heading into the 4^th of July before having a sharply lower start to the week, falling below $12 in the November futures contract. While the corn acreage number was bearish the soybean acres came in at 86.1 million acres (below the trade estimate of 86.783). The June 1^st stocks number was slightly higher, but the markets could not find a catalyst higher. With no major weather issues on the horizon beans will need the funds to get out of their short positions while the charts still look bearish.

Equity Markets

The equity markets have remained strong as they continue to set new highs. The market is looking to broaden after being very top heavy the first half of the year. With an election and possible rate cuts in the second half of this year, the market will have plenty of information outside of earnings to watch for.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

14 Jun 2024

Agriculture, CME, Corn, Cotton, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weather, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: MAY 31 – JUNE 14

Corn’s small 18 cent rally off recent lows for new crop corn has been very welcome after 6 down days in a 7-day period to end May and start June. This week’s USDA Report was a non-event with the USDA making no changes to South Americas production from last month despite the trade expecting production well below the USDA’s estimate of 175 mmt (171.82 estimated). CONAB released their estimates on Thursday, increasing their estimates for Brazil’s corn crop but still 310 million bushels below what the USDA is saying. The heat over the next couple of weeks is not expected to be a major problem but if this level of heat with a lack of rain goes into July the markets would take notice and begin to worry a bit.

Beans are lower over the last 2 weeks with them settling into a flat trade this week. The USDA report was uneventful despite the USDA cutting another 1 mmt from Brazil’s bean crop. US exports were revised lower and ending stocks rose as the slow pace of exports continued. With no major surprises and no major weather/production issues yet there is not much bullish news outside of CONAB’s Brazil production estimate which is 207 million bushels below this week’s USDA update.

Equity Markets

The S&P 500 and NASQDAQ continue to move higher setting new all-time highs as several large tech companies beat on earnings. The AI movement is continuing its dominance, but some other areas are starting to find strength as funds are forced to reposition.

Other News

The cotton market continues lower as there is nothing bullish in the news cycle for it other than the potential for up to 25 named hurricanes this year.
Wheat’s roller coaster ride continues with potential for lower Black Sea production still a possibility after the $1.50+ rally follows by a $1 fall with 10 down days in a row.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

03 Jun 2024

Agriculture, CME, Corn, Education, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weather, Weekly Prices rcmagserv 0 comment

AG MARKET UPDATE: MAY 10 – 31

Corn had a rough week as planting is nearly wrapped up and the expectation of high initial US crop ratings put pressure on the market. The forecast for June turned slightly wetter but will not have any material impact on planting finishing up. The Black Sea yields continue to be pressured due to their weather with no immediate relief apparent. The USDA Crop Production report on June 12 will be watched closely as we get updates for the US including acreage, area harvested, and yield. The market will be looking for any good news before then to help support a weakening market.

Beans fell on the week as planting advances despite some slowdowns in some areas due to weather. Currently only 3% of soybean production comes from areas experiencing drought. Rio Grande do Sul is turning warmer and drier after weeks of issues with flooding. Morgan Stanley estimates 5 million tonnes of soybeans were lost to the flooding in the region. Beans, like corn, have no bullish weather to help the market as it looks like normal planting progress should be made and no major weather issues in the forecast.

Equity Markets

The equity markets have had a rough go lately with all major indexes falling well off recent highs. Several earnings misses and growing belief that “higher for longer” could last through the summer has people raising questions about the market.

Other News

The Black Sea weather forecast has improved for next week as rain has been added to the forecast.
Wheat has seen a strong rally since mid-April seeing a $1.50+ rally at one point with possible production issues in the Black Sea even with the small pullback to end the week.

Drought Monitor

Via Barchart.com

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or [email protected].

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Disclaimers
RCM Ag Services is a registered DBA of Reliance Capital Markets II LLC. Trading futures, options on futures, and retail off-exchange foreign currency transactions are complex and involve substantial risk of loss and are not suitable for all investors. Loss-limiting strategies such as stop loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of options and/or futures positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. There are no guarantees of profit. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. You may lose all or more than your initial investment. You should not rely on any of the information herein as a substitute for the exercise of your own skill and judgment in making such a decision on the appropriateness of such investments. Opinions, market data and recommendations are subject to change without notice. Reliance Capital Markets II LLC shall not be held responsible for any actions taken based on this website or attached links. Parties acting on this electronic communication are responsible for their own actions. Past performance is not necessarily indicative of future results.

Disclaimer

RCM Ag Services is a registered DBA of Reliance Capital Markets II LLC. Trading futures, options on futures, and retail off-exchange foreign currency transactions are complex and involve substantial risk of loss and are not suitable for all investors. Loss-limiting strategies such as stop loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of options and/or futures positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. There are no guarantees of profit. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. You may lose all or more than your initial investment. You should not rely on any of the information herein as a substitute for the exercise of your own skill and judgment in making such a decision on the appropriateness of such investments. Opinions, market data and recommendations are subject to change without notice. Reliance Capital Markets II LLC shall not be held responsible for any actions taken based on this website or attached links. Parties acting on this electronic communication are responsible for their own actions. Past performance is not necessarily indicative of future results.