Opening comments ahead of USDA Report 6-12-2013
Well it’s hurry up and wait time. Markets are called mixed this a.m. but it’s
all about the USDA report that will be out in a few hours at 11 a.m. central
time. The prices before then won’t
matter much as the USDA report should give us a little updated fundamental information.
In the overnight session corn was down 2-4 cents, KC wheat
was 2-4 lower, MPLS wheat was unchanged, CBOT wheat was off 4-6 cents, July
soybeans were up 3 cents a bushel, and November soybeans were down 3 cents a
bushel. Outside markets are fairly
stable today with the US dollar about unchanged with the cash index at 81.189,
crude is up about 80 cents a barrel, gold is down 3 bucks an ounce, and equity
futures point towards a positive 70-90 point start in the DOW.
Like I mention above its not were our markets start before
the USDA report but how then end up after the USDA report that’s important.
Before the report comes out we will have ethanol numbers;
but otherwise it is just about the USDA report and the weather. Too much rain in areas like North Dakota,
Iowa, and parts of MN remains very bullish due to the loss of acres, prevent
plant acres, agronomic issues, and replanting acres. While rain in the eastern corn belt is
probably seen as bearish prices as most of the crop is in and they are not
really behind schedule from a historic basis.
The 6-10 day forecasts have above normal temps for our area and above
normal to normal precipitation for our area.
Many areas need some heat.
Continue to watch for plenty of debate on weather.
For wheat we continue to lack issues elsewhere in the world;
plenty of issues with the HRW crop and possible issues with the spring wheat
crop. But we still are not getting the
business we really need.
As for the report we could easily just trade it for a few
minutes or it could change our trend for a month or more. Most likely the market will take a wait and
see confirmation until we get more weather information and the updated acre and
stocks report on June 28th.
It just seems like we have way to many unknowns to take all of the premium
we have in our market out and at the same time should the USDA come in below
the grain markets expectations the market might take a wait and see approach or
confirmation that demand will stay strong.
Bottom line is that today is all about the USDA but it
remains to be seen if tomorrow or a week from now we will still be talking
about the USDA report from today or if the market will be looking at other
information such as weather and what it will do to supply.
Not much else to say today; just make sure you are
comfortable going into the report later this a.m.
Still time to make some sales or get some protection in
place if you are not. Just remember the
fine line from making fear decisions and good business decisions; no operation
is the same and thus no % sold level is right for everyone.
Don’t forget we will have our weekly meeting in Onida this
afternoon at 3:00; we will be going over the USDA numbers at that time.
Thanks