Market Analysis

winter sunrise

More about options

Arguably, the report last week was the third most important report of the year (after planting intentions in late March and the actual planting and stock report in late June). It showed the final yield results for 2016.   Corn There were few changes to the corn bottom line. Corn still shows a 2.3 billion [...]

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2015 snow corn2

Option strategies

Frequently farmers ask for my opinion on buying puts. While generally I’m not a big fan, purchasing puts can be a useful tool in a farmer’s toolbox. However, farmers must be careful to fully understand and consider both the advantages and disadvantages of using them. Regardless of my opinion on buying puts, I think it’s [...]

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2015 snow fence

Mixed results from big January report

The numbers from today are mixed for grains. Two surprises with soybeans today. First, soybean numbers were bullish with U.S. production at 4.307 billion bushels and the yield at 52.1 bushels per acre. Both were below trade expectations and below last month. That was the surprise. In addition, soybean ending stocks were pegged at 420 [...]

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Beans 2012

Really, $6 beans? Probably not.

Corn Corn pushed to the top of the trading range last week. However, with 2.3 billion corn bushels carryout (compared to 1.8 billion last year), farmers are anxious to sell, so prices pulled back by Friday. It will likely take a significant drop in corn acres next year and a weather event to see $4 [...]

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money dollars

Using the “dreaded” margin call

There may be potential dry weather issues in Brazil (two regions — Minas Gerais and Bahia). The market is adjusting to this bullish news, but keep in mind these two regions only account for about 8% of Brazil’s total bean production. It would be like if Ohio (7% of the U.S. bean production) was suffering [...]

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DSC_4269

Weather to dominate markets

Weather features will dominate U.S. grain markets for at least the next 60 days. Those weather features will be in both North America and South America. As the U.S. began the winter weather season last month, several items stood out. First, the Plains and the hard red winter wheat grown in that area went into [...]

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soybeans in fall

Protect soybean profits for 2017

It was another week of relatively boring, range-bound markets. With the holidays approaching it seems like the trend will continue. Since harvest I’ve been presenting Grain Marketing Workshops to farmers throughout the Midwest. During these meetings, I’ve had the chance to talk to many farmers about future plans. Many farmers have indicated they will plant [...]

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$3 corn2

Double call strategy sale

Brazil’s weather has been good recently, some are expecting a record crop.  If this happens, the U.S. export program may slow when the Brazil bean harvest starts in 45 days which could lead to a ceiling on prices. Several weeks ago I mentioned that Nov ’17 bean prices compared to Dec ’17 corn prices are [...]

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money2

Option spread protection trade

There was little news during the holiday week. Highlights: South American weather conditions remain good, but dry weather could still have an impact EPA increased renewable fuels, should cause increased demand for soybeans and corn Goldman Sachs issued their first commodity buy order in over four years, which may help grain prices long-term Corn remains [...]

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soybean sunrise

Market history shows there is no certainty in the future

As they say in the North, “winter is coming.” Last weekend I mowed the yard at 60 degrees. Today it is 32 degrees and snow is on the ground. Harvest is mostly done. At this point the market will have to rally to get farmers selling, because bins are closed and locked tight. Seasonally the [...]

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