Tag: soybeans
December 2022 Opus Futures Ag Commentary
Commentary provided by David Zelinski of Opus Futures. Happy New Year to all! I’m excited to get off to a great start in 2023, but before discussing the outlook, I want to spend a quick minute discussing 2022. Our program was off to a strong start in the first half of 2022, but profits were harder […]
Incredible Velocity Movement Between KC Wheat and Chicago Corn
Commentary provided by Chad Burlet of Third Street AG Investments As always, the month of March and the first quarter ended with the USDA’s release of their March 1 stocks report and their spring planting intentions report. These reports often have the potential to dramatically disrupt conventional wisdom and today’s report did not disappoint. For the past […]
February 2021 Grain Market Commentary
Commentary provided by Chad Burlet of Third Street AG Investments With only one trading day left in February, it’s clear that the spring acreage fight has captured the market’s attention. While old crop corn and soybeans struggled near highs that were set weeks ago, November soybeans and December corn raced to new contract highs yesterday. Through […]
Third Street AG July Commentary
Data and information is provided for informational purposes only, and is not intended for trading purposes. Neither IASG or Third Street Ag Investments LLC nor any of their data or information providers shall be liable for any errors or delays in the data or information, or for any actions taken in reliance thereon. We do […]
Kottke Commodities – U.S. Crops, World Demand Both Probable Records
July is the make-or-break month for U.S. corn, as well as immediately ahead of the counterpart period for soybeans. After burgeoning world demand stripped the big South American soybean crop bare in only five months, and Brazil’s corn production shrank, the consequences of a merely modest problem in the U.S. harvest would have been extremely serious. Widespread publicity of “La Nina,” an unusual eastward shift of warm water in the Pacific Ocean associated with poor growing conditions inNorth America, had the world food market particularly on edge. Prices of both corn and soybeans rose sharply in June in apprehension of widely-forecast hot and dry weather during the crucial months to come.
Kottke Commodities – Soybean-Corn Supply Imbalance to Continue
The world grain trade has been shocked in 2016 by the speed with which the entire exportable surplus from a large Brazilian soybean crop was consumed. While statisticians’ opinions differ, the more astute extrapolated early on from the pace of vessel loading that importers would not only come with equal alacrity for the U.S. crop next fall, they’d even need to tap more U.S. supplies yet this crop year. In short, demand for soy meal, a high-quality, high-protein feed ingredient key in efficient meat production, is beyond anything anticipated.
Kottke Commodities – A Half-Empty or Half-Full Glass?
We know of very few commercial entities or traders that were positioned last month to reflect much possibility that soybean prices at CME might be far too low. Plenty of different explanations have been offered as to the source of last month’s abrupt price explosion of grains and oilseeds prices. These can be roughly divided into two groups, “game theorists” and “statistical analysts.”
Investing in a Continuum of Change: Trading Futures Markets Amidst Rapid Transformations
Market Commentary from Kottke Commodities – Commodity Capital CTA – Kenneth Stein Most of our expectations are just knee-jerk reactions to day-to-day details, but today’s headlines rarely reflect tomorrow’s reality meaningfully. For example, how many tectonic changes in different areas of our lives have and continue to occur, only dimly perceived even by those attentive to […]
A look back at the Grain Markets
Wheat made new lows led by Matif, and corn and beans worked towards low end of the ranges. There were no real weather scares in SAm and both corn and bean prod’n ideas are getting bigger. For the month, corn lost 19-20 cents and beans were down 27. Meal was down $11.00 and oil down 25 points. Chgo was the biggest loser – down 35 cents with KC down 27 and Mpls down 16. Matif wheat was down $14.75 euros/tonne – 44 cents. French wheat is $20-25/ton below SRW and thus continues to bring Chgo down.
Narrow Ranges Reflect Ample World Supply
The amplitude of grains and oilseed prices last month was extraordinarily narrow. Soybeans were the most-contained, with a high-to-low closing price range of just 28c in the March contract, narrowest for January since 1998. It’s even more remarkable considering that on the 12th, USDA surprised the trade by reducing the 2015-16 U.S. crop by 50 million bushels. The reason that such stable matching of supply and demand rarely persists for a month is the constant fresh assessments of risks to production of crops in the field and the next to be planted. Today, such is the adequacy of supply and geographic diversification of growing areas that the market judges risk to be lowest in decades.
Kottke Associates – As Grain Prices Fall, Shipping Costs Alter Outlook
Grain and oilseeds prices continue an abrupt transition from high-priced relative famine of the last five years to a low-price feast of plentiful supply. Farmers who did not prudently hedge before the big decline would say “overly plentiful,” but government subsidies will restore much of that. Recent years of demand growth undeterred by high prices had encouraged every farmer to plant and fertilize more, followed by Northern Hemisphere weather rivaling perfect greenhouse conditions. The result is the spectacular yields that high-tech seed companies advertised.
Kottke Associates – It’s The Weather, Stupid
August trading results improved markedly as one of the metrics with which we track ourselves, the ratio of winning trades to losers, rose dramatically. Summer crop development was uncharacteristically dull, with unchanging, uncannily positive growing conditions. Since we refrain from exposing investor capital to weather forecasts anyway, we trained our attention on the wheat crops already harvested and the old-crop soybean market still working out its supply tightness.
Wheat Class Substitution Fuels Arbitrage
The sweeping nature of this summer’s price declines in grains and oilseeds has at every moment been dependent on unusual season-long consistency of rainfall and below-average temperatures. Owing to many years of observing sudden weather changes generate wrenching turnarounds in direction of futures, the managers felt that committing to price direction was tantamount to forecasting weather. Monthly returns remained flat, but the two successful trades were strategies formulated to end-run weather risk.