Kleist Comments

MORNING GRAINS 10/23/13
MORNING GRAINS 10/23/13

Corn:

Exports: Vietnam buys 400,000t Brazil; Taiwan buys 60,000t Brazil; So.Korea buys 55,000t opt/org. corn; Japan buys 49,830t feed wheat, in for another 180,000t feed wheat and 200,000t feed barley; So.Korea cancels tender for 140,000t corn and 60,000t feed wheat.

Comments: Pretty active global export activity and as I say, sometimes all that matters is that it is not necessarily all coming out of the U.S.; recent pricing as follows—-U.S.. $251/ton, So.Amer. $248.73/ton and Black Sea $245.58/ton. Open interest rose another 12,330 amid very fairly light volume……..open interest keeps coiling tighter and tighter usually indicates a breakout is boiling under the surface…..17-day range $4.50-4.32 basis December. No opinion change though admittedly I’d like to see an updated C-O-T report.

SOYBEANS:

Exports: Sold Russia (!~) 120,000t soybeans.

Comments: Hmmmm….Russia, eh? Since it was a USDA overnight release on quantity the delivery date was generalized for 2013-2014 and to me curious if it was in lieu of new crop South American (price competitive?); in other news Canada says Canola oil content coming in higher than average; some talk China might be looking to tighten monetary policy after recent economic data; open interest fell 2,600 led by November off 9,595 amid decent volume again; electronic and open outcry took out range high and if holds points to $13.20’s. No opinion change.

Wheat:
Exports: None Visible.

Comments: Wheat higher due to perceived crop problems in Black Sea, in Argentina, in Australia, in deserts, in general and…OK, OK it’s really higher because DEMAND for global wheat has been active overall and backgrounded by last week’s export sales number; I have been in a neutral/trading affair mode that has worked but as long as corn doesn’t crack open the better advice would been better perhaps just buying breaks for the ’tilt’. By the way, weather report had Australia ‘mostly favorable’ for mature wheat and for harvesting; open interest rose 2,850 led by March up 1775 amid fairly light volume. Of economic news: a poor employment report sparks Stock rally because it means the Fed will NOT be able to ‘taper’ its bond buying program?….and finally, major Brazilian Investment Bank might look to buy out JPMorgan’s commodity unit (valued at around $3.0bln.?) and I suspect a growing trend of Banks exiting commodities one way or another.

Kleist Comments

This is John Kleist, of Kleist Ag Consulting.
Questions? Email me: johnwkleist@sbcglobal.net

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