Kleist Comments

MORNING GRAINS 11/6/13
MORNING GRAINS 11/6/13

Corn:

Exports: So. Korea passes on 70,000t; Japan buys 115,000 feed barley.

Comments: So.Korea’s largest feed importer behind the cancellation alluded to above……says they see global prices falling further…getting a bit cocky, eh?; one analyst actual said grains will be bullish due to the Oat futures action (well, Dec.’s been in an uptrend since mid-Sept. so maybe eventually it will make out but still ‘reaching’ for a bull-corn trade?); the report might be simply how well demand has kept up with the expected increase in production, then of course will production reach upper end of some estimates to justify much lower prices? (I never ‘bet’ a report but if one is doing so use calls or a call spread conservatively); open interest fell 6,100 led by Dec. off 22,700 (some big rolling there), volume moderate/strong. Wire survey has yields at 159/bu.acre. No opinion change.

SOYBEANS:

Exports: None Visible.

Comments: Deliveries 271, mostly street though ‘house’ accounts puts out 50 and stops 82; Malaysian palm oil prices have cooled off its run up; South American weather remains favorable; open interest fell 3,200 spread across X/F/H totaling 6600, volume light-side; report Friday will likely center on the demand side’s ability to mop up expected large increase in production…..demand has been such that production better be close to high-end estimates. No opinion change.

Wheat:

Exports: Egypt in 60,000t; Jordan in 100,000t.

Comments: Curious how some news reports headlined overnight action with ‘wheat higher on strong demand’ that is used every time lately when prices pop at all while the BIG trend in prices has been consistently new lows; prices firmer on a technical bounce is more like it;

USDA report though should show a rise in demand but likely global production will overwhelm it; U.S. winter wheat conditions still favorable; open interest rose 7,300 indicates funds still active bears and trading with the trend down, volume was good; the U.S. is no longer the ‘big dog’ in leading world prices i.e. when overseas markets rise in prices THEN the U.S. can….for now anyway. No opinion change.

Kleist Comments

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

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