Kleist Comments

MORNING GRAINS 1/3/14
MORNING GRAINS 1/3/14

Corn:

Exports: None Visible.

Comments: Weekly export sales fell 90% to 154,500t with cancellations by Unknown of 209,400t and China 116,000t; shipments fell 37% to 844.400t, still good. The holiday’s have an effect on exports? We’ll see. I suspect the cancellations were anticipated? But, more coming? U.S. Grain Council says no fast resolution to the China GMO issue. Very Mini-battle yesterday: open interest rose 6,200 and after making new swing highs fell back to lows (volume moderate). A close over yesterday’s high of $4.27-1/2 might prompt better gains but for now………

SOYBEANS:

Exports: None Visible.

Comments: Weekly export sales 943,400t rose on the week with China taking 371,100t and in the number two spot an unlikely contender: Vietnam buys 219,300t. However, Unknown canceled 238,800t. Shipments rose 6% to 1.528mln….not bad. Deliveries 0, meal 1 and oil 180; Brazil posts smallest trade deficit since 2000, near even, on weak global demand and eroding exports; northern Brazil harvesting gaining ground; open interest fell 4,300 led by F/H/X amid moderate volume. As we leave the January contract yesterday, the March contract has considerable chart damage. Few days ago I mentioned it fell out of its uptrend channel as a warning flag. The time frame of March coincides with active South American harvest. Funds exiting longs like lemmings off a cliff? Not quite certain yet but looks suspiciously so. In my readings, many fund mangers are not that keen on commodities in general for 2014. Nonetheless, for now the tilt is bearish (and I got my ‘mini-distribution top’ confirmation, some times old school does work still); March needs to get and hold over $12.92-3/4 to $13.00 to turn back to a more neutral stance (of note $12.94-1/2 the 100-day m/a with currently $12.74-1/2 the 200-day). South America looks OK generally. Market well oversold best we can say right now.

Wheat:

Exports: None Visible.

Comments: Weekly export sales fell 58% to 248,500t and ‘only’ 36,000t was cancelled; shipments fell 40%…not prepared to blame it on holiday aberration just yet. Open interest rose 5,700 again amid light volume and new contract low close. Downside arbitrary, charts suggests $5.75-5.80 near term; need to close over resistance at $6.12-6.20 to ‘right’ the decline.

Kleist Comments

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

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