Kleist Comments

MORNING GRAINS 7/17/13
MORNING GRAINS 7/17/13

Corn:

Exports: None visible.

Comments: Part of the reason corn is reluctant to rally too far and can fall rather easily seems this: weather is not EXTREMELY detrimental and where it is a problem crop losses are random and not wide spread. My take anyway. But nonetheless weather still an underlying supportive feature. I have reported on many bull puffs of smoke on past bull markets but for a change of pace, can you imagine a major commission house analyst putting this out?….Univ. of Mo. Agronomist says corn prices could be around $5.00/bu. vs. $7.00 year ago but sees an average price of $4.75 most of the “next decade” and IF another big crop comes in, could be $3.00. I, of course, like that type of blasphemy; near term I projected Dec. holding $5.00-4.75 but if corn goes OK and beans end up OK we’ll be closer to $4.50-4.25. Open interest fell 1,155 led by U/Z off 4,000 amid light-side volume.

SOYBEANS:

Exports: Sold China 165,00t new crop.

Comments: Big cash movement squashed basis yesterday; weather “uncomfortable”, some stress humans and perhaps plants but August the more important month; China futures higher on CBOT rally; China’s economic growth could cool appreciably says the IMF (down to 4%); open interest rose 3,159 even as August drops 2573 (curiously, F/H rises 4,000 combined, Nov. very little….would more indicate a South American play than a weather market one here) amid light-side volume. Yesterday mentioned buying November puts up here as safer substitute for short futures for now in a weather market and its attendant volatility and another old crop squeeze in the works.

Wheat:

Exports: So.Korea buys 40,000t Aust., 60,000t Black Sea and 42,000t U.S.

Comments: Asia continues on its booking spree at these ‘lower’ prices (food and vs. U.S. corn price feed), sees Australian supplies lowering until mid-November, and the U.S. crop damage. Open interest fell 1900 led by Sept. off 1635 amid light volume. No opinion change.

Kleist Comments

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

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