Kleist Comments

MORNING GRAINS 7/19/13
MORNING GRAINS 7/19/13

Corn:

Exports: So.Korea buys 165,000t So.African/Black Sea corn.

Comments: Another reminder that if U.S. not the last resort, feed competition has changed forever (alluded to above). Open interest rose 6,900 led by U/Z/H amid moderate volume. Some talk southern China could pencil in more U.S. corn with Dec. sub-$5.00. As mentioned, Dec.’ glass half full holding swing lows but also half empty by testing it again. Many were fooled by the spastic arguments over old crop supplies just recently i.e. hey, cannot sell new corn with spot month strength. In the end it was a smoke screen if no drought occurred. It’s a “weather market weekend ™” and come Sunday night the market might just determine if new lows are warranted or bears to quick on the draw to out a drought to rest.

SOYBEANS:

Exports: None Visible.

Comments: China futures lower on improving U.S. weather; open interest fell 5,400 led by Q.X off 6600 amid light volume. Doesn’t look like November beans area in any danger of revisiting my near term objective at $12.20-12.00. Typical though: hey, August’s key bean weather still two weeks away, let corn deal with it (good July weather). November though seems coiling between/around several m/a’s (10/20/45/50/100/200 day) from $12.82-12.55. Even if November breaks out at +$12.97 I am not sure there’s enough of weather problem, or fund stomachs, to go much higher than that; close under $12.50 might tip it to my support area. Will old crop beans also end up being a smoke screen?

Wheat:

Exports: Sold China 120,000t SRW; China buys 600,000t Aust. for Jan,/Mch.

Comments: In a different time and place the amount of Asian buying led heavy China buying would mean more to this market. Many times one wave lifts all ships and large world export demand activity, even if not all U.S., generally benefits wheat in general. For now, buying calls (as mentioned ‘just in case’) no big deal yet since maintained hedged position. For now then, back to an old analysis: spot wheat cannot hold over $7.00. But we need to get there first to test it again.

Kleist Comments

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

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