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The trade is bullish corn

Agriculture.com Staff 02/13/2016 @ 1:20pm

Historical Price Trends: best odds for the week of April 7 is for CBOT May Soybean Meal. Over the most recent ten years, odds of 80% for higher CBOT wheat futures than where they closed on Friday of the present week.

For The Week: for the week, May corn futures value increased 6.7%, May soybean futures value increased .07% and July CBOT SRWW value decreased by .05%.

Technicals: For the short term trader, Allendale uses its own unique custom Moving Averages to monitor price momentum, define key support and resistance levels as well as advise where key pivot points are located when bulls may turn bearish and bears to turn bulls. We also include last weeks closing price for the weekly chartist as we draw closer to the end of the week to anticipate the possibility for futures to have a positive weekly close or if weakness is ensuing.

Observation: May and July Soybeans as well as July wheat at the KCBT and CBOT precariously close to breeching the #2 Moving Average. If Neutral, consider stopping into a short position with an objective of the #1 Moving Average.

Projected Ending Stocks: for the 2007/08 marketing year, are found within our Midsession comments. Stocks of corn, soybeans and wheat are constricting. For soybeans the combination of stronger than average exports and pace of soybean crush are the main reasons for the smaller estimate than the previous month. The export pace for corn and wheat is also stronger than average as a result of a weak US dollar and lack of world supply competition.

Corn Fundamentals: the trade is bullish to corn on ideas of planting delays of potentially smaller 2008 corn acres. See planting progress data below. Commercials strong buyers of futures on Wed and Thurs. This could be interpreted as foreign demand for US corn. Weather experts at a conference on Thursday suggest La Nina is weakening and may be suggest a mild summer for the greater Midwest. Plenty of wet weather forecasted for much of next week may be viewed as supportive to futures. If the 3 to 5 day forecast should happen to turn warm and dry for the Midwest, look for a portion of weather premium to be removed from the futures market. Look for corn exports to begin from Brazil. Argentina's corn harvest is making better than average progress with healthy yields.

Old Crop Marketing: 5650 cash corn requires 4.3 cents per bu per month to store on farm. The present spread between May and July futures is offering 6.3 cents per bu per month. Make certain unhedged corn meets the criteria. Allendale has its old crop corn hedged in the May futures.

Cash Peak: Dating back to 2000, odds favor a national cash corn peak for the months of April and May.

Exports: corn exports account for 19% of the total 2007/08 use. with 22 weeks remaining in the marketing year, cumulative sales of 2.107 billion bushels to all nations are 26% higher than year earlier levels and 38% higher than the five year average. Based on the past 4 weeks ave weekly sales the US is on pace to sell 2.512 bil bu vs USDA target of 2.45 bil bu. Shipments of 1.482 billion bushels are 15% higher than year earlier levels and 60% below the five year average.

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