Soymeal Rumors

latest Soy meal Rumors:

  • While short on specifics, the chatter from the cash trenches continues to be a major commercial with assets in Europe being caught short physical soy meal thanks to delays in harvest and quality from Argentina.”
  • Option Firm named Optiver    blown out in Soymeal trades
  • Soy meal processing plant still down due to part malfunction
  • Argentina soy crop closer to 52 million and not the 56 million they are reporting.

Some truth in there along with just rumors to make an excuse for price action.Soy meal Calendar spread N/Z another new contract highs.Outright july meal another contract and 19 month highs.Soy crush spread also another multi month high overnight.But outright Soy  relatively tame compared to meal,July beans have made a new contract high but after a sideways trade and Soy Calendar n/x has yet to trade above last weeks highs. new crop trade much less affected.

DTN grains

Wire: DTN (DTN) Date: May 26 2016 8:15:04
DTN Before The Bell Grains 05/26 08:09

DTN Before The Bell Grains 05/26 08:09

Meal Keeps Pushing Higher

July corn was up 3 1/2 cents, July soybeans were up 8 cents, and July
Chicago wheat was up 6 3/4 cents.

By Todd Hultman
DTN Analyst

Morning CME Globex Update:

July corn was up 3 1/2 cents, July soybeans were up 8 cents, and July
Chicago wheat was up 6 3/4 cents. At 8 a.m. CDT, USDA announced that 123,000
metric tons (4.8 mb) of U.S. corn were sold to unknown destinations and 65,000
metric tons (2.6 mb) were sold to Taiwan for 2015-16. Taiwan also bought
another 65,000 tons of U.S. corn for 2016-17. Before the announcements, all
three grains were higher, led once again by commercial buying in soybean meal.

Other Markets:

Dow Jones: Higher
U.S. Dollar Index: Lower
Gold: Higher
Crude Oil: Higher

Corn:

At 8 a.m. CDT, USDA announced that 123,000 metric tons (4.8 mb) of U.S. corn
were sold to unknown destinations and 65,000 metric tons (2.6 mb) were sold to
Taiwan for 2015-16. Taiwan also bought another 65,000 tons of U.S. corn for
2016-17. Before the announcements, July corn was already a few cents higher
with light commercial buying as prices continue to benefit from gains in
soybean meal and dry weather in Brazil. Early Thursday, USDA said that last
week’s export sales and shipments of corn totaled 54.4 and 44.3 million
bushels, neutral-to-bullish amounts for the week that still give corn a chance
to reach USDA’s export estimate of 1.725 billion bushels. Fundamentally, a 14
billion bushel crop is a possible bearish threat this year, but so far demand
for corn is doing well and July corn has a good chance to break out of its
narrow six-month range by the end of this week — a bullish technical event, if
it happened. DTN’s National Corn Index closed at $3.70 Wednesday, priced 35
cents below the July contract and at its highest price in ten months. In
outside markets, July crude oil is trading above $50 for the first time in over
six months.

Soybeans:

July soybeans were higher early Thursday, propelled by commercial buying in
soybean meal once again. At 7:30 a.m. CDT, USDA said that last week’s export
sales and shipments of soybeans totaled 16.8 and 4.4 million bushels
respectively, a neutral weekly amount that keeps total shipments in 2015-16 a
little below USDA’s estimated pace. So far, the train of commercial buying in
soybean meal keeps chugging along, but it does seem crazy and a bit worrisome
that the July contract is trading over $20 above the August. Fundamentally, a 4
billion bushel soybean crop is still possible in the U.S., but prices are
showing no regard for any bearish concerns now. July soybeans remain in an
uptrend with USDA’s Acreage report due out on June 30. DTN’s National Soybean
Index closed at $10.16 Wednesday, priced 69 cents below the July contract and
at its highest price in over a year.

Wheat:

July Chicago wheat was higher early with help from light commercial buying
and this month’s higher corn prices. Early Thursday, USDA said that last week’s
export sales posted a net cancellation of 400,000 bushels while shipments
totaled 10.5 million bushels — another bearish performance for 2015-16.
New-crop sales were modest at 13.0 million bushels, but it will take time to
see if USDA’s higher export estimate for 2016-17 is reasonable. As bearish as
the analysis is for wheat prices, it is impressive that they continue to hold
firmly sideways, thanks to loyal commercial support. Right now, the HRW wheat
crop looks very good in the southwestern Plains, but there is some concern that
this rainy, sometimes stormy pattern will hurt crops in the next few weeks as
harvest get underway. DTN’s National SRW index closed at $4.22 Wednesday,
priced 44 cents below the July contract and staying within its narrow, sideways
range.

Todd Hultman can be reached at todd.hultman@dtn.com

Follow Todd on Twitter @ToddHultman1

(KA)

Copyright 2016 DTN/The Progressive Farmer. All rights reserved. -0-
May/26/2016 13:15 GMT

—————————–====================——————————
Copyright (c) 2016

################################ END OF STORY 1 ##############################

Dollar

DOLLAR

Dollar has been on a nice run as Rate hikes and  Solid Economic Numbers have been priced in.The dollar looks toppy as prices could not maintain action above the most recent highs.As a consequence prices are now at a new weekly low and trading below the old breakout area of 95.123.pending home sales at 9:00 is the last economic number of the day and Unlikely to be a market mover.Thus I believe technical will rule the day and should portend more down side for Dollar

Stocks

2134 ish all time high SPX, Currently trading 2095. What  sectors are driving the benchmark possibly above 2100?

etfff

A snapshot of Sector ETF’s with  the YTD change in far right column.A quick glance shows Oil and Gas,Energy,Industrial, and materials your leaders.Drilling and Exploration related stocks the  standout with gains 17% , and Energy Stocks up a Solid 11%. We also see gains in the materials  and Industrial sector as well. These Sectors  would do well with reflate trade or a A better economic outlook trade. Financials are unchanged as  measured by the XLF  but have been trending higher as  higher rate talk gooses prices.Utilities are also experiencing a nice YTD run,but with a tighter fed these gains may evaporate.

This makes for a nice story but lets look a the Momentum stocks. Apple higher 7-9 days  Amazon higher 7-8 days. An Index of momentum stocks +4%  yesterday .If the momentum stocks can do what they do and Financials continue to trend higher  ,2100 here we come.

The price of oil really does have a bigger impact on markets then many believe.I will post some graphs that show once the oil price bottomed,CDS on energy companies came off highs and SPX rallied.All withing a day or 2.

Grains

oilseeds

A snapshot of today’s action.Soybean meal(july) up 4%  today and almost touched limit up. Besides the ongoing reasons of Argentine supply A  more immediate  issue popped up.A Soybean processing plant in Indiana had an Unexpected shutdown ,This shutdown expected to last 2 days.So if an entity was  having a hard time trying to acquire meal before it just got a touch harder for the next day or so.Corn with a bid as the strength in Soy  may cause less corn and more soy to be planted.

Sugar  up 50 cents today and approaching last weeks high and multi- month high 17.29

 

Don’t Fear the Fed

The early Morning mantra of “don’t Fear the Fed” from Bloomberg running into Weak oil this morning. Eia Storage numbers leaning Bearish have taken some of the wind out of the sails of Spoos. The drop In oil has also had the expected impact on the long end as prices start to move higher.There is a 5 year auction today at noon and expectations are that  it will follow the results of yesterdays exceptionally strong 2 year.This too possibly  lifting whole curve.

The dont fear the fed trade of higher spoos in the face of Higher  rates has been used to describe the new theme to markets. Yesterdays response due to higher  New home sales is a prime example. Higher dollar,Higher spoos ,better growth due to improving Economy Fed is just one part.No need to fear this  all is good and the  rate Hikes will not derail  the Economy.Also the usual talk of gamma adjustment as SPX nears 2100,the higher the price more buying to occur.

Holiday week may also be impacting the trade via less participation and thus lower volumes.lets see how this” Dont fear the fed trade” does in the next couple days before we all jump  on Board.

EIA

Crude oil draw in line with API  report,Gasoline in line as well.Another drop in oil production has come to be expected.A surprise was the drop in demand for both gasoline and Diesel/heating oil.Where is the upswing that everyone is expecting?4 week demand metric  are okay.The weekly numbers are bearish more than bullish.The draw down in Crude stocks can  be explained by less imports .Imports from Canada were actually higher this week.The draw in crude stocks was not used to meet any immediate demand.