|
Price |
Change |
|
| U.S. Dollar |
82.45 |
-0.51 |
| Crude Oil |
93.84 |
+1.54 |
| Dow |
14,514 |
+117 |
Corn, cotton and wheat prices are up while soybean prices are down for the week. U.S. stocks fell Friday ending the longest winning streak for the Dow in nearly 17 years. Prior to today, the Dow had closed up 10 straight days. Watch for the market to become sensitive to planting weather as planters start to roll. March 28 will be an important date to watch as the Prospective Planting and Grain Stocks reports are released. It generally has been a market mover. One private survey released today looks for corn acreage down from last year, soybean acres up, and wheat acreage up relative to 2012.
Corn:
Nearby:
| Corn |
Price |
Change |
| May |
$7.17 |
+$0.13 ½ |
| Support |
$7.09 |
+$0.31 |
| Resistance |
$7.24 |
+$0.24 |
| Technical |
Buy |
++ |
| 20 Day MA |
$7.00 |
+$0.05 |
| 50 Day MA |
$7.09 |
+$0.01 |
| 100 Day MA |
$7.21 |
-$0.02 |
Weekly exports were well above expectations with net sales of 25.7 million bushels (net sales of 11.1 million bushels for the 2012/13 marketing year and 14.6 million bushels of net sales for the 2013/14 year). Ethanol production dropped 8,000 barrels per day to 797,000 barrels per day in the latest report.
New crop:
| Corn |
Price |
Change |
| September |
$5.86 ¾ |
+$0.15 ½ |
| Support |
$5.74 |
+$0.18 |
| Resistance |
$5.90 |
+$0.17 |
| Technical |
Sell |
+ |
| 20 Day MA |
$5.78 |
= |
| 50 Day MA |
$5.94 |
-$0.03 |
| 100 Day MA |
$6.20 |
-$0.04 |
At least one private acreage survey estimates corn acres to drop 199,000 acres from last year to 96.956 million acres. Currently, I would have 10% of 2013 production priced. If prices move to the $6 range, that may present a good opportunity for pricing
Cotton:
Nearby:
| Cotton |
Price(cents) |
Change |
| May |
92.50 |
+5.62 |
| Support |
87.25 |
+2.68 |
| Resistance |
92.97 |
+3.04 |
| Technical |
Strong Buy |
= |
| 20 Day MA |
85.83 |
+1.53 |
| 50 Day MA |
82.39 |
+1.29 |
| 100 Day MA |
78.34 |
+0.67 |
| AWP |
72.19 |
+0.96 |
All cotton weekly export net sales were 282,800 bales (187,600 bales of Upland cotton net sales for 2012/13; net sales of 40,500 bales of Upland cotton for 2013/14; net sales of 44,900 bales (marketing year high) of Pima cotton for 2012/13; and 9,800 bales of net sales of Pima cotton for 2013/14). May traded as high as 93.93 cents today. Nearby cotton futures responded favorably to Chinese policy that nearly doubled its previous low tariff import quotas for its domestic mills, adding 3.67 million bales to its previous cap. This means that mills have been authorized to import this additional cotton. Chinese mills have been reluctant to purchase stocks from China’s huge reserve due to price and quality. This could come from U.S. exports, further reducing U.S. ending stocks.
New crop:
| Cotton |
Price(cents) |
Change |
| December |
88.51 |
+2.12 |
| Support |
87.58 |
+3.11 |
| Resistance |
89.66 |
+2.05 |
| Technical |
Strong Buy |
= |
| 20 Day MA |
85.35 |
+1.11 |
| 50 Day MA |
82.48 |
+0.89 |
| 100 Day MA |
79.81 |
+0.48 |
Cotton prices continue to move up with old crop prices, although not near as much. Some producers may look to reconsider cotton acres with futures approaching 90 cents. Most likely, prices have bought additional acres since the January National Cotton Council producers’ survey of 9 million acres. However, it is still likely that acreage will be reduced from 2012. The trend is still up, but producers should watch prices closely. Implementing a floor price strategy would entail buying an 89 cent put option costing 6.55 cents and setting an 82.45 cent futures floor. Cotton equities on 2013 loan cotton look to end the week in the 29-30 cent range.
Soybeans:
Nearby:
| Soybeans |
Price |
Change |
| May |
$14.26 |
-$0.45 |
| Support |
$14.08 |
-$0.26 |
| Resistance |
$14.54 |
-$0.49 |
| Technical |
Sell |
— |
| 20 Day MA |
$14.53 |
+$0.09 |
| 50 Day MA |
$14.34 |
+$0.05 |
| 100 Day MA |
$14.32 |
= |
Weekly exports were within expectations with net sales of 28.8 million bushels (net sales of 24.2 million bushels for 2012/13 and net sales of 4.6 million bushels for 2013/14). February soybean crush of 136.3 million bushels as reported by the National Oilseed Processors Association was less than the 141.6 million bushels that the trade expected. A report of lengthy delays getting soybeans shipped out of Brazilian ports continues to support nearby prices.
New crop:
| Soybeans |
Price |
Change |
| November |
$12.61 |
-$0.07 ½ |
| Support |
$12.49 |
+$0.02 |
| Resistance |
$12.71 |
-$0.22 |
| Technical |
Strong Sell |
= |
| 20 Day MA |
$12.68 |
-$0.02 |
| 50 Day MA |
$12.87 |
-$0.04 |
| 100 Day MA |
$13.00 |
-$0.03 |
A private acreage estimate of 78.3 million acres for 2013 if realized would be 1.12 million acres more than last year. I would have up to 10% priced on 2013 production. I think there may be an opportunity for additional pricing at higher levels or an opportunity to put in place an option strategy. If the market can get back to $13, I would closely at prices in that range.
Wheat:
Nearby:
| Wheat |
Price |
Change |
| May |
$7.23 |
+$0.26 |
| Support |
$7.14 |
+$0.34 |
| Resistance |
$7.29 |
+$0.18 |
| Technical |
Sell |
+ |
| 20 Day MA |
$7.14 |
-$0.09 |
| 50 Day MA |
$7.48 |
-$0.07 |
| 100 Day MA |
$8.04 |
-$0.08 |
Weekly exports were well above expectations at net sales of 39.9 million bushels (32.6 million bushels for 2012/13 and net sales of 7.3 million bushels for 2013/14). Anticipation this week that strong feed usage of wheat will increase demand has sparked prices. Demand from feedlots increased when one railway cut its fees for shipping soft red winter wheat from the Midwest to the Plains.
New Crop:
| Wheat |
Price |
Change |
| July |
$7.21 ¼ |
+$0.22 ½ |
| Support |
$7.09 |
+$0.26 |
| Resistance |
$7.28 |
+$0.15 |
| Technical |
Sell |
+ |
| 20 Day MA |
$7.16 |
-$0.10 |
| 50 Day MA |
$7.52 |
-$0.08 |
|
100 Day MA |
$8.02 |
-$0.06 |
A private survey pegged all wheat acres at 56.3 million acres, up 525,000 acres from 2012. Markets will closely be watching wheat conditions in the Plains as we enter spring. I am currently priced 10% on the 2013 crop.
