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Schad Commodity Blog & Commentary
This commentary is intended to provide unique insights with my 30+ years experience for the commodity crypto & futures markets we use in our everyday lives and is recognized, and has been selected, by Feedspot as one of the the Top 20 Futures Trading Blogs on the web. Schad Commodity views & opinion only. For additional commentary, and to assure you’re receiving the Schad Commodity Daily Report, be sure to connect on Facebook® & Twitter®.
From the desk of Brian Schad:
Salt-Resistant Rice a Great Hope for Islanders; Rice Futures
Rice futures continue their climb from late March lows as an organization in the East Indies helps rice farmers inhabiting disappearing islands with a salt-resistant rice variety. Rice futures closed up .035c yesterday trading at $12.145 per cwt at the Chicago Board of Trade.
Farmers in a small disappearing island community called Ghoramara are being reintroduced to one of very few salt-resistant rice varieties that will help them retain their staple food as sea levels continue to rise around their homeland. When salt water would enter the farmers’ rice fields, it would destroy the entire crop and would take three to five years until a rice paddy could be planted again.
“Five years ago I gave seeds for five of the six salt-water resistant varieties of rice to the struggling farmers and instructed them to grow them for seeds. Don’t eat the rice. Save them,” said Asish Ghosh, founder of an environmental organization called ENDEV, The Society for Environment and Development in West Bengal, India, sharing his fundamental assessment of the rice futures market. Ghosh added, “Now ‘countless’ farmers in the Sundarbans are now planting salt-resistant rice.”
Rice futures trend remains “up” with no top yet in sight. Rice futures appears to be climbing to the $12.50 resistance area before a significant pullback could be expected.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
Corn Futures Extend Gains With 75% Crop Planted and Almost One-Half Emerged
Corn futures are strong coming back more than .30c from earlier month lows despite being ahead of planting schedule and nearly half of the national crop emerging. Corn futures are up .025c today currently trading at $3.995 per bushel at the Chicago Board of Trade.
The USDA reports 75% of the domestic corn crop planted which is 5% ahead of schedule for this time of year based on the current five-year average, and the states leading the planting of 18 states total are Minnesota (96% planted); Illinois & North Carolina ( both 92%); Tennessee (90%); and Iowa (89%). The states picking-up the lower average are Colorado (53%); Pennsylvania (64%); Indiana & North Dakota (both 68%); and Michigan & Ohio (both 71%).
“Corn plantings are coming along at a good pace – eleven percent better than just this time last week,” said Devin Brady, President of Progressive Trading Group in Sherman Oaks, CA, sharing his fundamental assessment of the corn futures market. Brady added, “Although not aware of current export numbers, with a thirty-cent rise from just last week we may be looking at a demand picture going into the summer months.”
The trend for corn futures has returned back “up” only yesterday. Corn futures do continue to trade within a range between $4.07 on the high-side and $3.51 on the low-side both established last month.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
With 40% Domestic Crop Planted, Cotton Futures Rally
Cotton futures are experiencing a technical rally as all 15 major producing states report a total of 40% of domestic cotton now planted. Cotton futures are up .015c today currently trading at .6249 cents per pound at the Intercontinental Exchange in New York.
Forty-percent planted is right on target for this time of year based on the previous five-year average, and the states leading the planting are Arizona (99% planted); California (82%); Arkansas & Louisiana (both 79%); and Missouri (71%). The states still behind the eight-ball are Kansas (6%); Texas (18%); Oklahoma (23%); North Carolina (36%); and Georgia (37%).
“The cotton planting is chugging along as farmers are reportedly asking the EPA to be more decisive with their requests for pesticides to help remove a major insect pest,” said Laura Taylor, a senior market strategist at RJO Futures in Chicago, sharing her fundamental assessment of the cotton futures market. Taylor added, “The farmers are trying to prevent losses estimated to be about $90 per acre without insect protection.”
Cotton futures trend has technically rolled over to “down” in my study just last week. This technical rally in cotton futures could possibly be sustained if the EPA stalls with an affirmative decision soon.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
Schad Commodity’s Weekend Report: An Insider’s View of the Next Big Market Move
Once each week, usually on Friday evenings, we update our personal weekly commodity trading charts and review them for changes in “net long” or, “net short” holdings between the big commercial commodity traders, large speculators, and the usually uninformed public. This is our professional analysis of “the bigger picture” and current dynamics for each market which provide a spyglass view of the BIG commercial traders and what they are currently doing to influence the futures markets.
As you may already know, insider trading with stocks on Wall Street is very illegal. However, in the commodity trading industry, large/commercial traders MUST report their positions EACH WEEK to the CFTC regulatory body, hence, we monitor them on a weekly basis. Although the futures markets themselves will ultimately provide the most accurate illustration of trend, these (weekly) charts we’ve identified, serve to forewarn us of the next possible bigger move.
Here are the commodity markets which illustrate the changing bigger picture for them:
UP Trending Futures Markets: Japanese Yen, Gold, Euro-currency, Soymeal, Crude Oil, Silver, CBT Wheat and Eurodollars, Lumber, Sugar, S&P 500 Index, Corn, 10yr. T-Notes, & Soybeans (These last seven new this week.)
DOWN Trending Futures Markets: N/A
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
Lumber Futures Extend Gains on Technical Rally, Hardwood Prices Lowest in a Decade
Lumber futures initially extended gains from its contract lows in early October despite both hardwood and softwood prices being at their lowest levels in 10 years. Lumber futures are currently up $17.30 today currently trading at $321.20 per 1,000 board feet at the Chicago Mercantile Exchange.
Hardwood fiber prices continued to fall in most of the major pulp-producing countries in the world as of last year’s fourth quarter with the biggest declines seen in Brazil, Chile, Russia, France, Germany and Indonesia. With the exception of the US South and New Zealand, softwood fiber prices were also down throughout the world at the end of last year with the decline ranging between 2% to 10% from the previous quarter.
“Lumber (futures) prices seem to have fallen in tandem with the high of the domestic housing market,” said Kevin Craney, Director of Managed Futures at RJO Futures in Chicago, sharing his fundamental assessment of the lumber futures market. Craney added, “Much of the US lumber and building materials were devoted to overseas rebuilding of war-torn areas in Iraq and Afghanistan, but these efforts have wound down a few years back.”
The daily trend for lumber futures is currently up on what appears to be a technical rally from the early October and late January lows. I would expect lumber futures to climb to the next resistance level of $360 initially, and then possibly $380, until we see a resumption of the overall lower weekly trend, or at least a test of its October lows.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
With a USDA Shrinking Forecast, Soybean Futures Soared
Soybean futures gained as much as .65c per bushel yesterday following the USDA’s forecast of falling domestic and world stocks, plus heavy domestic crushing volumes and lower South American production. Today soybean futures backed off just over a nickel to close near $10.79 per bushel at the Chicago Board of Trade.
There were several sections of reports released yesterday concerning soybeans such as, world grain stocks for the end of this current fiscal season, the May ’16 global supply demand report, and an update of its forecast for soybean stocks for the next season. This season coming to a close the USDA forecasts stocks to be 74.25M tons – 3M tons less than last month’s forecast, and 2M tons less than the analysts were forecasting – and next season they expect stocks to be down to 68.21M tons – a three-year low and nearly 5M tons below expectations.
“With the sudden Chinese buying spree of recent, and the surprise soybean market numbers from yesterday, the market may have been taken off-guard,” said Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, sharing his fundamental assessment of the soybean futures market. Plotkin added, “It appears as if a classic case of demand outpacing supply may be in the works for the soybean (futures) market…we’ve only begun the summer rallying season.”
Soybean futures trend is up with no top yet in sight. Soybean futures may be realizing key resistance at this time, but higher prices may easily be seen after the coming dips in the marketplace.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
Rice Futures Rally Little From Lows Despite Asian Drought
Rice futures have rallied only $1.50 from its lows just six weeks ago although severe drought reportedly threatens Asian rice production in SE Asia. Rice futures are up .185 cents today currently trading at $11.40 (per cwt) at the Chicago Board of Trade.
Adverse dry weather is said to be affecting the rice production from SE Asia and west to India thanks to the El Nino phenomena. Some officials say that if it weren’t for last year’s overwhelming surplus, then rice prices would be impacted much more.
“Despite El Nino hurting crops for the largest exporters of rice in the world, there has been little price increase,” said Nathan Childds, an agricultural economist with the US Department of Agriculture, sharing his fundamental assessment of the rice futures market. Childs added, “Unlike other grains, rice (futures) is not traded on a global exchange, and many purchases are between governments or private parties.”
The trend for rice futures has turned “up” in the latter part of last month. I would expect rice futures to at least test its late March/early April lows before much higher prices potentially could be seen, but we are all enjoying low rice prices since its record highs (of near $33.30) in 2008.
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
Schad Commodity’s Weekend Report: An Insider’s View of the Next Big Market Move
Once each week, usually on Friday evenings, we update our personal weekly commodity trading charts and review them for changes in “net long” or, “net short” holdings between the big commercial commodity traders, large speculators, and the usually uninformed public. This is our professional analysis of “the bigger picture” and current dynamics for each market which provide a spyglass view of the BIG commercial traders and what they are currently doing to influence the futures markets.
As you may already know, insider trading with stocks on Wall Street is very illegal. However, in the commodity trading industry, large/commercial traders MUST report their positions EACH WEEK to the CFTC regulatory body, hence, we monitor them on a weekly basis. Although the futures markets themselves will ultimately provide the most accurate illustration of trend, these (weekly) charts we’ve identified, serve to forewarn us of the next possible bigger move.
Here are the commodity markets which illustrate the changing bigger picture for them:
UP Trending Futures Markets: Japanese Yen, Gold, Euro-currency, Soymeal, Crude Oil, Silver and CBT Wheat
DOWN Trending Futures Markets: Kansas Wheat
ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION.
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