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Schad Commodity Blog & Commentary
This commentary is intended to provide unique insights with my 20+ years experience for the commodity 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:
Cotton Futures Tumble as Turkish Imports Set to Rise
Cotton futures is taking a dive today despite the USDA’s official statement of Turkish cotton dropping 17% this season because of low farmer returns. Cotton futures are are down $1.13 today, currently trading at $61.70 per pound today at the Intercontinental Exchange.
The country of Turkey is the worlds second largest cotton buyer (behind China) and the lower production is reportedly going to help boost import demand by 9%, despite slack local consumption. The fall in plantings, described by the USDA Ankara bureau, is due to better perceived returns with corn in traditional cotton growing regions.
“Farmers all over the world will gravitate to the higher paying crops at any given time,” said Laura Taylor, a senior market strategist at RJO Futures in Chicago, sharing her fundamental assessment of the cotton futures market. Taylor added, “Cotton is one of the harder crops – and rightfully more traditionally profitable – but take the monetary incentive away and the next best profitable crop will be grown.”
Cotton futures trend has been yo-yoing up and down, back and forth all year long. Cotton futures is currently down with no bottom yet in sight.
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: Sugar & Cocoa (New this week.)
DOWN Trending Futures Markets: Feeder Cattle, Euro-Currency, Soymeal, 10yr. T-Notes Soybeans and Gold, Copper, Kansas Wheat, Live Cattle, British Pound & Corn (These six new this week.)
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.
Africa’s Cocoa Exports Sends Cocoa Futures to New Highs
Cocoa futures rallied to new highs today not seen in four-and-a-half years as West Africa’s cocoa season is reportedly off to a great start. Cocoa futures are up 15 points today trading at $3,392 per ton at the InterContinental Exchange in London.
One of Africa’s top agriculture investment bank’s stated the strong start is to be contributed with a rise in farm gate prices encouraging farmers there to drawdown current inventories. Other conditions exist which may keep cocoa in demand since the health of the new crop has yet to be evaluated, and fears of the effect of drier weather affecting this crop.
Nicholas Medina, a futures and options specialist for Capital Trading Group in Chicago, shared his fundamental view of the cocoa futures market by stating, “The African cocoa farmers held back on inventory allowing the market to rally to their desired prices for selling their product.” Medina added, “With cocoa (futures) prices at multi-year highs, with uncertain conditions ahead, this situation can now convert to a ‘weather market’ that will have to be watched.”
The trend for cocoa futures is up with no top in sight. Much resistance at current levels, but has cocoa futures have proved to be a “buy the dips” market for the past couple of months.
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: Sugar & S&P 500 Index
DOWN Trending Futures Markets: Feeder Cattle, Euro-Currency, Soymeal, 10yr. T-Notes and Crude Oil, Lean Hogs & Soybeans (These three new this week.)
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 Near Unchanged as Chinese Inventories “May Fall”
Corn futures will have much to take in as China’s corn stocks are reportedly ready to plateau or begin to fall in the next growing season of 2016-2017. Corn futures are down .01 cent today currently trading at $3.6125 at the Chicago Board of Trade.
The USDA’s Beijing bureau reports that after six continuous years of corn inventory increases that there is the “potential” for a forthcoming decline after a subsidy cut for farmers announced this past September. Plus, the Chinese government is enhancing sweeteners to users as a way to help eliminate its large corn inventories.
Kevin Craney, Director of Managed Futures at RJO Futures in Chicago, shared his fundamental view of the corn futures market by stating, “The demand for corn in China is real, however, too many farmers tending to this one crop has made the government there cut subsidies which is sounding the alarm for future lower stocks.” Craney added, “The Chinese government may get more involved as I understand even after the lowered floor price, corn is still more profitable than other popular crops.”
Corn futures trend is down but may be finding a support level at these current prices. The $3.60 cent level of support for corn futures has held for a good part of this year.
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.
Brazil’s Focus on Cane for Ethanol Lifts Sugar Futures
Sugar futures has been supported for the past two sessions as it has been reported Brazilian mills are losing ground against ethanol in the duel over sugar cane. Sugar futures are trading “unchanged” today settling near .1471 cents per pound at the InterContinental Exchange in London.
A Brazilian sugar-cane group reportedly released data showing sugar mills diverting just over 42% of their cane for the dedication of sugar rather than ethanol in the latter part of last month. The bullish aspect is that with more cane processed than anticipated for ethanol use, it is the fact that the need of sugar for food is outweighing the need for fuel (on the futures charts).
Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, shared his fundamental view of the sugar futures market by stating, “The need for actual sugar does indeed compete with motor fuel in one of the biggest sugar producing nations in the world.” Plotkin added, “If the demand for ethanol fuel is extra high in the Southern Hemisphere, this could create a bullish market for sugar (futures) indeed.”
The technical trend for sugar remains “up,” but is somewhat at a crossroad. Sugar futures is testing its recent highs while the volatility is picking-up at these high levels.
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.
Cattle Futures Drop as Animals Fly First Class to China
Cattle futures are all over the charts, and apparently all over the map as 150 cows have been recently loaded-up onto a Boeing 747 in Australia to be flown to China’s central interior for processing. Live cattle futures are down $3.10 per pound today currently trading at $128.82 (CWT) at Chicago’s Mercantile Exchange.
Its the insatiable demand for what was once referred to as “millionaires meat” in China and the profit beef brings to the nation that has them coming in via 747, and if you want to get the cattle inland there is no other way. Beef sells for twice the price in China than the benchmark-rate in Australia and the Chinese are pegged to 2.2M tons of beef by 2025 (according to Rabobank).
Jeff Evans, Vice-President of the Managed Accounts Division for RMB Group in Chicago, shared his fundamental view of the cattle futures market by stating, “With the price of cattle (futures) coming back down to reality, the Chinese demand for beef is becoming more attainable.” Evans added, “There are more middle class in China than ever before and with the rapid urbanization happening all over the country, beef will be on the menu – they are seeing to it.”
Cattle futures trend has been back and forth with a vengeance these past couple of months – currently down. With new lows for cattle futures made just today, there is no bottom for this market yet in sight.
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: Sugar & S&P 500 Index (New this week.)
DOWN Trending Futures Markets: Feeder Cattle, Euro-Currency, Soymeal & 10yr. T-Notes (All new this week.)
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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