Agricultural Commodity Futures Bullish Positions Cut by Funds

Hedge funds reportedly continue to cut their bullish positions to the longest extent this year, although the downside to the wheat futures markets may be limited if the commitment of traders weekly report is to be believed. The grain markets are mixed across the board today with soybeans and meal up for the day, while both wheat’s, corn and soy oil continue to lag at the Chicago Board of Trade. The commodity futures regulatory agency – the Commodity Futures Trading Commission – reports large speculators (or, managed money) reduced their long positions last week from the 13 most traded agricultural products from cattle to cotton by almost 57,000 contracts. This has been the fifth straight week big money has reduced their shorts and something we don’t see quite often – not since last summer anyway. Laura Taylor, a senior market strategist at RJO Futures in Chicago, shared her fundamental view of the agricultural commodity futures markets by stating, “After five weeks of reducing bullish bets, the amount of grain and other products in storage must be more than previously thought.” Taylor adds, “Only wheat futures appear to be closer to neutral.” All agricultural commodity futures we trade are in strong down-trends with an exception of the three New York food & fiber markets we trade – coffee, sugar, and cotton. It is going to take much fundamental change to turn things around, most likely, but consumers should be in for some relief after food prices spiked earlier this decade.. ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK OF...

Rally in Commodity Futures Markets ‘Still in Early Stages,’ Says Leading Expert

Last week leading commodity futures trading analyst David Hightower told the Agrimoney Investment Forum that this current rally in the overall agricultural markets are still in their early stages due to demand coming from emerging countries. Overall, all grain futures and livestock markets are in up-trends at the Chicago Board of Trade and the Chicago Mercantile Exchange, except for cattle futures. Hightower believes the costs of commodity production have been suppressed for the last six months to a year and can’t be kept down much longer. Even though the commodities index has risen over 12% this year, he claims they remain well below historic highs. David Hightower, founder of the influential “Hightower Report” from Chicago, shared his fundamental view of the agricultural futures markets by stating, “We are much closer to the bottom for commodity prices than to a high.” Hightower adds, “If you think you have missed the commodities move – think again.” After reaching significant highs earlier in the month, agricultural commodity futures have pulled-back significantly enough to start looking for entry signals to the buy side for at least a test of recent highs. Cattle futures, however, continue to trend in the opposite position while hog futures recently extended their gains. 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...

China’s High Demand Commodity Said to be Feeding Half the World’s Pigs: Soymeal Futures

Soymeal futures are up today amid continued buying of the soy-based byproduct in order to feed their pig-population – which happens to reportedly be about 50% of the world’s pork population. Soymeal futures are currently “up” $1.4 per ton today currently trading at $410 per ton at the Chicago Board of Trade. Soymeal prices in China are said to be up 40% with the volume of soymeal contracts continuing to expand with the animal feed trading in more hands there in a single day than the US consumes in an entire year – completely dominating the Chicago Board of Trade! Also contributing to the demand in soymeal is the fact that dry-weather and flooding in the Southern Hemisphere continue to threaten global supplies of soybeans which are crushed to produce both soybean oil and soymeal used to feed livestock animals. Monica Tu, a Shanghai-based analyst with Shanghai JC Intelligence Co., who specializes in the soy market, shared her fundamental view of the soymeal futures market by stating, “Downstream users and traders in China have previously kept low stockpiles of soymeal on the expectation of weak demand and prices.” Tu adds, “In recent months, they had to amend their views and restore inventories, supporting solid gains in futures.” The trend for soymeal futures is up, however, with a short-term top in sight. There has not been any type of significant pull-back in this market and we are due for one, but I would expect continued strength in soymeal futures into summer. ALL COMMENTARY IS CONSIDERED OPINION & VIEWS FROM THE AUTHOR AND NOT A SOLICITATION OF ANY SECURITIES. THE RISK...

China’s Demand a Boon for Chicago Board of Trade Grain Futures

Grain futures are thumbing their nose at glut supplies with their recent rally not seen in months, and its all about China’s demand outlook. Grain futures are up all across the board with soybean futures up another .20 cents trading just over $9.56 per bushel at the Chicago Board of Trade. It was only yesterday the USDA monthly crop production report was released forecasting even more global grains inventories, but China’s perceived economic situation is what grain traders are focusing on right now. Just when we thought corn futures were on their way down, they made new highs for the year today, and soybean futures are at their highest since August. “With the grain (futures) markets recent spike, I’d say this is a show of confidence on a global scale,” said Barb Levy, chief director for The Fox Group’s futures division in Chicago, sharing her fundamental assessment of the grain futures market. Levy added, “…and with ‘La Nina’ weather conditions right around the corner, this could be just the start of higher markets to come by early Summer.” The grain markets trends are mixed at this time – soybean futures in a newly emerged up-trend, corn futures being revived from contract lows, and wheat futures still in a technical down-trend. I would consider awaiting the dust to settle in these grain futures markets and hopefully a dip to be a buyer before jumping on this high-speed train. 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...

Brazilian Crush Set for Record High Lifts Soybean Futures

Soybean futures are higher today amid news the Brazilian soybean crush being headed to an all-time high due to soymeal and biodiesel demand, plus firm soymeal exports. Soybean futures are up .0225 cents today currently trading at $8.88 per bushel at the Chicago Board of Trade. The USDA’s Brasilia-bureau raised its soybean crush 25% in the fiscal year to February 2017 to 4.5M tons reportedly due to higher domestic & export demand for both soybean and soybean oil products. The domestic side of demand is partially due to higher demand in both the pork & poultry industries, and a weaker currency opening doors for new markets. Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, shared his fundamental view of the soybean futures market by stating, “The benefits of a weaker currency cannot be overlooked as in this case the boost to the agriculture and livestock industry.” Plotkin adds, “Even the demand of biodiesel fuel is helping the soybean industry there in Brazil.” The trend for soybean futures has turned back “up” only yesterday. Soybean futures has been a see-saw market since last summer and I have a feeling when it takes off in one direction or the other, it may be significant. 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...

Bleak Crop Prices Cause 46-Year Low for Domestic Sowings: Wheat Futures

Wheat futures are finding temporary support with the word out today that farmers are cutting back on their wheat sowings due to prices reportedly having the outlook of falling back to what they were a decade ago. Wheat futures are up .03 cents today currently trading just above $4.54 per bushel at the Chicago Board of Trade.. In its primary report for US crop sowings this year, the USDA estimates farmers will abandon 3M acres this year due to expected price reductions for certain crops such as wheat, soybeans, and corn. It’s not just winter wheat with this circumstance either, but spring wheat is also estimated to decline by 5% with 3.6M acres being abandoned for “all-wheat” production total. “Farmers are doing their best to economize their time, energy, and overhead with the current glut situation while grain prices were high,” said Gerry Plotkin, a Senior Market Strategist for R.J. O’Brien in Chicago, sharing his fundamental assessment of the wheat futures market. Plotkin added, “Soybeans and corn are also expected to see less acreage for sowings, but cotton seems to be bucking the trend with an additional 800,000 thousand acres for plantings.” The trend for wheat futures remains down with further losses expected going into the harvest period. Wheat futures have just made new contract lows only yesterday – so 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...