Grain Market Update – August 7

Wheat Harvest 2019

The markets have been on the downward spiral the last few weeks. There is a lot of speculation on what the report will read, come Monday at 11 a.m. Many people think that the USDA did not take into consideration the prevent plant acres. That should be on this report which may cause a bump in the corn market. Markets should remain relatively flat until that point, but be proactive once they do come out with targets. You can set your own targets with our Online Target Offer Center, click here.

Weather is still moving the market to some extent. Beans are, in large part, still being effected by the Chinese trade wars one way or another. Consider doing a cash plus with beans for a little premium that may get back to the $8 range for cash prices.

Wheat was effected as of late, due to weather conditions and other countries buying wheat from others outside the US.

Long Term Storage Agreement Listing: a local farmer has listed the reminder of their long term storage agreement, better known as condo storage. If you have an interest in purchasing this click here to see listing or contact Mary Kay for more details. They are listing a price for just this one year or for the remaining 12 years.

Written by: Michael Steingraber, CHS Grain Originator

Grain Market Update – July 24

The corn market has been a bit of a roller coaster these last few weeks. The market is currently running off weather until the next report on August 12, which should give us an accurate depiction of the crops that are out there and how beans and corn will progress through the year. China trade talks are still in discussion, if they do buy beans we could see a return on the bean market.

Do not be afraid to look to next year’s crop already, I still believe we need to be proactive. 2020 new crop corn is still hanging around the $3.75 mark and it may not be a bad idea to set your bench mark at that level. Consider doing an HTA (set futures now and wait for basis to narrow then apply the basis).

Leadership Change Update

Employees were informed July 17 that Gerry Baker from CHS Elburn is going to be our Interim Grain Manager in this time of transition.

The CHS Larsen Cooperative Grain team came together and met with four individuals from CHS Elburn in late July. The team from CHS Elburn will be collaborating with CHS Larsen to ensure all management duties are covered.

CHS Elburn is based in Illinois and handles 150-160 million bushels annually. They have two ethanol plants and one river terminal grain outlet. They have five grain facilities, including one in southern Wisconsin. This knowledgeable team will be a great resource to utilize during this time as they are well versed in grain marketing. Your local grain originator will still be your on-farm contact

The seamless sharing of people resources across CHS businesses, when needed, is a good reminder of the value of our CHS cooperative system.

Any questions call us in the grain department, we are more than willing to help.

Thank you!

Mike Steingraber

Grain Market Update – July 10

7/10/19

The USDA To Release July Crop Report on Thursday

The USDA will be out with its July monthly crop report to be released on Thursday at 11 am.  After the June 28th acreage report, the market will likely take this report with a grain of salt.  The real challenge is and will continue to be being able to accurately predict the amount of actual planted acreage of both corn and beans.  Up to this point, the industry is grasping at straws to figure out what corn and bean acreage numbers actually are.  Most everyone agrees that the 91.7 M corn acres that the USDA released on June 28th are much too high, and the 80 M bean acres are much too low.  The numbers played havoc with the grain markets following the June 28th report.  My best guess is that the corn acres will be close to 89 M acres and beans at 82 M acres.  The USDA will be resurveying all of the producers in the Corn Belt states during the month of July, and then the August 12th USDA report will have the updated acreage numbers based on this resurvey.  Thus, on August 12th, we should have the first solid acreage data of the year.  The market will be trying to position itself ahead of this data release.

After months of wetness especially in the eastern Corn Belt, we have finally been receiving warmer temps and the excessive rain has finally moderated.  This has allowed the corn and bean crops to finally start to catch up in maturity, and the heat and less water has allowed aggressive and productive growth, finally.  The crop will still be late, but maybe with continued heat, as long as the rain still comes, we can close the gap somewhat before harvest.  Most of the corn has now had nitrogen applied and many corn acres are now aggressively growing with a deep green color.

There are major corn and bean acreage in Ohio, Michigan, Indiana, and Wisconsin that did not get planted.  Northwest Ohio, northern Indiana, central Michigan, and northeastern Wisconsin are the worst areas with the largest unplanted acreage.  Folks, this is serious.  There are thousands and thousands of unplanted acres in these areas.  I know as I have travelled through them all.  The major livestock producing areas in west central Ohio, northwestern Michigan, and east central Wisconsin are all in panic mode because they are unclear on how they will secure enough corn to feed their livestock for the next 14 months.  Basis on old crop corn in these areas have skyrocketed higher in Ohio and Michigan to +75 to +100 over at major feed destination locations.  Farmers who have old crop corn are not budging.  They can see that they have a commodity in demand, and they want to get as much as possible during this opportunity.  They also are unsure of their own production this year, so they do not want to sell to much and possibly leave more in the bin to hedge next year’s production.  All of this has caused old corn and new corn basis to rachet higher to severely higher the more east you travel.  CSX Columbus, Ohio corn trains traded today at +75 cents over the September futures today in the east.  This is the high-water mark so far this year.  The extreme strength in old crop corn will continue to support basis and will ultimately cause corn spreads to stay narrow, and likely keep new crop spreads more narrow than normal as well.

The other story today that is not getting much press is the continued efforts to get a new trade deal approved with China.  The US has been working diligently with China for the last 18 months to get a new deal developed, but nothing is concrete as of yet.  However, President Trump did meet with Chinese President Xi last week at the G20 meeting.  The US delegation continues to negotiate with China, but there is still work to be done.  This will be something to watch in the coming weeks.  Ultimately, we need to have a China bean export program for Oct / Nov out of the Gulf as well as the PNW.  My fear is that the weather problems has caused a much higher corn price that is killing our export demand.  South America has the cheapest corn and beans in the world, and China is buying their corn and beans instead of ours.  Long term, this is not good for the US.  Any time we destroy our demand base, it takes years to redevelop these relationships.

Targets Produce Success and Protection For Your Farm

Weather markets will push the market around like a yoyo and produce unprecedented volatility.  However, volatility can be your friend if you have a solid marketing plan and know how much and at what price you feel comfortable selling when the right opportunities present themselves.  If you are not working with one of our grain originators today, please give us a call.  We will gladly sit down with you to create a plan and help you protect your farm.  For a list of our grain originators and the one closest to you, please click here.  These types of volatile markets are a grain marketer’s dream.  The volatility present selling opportunities that are very short lived.  For the disciplined marketer, who knows exactly what commodity he needs to sell and at what level, this is a perfect scenario.  You simply place target orders in our system and at 3 am in the morning next Thursday while China makes an announcement when we are all sleeping, the markets ramps up, hits your target, locks in your contract price, all automatically while you are in bed.  How fantastic is that!  I encourage all of you to start using our online target system.  Its free, easy, and will protect your farm.  Please click here for more information.

New Arrive Delayed Price Rates have Been Reduced

We have reduced our Delayed Price rates for new arrive corn and beans into Readfield and Center Valley.  These rates are for new arrive bushels only, and the rate will be in effect until Oct 1, 2019 when new crop storage rates will go into effect.  The new Delayed Price rate is now FREE through Oct 1, 2019.

What Are The Charts Telling Us?

Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – Sep 19 Corn Futures – Support at $4.13, Resistance at $4.45, Place Targets at $4.40

New Corn – Dec 19 Corn Futures – Support at $4.20, Resistance at $4.48, Place Targets at $4.45

Cash Beans – Aug 19 Bean Futures – Support at $8.71, Resistance at $9.03, Place Targets at $8.95

New Beans – Nov 19 Bean Futures – Support at $8.90, Resistance at $9.22, Place Targets at $9.15

New Wheat – Sep 19 Wheat Futures – Support at $4.98, Resistance at $5.19, Place Targets at $5.15

To see where grain futures are currently trading, please click here.

As always, if I can help you with anything, please call me at 419-279-3809 or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier

Grain Market Update – June 19

What a Bizarre Spring!  The Abnormally Wet Weather Is Causing Problems In All Areas Of The Corn Belt.

The spring will go down as one of the wettest, if not the wettest, in history.  And not just for this area, but for the entire Corn Belt.  We have never witnessed a spring that has been so wet and has caused so many problems with getting our corn and bean crops planted.  Many local areas in Wisconsin, Indiana, and Ohio have been able to only plant 50-60% of their originally intended corn acres, and now the clock is running out on beans as well.  Many, many acres of corn and beans will go unplanted this year.  Some estimates have between 10 – 15 Million acres of corn and beans that won’t be planted, and if the farmer has Prevent Plant Insurance, these acres won’t be planted at all.  If a farmer does not have insurance, then he is continually struggling to get something planted to save his farm.  Corn planted today won’t yield much grain, but it can work for silage, and if you are a dairy farmer, this will be its intended use.  It is entirely too late now to plant corn for grain production as the crop will run into an early freeze, not to mention it will be very wet and suffer from poor test weights and higher FM levels.  Beans planted today could still work, but the window is slamming shut rather quickly.  And as I look at the forecast, the 6-10 day maps continue to look very wet for this area.  Not to mention that the crops that are planted are having a hard time emerging because we are lacking sunshine and heat to rapidly grow the crop.

The market is continuing to have a very difficult time getting its arms around the final planted corn and bean acres this spring, as well as the yield potential for this crop.  With the planting conditions being much below par and everything being at least 3 weeks later than a normal crop, there will be a yield lag that is quite noticeable this fall.  Without boring you with a detailed S & D analysis, my best guess is that corn ending stocks for this fall could easily drop down to 1.2 B bu and if we have a dry summer, it could drop as severely as 800 M bu.  If this happens, this will cause corn to remain very firm, much firmer than it already is.  Much of the corn carry on the CBOT will vanish, as it already has, and basis will firm dramatically.  On beans, the current estimate on bean carryout for this fall is just over 1 B bu.  If the weather does not cooperate, this could very likely be the biggest carryout estimate of the year.  Add to this a new Chinese agreement, and then the bean market could be off to the races because bean exports will all of a sudden grow instantly to China.  Similar to corn, bean carries are about half of what they were just 2 weeks ago, and bean basis is firming as well.

Just like you, the market is very stressed out about not having a clear picture on acres and yields.  It could be months before we have any accurate idea on what this crop will or will not produce.  In the mean-time, the market will gyrate like we have not seen since 2012.  The downside potential for corn and beans is limited, and any surprise in poor weather or a new Chinese agreement will just fuel us to a bullish story.  The corn market is not done rallying yet, and the bean market is very concerned about getting its last few acres planted while still in June.  We have seen the market correct a bit over the last day or so, but this is needed for a healthy bull market.  Corn and beans suffer from a lack of planted acreage and the late timing of the planted crop, and wheat is suffering from excess spring rains which will hurt quality.  None of this is bearish.  I expect that all grains will advance another leg higher once this small correction runs its course.

There are some producers who were very fortunate and were able to get most of their corn and beans planted.  If you are one of these folks, consider yourself lucky, and now you have a very favorable market to price your crop.  Dec ’19 corn futures are currently trading at $4.59  I believe we will have a shot to trade Dec corn up to the $5.00 level in the next few weeks, especially if we have a problem with the weather.  On beans, its anyone’s guess.  If the weather turns dry and we get a new Chinese deal, this market could turn from a sleeping bull to an enraged bull overnight.  The other factor is the actual acres planted, and how NASS is quantifying these acres each week.  Are the acres being planted or are they going to Prevent Plant and no longer being intended to be planted?  And if no longer intended to be planted, NASS is considering these acres planted whether they are actually planted or not.  This is all adding to the market’s confusion and frustration over the amount of planted acres.  This will likely add to the bullish sentiment as we move forward.

For livestock producers, this is going to cause you to pay more for corn in the coming year.  I wish I had better news, but your cost of corn will likely get rather expensive for the next year.  The lack of a planted corn crop locally has caused both futures and basis to firm in dramatic fashion, and frankly, I don’t see it backing off in material quantity until well after harvest.  Local basis has firmed over the last month, and this won’t change much either.  People who need to buy corn will likely need to pay at least option (zero basis under the Chicago futures level) or more to secure corn, if one can even find a source to sell corn to you.  Thus, for all of the above reasons, the corn basis has rallied firmer over the last month and will likely continue to do so.  New crop corn basis has firmed as well, and it will likely remain firmer than normal until past harvest.  I also expect the bean basis to firm as well.  Last harvest bean basis was very cheap due to the huge yields and the lack of Chinese buying.  This year is different, especially if a new Chinese deal is signed.  I don’t see new crop bean basis getting weaker than it is today at 90 cents under November and could firm dramatically if these other factors come into play.  Get your seat belts tightened.  Volatility will ramp up and this will be a wild ride.

New Arrive Delayed Price Rates have Been Reduced

We have reduced our Delayed Price rates for new arrive corn and beans into Readfield and Center Valley.  These rates are for new arrive bushels only, and the rate will be in effect until Oct 1st 2019 when new crop storage rates will go into effect.  The new Delayed Price rate is now FREE until Oct 1st 2019.  After Oct 1st, these bushels will be subject to the new crop storage rates posted at that time and are not known today.

Targets Produce Success and Protection For Your Farm

Weather markets will push the market around like a yoyo and produce unprecedented volatility.  However, volatility can be your friend if you have a solid marketing plan and know how much and at what price you feel comfortable selling when the right opportunities present themselves.  If you are not working with one of our grain originators today, please give us a call.  We will gladly sit down with you to create a plan and help you protect your farm.  For a list of our grain originators and the one closest to you, please click here.  These types of volatile markets are a grain marketer’s dream.  The volatility present selling opportunities that are very short lived.  For the disciplined marketer, who knows exactly what commodity he needs to sell and at what level, this is a perfect scenario.  You simply place target orders in our system and at 3 am in the morning next Thursday while China makes an announcement when we are all sleeping, the markets ramps up, hits your target, locks in your contract price, all automatically while you are in bed.  How fantastic is that!  I encourage all of you to start using our online target system.  Its free, easy, and will protect your farm.  Please click here for more information.

What Are The Charts Telling Us?

Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – July 19 Corn Futures – Support at $4.38, Resistance at $4.64, Place Targets at $4.60

New Corn – Dec 19 Corn Futures – Support at $4.54, Resistance at $4.73, Place Targets at $4.70

Cash Beans – July 19 Bean Futures – Support at $8.94, Resistance at $9.21, Place Targets at $9.15

New Beans – Nov 19 Bean Futures – Support at $9.21, Resistance at $9.48, Place Targets at $9.40

New Wheat – July 19 Wheat Futures – Support at $5.15, Resistance at $5.49, Place Targets at $5.40

To see where grain futures are currently trading, please click here.

As always, if I can help you with anything, please call me at 419-279-3809 or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier

Grain Market Update – May 30

The market has been driven by wet weather across the Corn Belt, but is also effecting us here in the north. Hopefully you were able to get something in the ground. However, if unfortunately, you were not able to get what you needed planted there are options to help take care of your contracts.

Many people are taking insurance or preventive plant alternatives due to lack of planting ability. If you do have corn to market, set targets above $4 and in increments above to hit on the way up. Beans are getting slightly pulled up with corn, but are also on planting delays, so if you can hit a decent $8 price you can add a cash plus for a decent offer to even out the prices for some risk.

The government is planning on issuing out relief support this year probably based off of county averages and not this year’s crop.

If you are not working with one of our grain originators today, please give us a call.  We will gladly sit down with you to create a plan and help you protect your farm.  For a list of our grain originators and the one closest to you, please click here.

Written by: Michael Steingraber, CHS Grain Originator

Grain Update – May 15, 2019

Kimmes spring corn planting

5/15/19

Planting Delays Are Starting To Get Serious

The big news of late is the inability to get our corn crop planted on time, and the real risk of corn acres either not getting planted or they get switched to beans instead.  On Monday’s crop progress report, the US has only planted 30% of its corn crop and last year we were are 59% complete.  On beans, only 9% were planted as compared to 32% last year.  Obviously, the wet weather has prevented the farmer from getting in the field and has pushed all planting significantly back from normal completion rates.  However, as I speak now, the farmer is aggressively planting corn in many areas of the Corn Belt right now, running full bore and around the clock.  Conditions are not perfect, but the calendar is forcing the issue.  Rains are expected to come towards the end of the week, and they are getting it done, one way or the other.

After weeks of relentless fund selling of grain futures at Chicago, this late planting issue finally came to a head on Tuesday as the corn market rallied 15 cents higher and beans over 30 cents higher.  The funds had a record short position in corn of over 325,000 contracts short and beans over 150,000 contracts short, which had been accumulated in the last 30 days.  These funds had been significantly pressing grain futures lower through last week, being relentless on pressing futures lower consistently over the last 3 weeks.  Beans last $1.20 and corn over 25 cents.  However, this mentality started to change on Monday, and the market screamed higher on Tuesday and it is still higher today.  Its all about the lack of planting process on both corn and beans, and now the market is putting more risk premium in the market for delayed planting and yield lag.  The funds were extremely short and this news has caused them to cover their short position buy aggressively buying futures.  This buying has propped up the market in a big way and is giving all of you the opportunity to make “catch up” sales. 

Time will tell whether the farmer will be able to get all of his corn acres planted.  However, there is no other time in history where the farmer has had less capacity to plant massive acreage once the conditions are right.  Today’s farmer has aggressively invested in new planting capacity to be able to plant his crop in very short order.  Yes, we are behind.  But the real question is whether the farmer can catch up on planting.  He definitely has the tools.  He just needs Mother Nature to cooperate.

Even though we are seeing a nice rally, the grain fundamentals still have not changed that much, especially for beans.  Please view this rally as an opportunity to catch up on forward new crop sales that were missed earlier.  The bullish case for corn has more standing power than beans.  Still, this is not the time to get bullish on either corn or beans, but time to think about salvaging a very difficult marketing year.  This is especially true for beans.  This weather scenario will likely add more bean acres at the expense of corn.  The result will be an even bigger amount of beans carried out next year, most likely between 1.0 and 1.3 B bu, which is just huge.  This is the 3rd day of our rally, and you can tell it is starting to lose some of its steam.  Now is the perfect time to place target orders just under resistance levels and get more new beans sold for harvest or next summer if you have bin space. 

Targets Produce Success and Protection For Your Farm

The weather markets are pushing the market around like a yoyo and producing unprecedented volatility.  However, volatility can be your friend if you have a solid marketing plan and know how much and at what price you feel comfortable selling when the right opportunities present themselves.  If you are not working with one of our grain originators today, please give us a call.  We will gladly sit down with you to create a plan and help you protect your farm.  For a list of our grain originators and the one closest to you, please click here These types of volatile markets are a grain marketer’s dream.  The volatility present selling opportunities that are very short lived.  For the disciplined marketer, who knows exactly what commodity he needs to sell and at what level, this is a perfect scenario.  You simply place target orders in our system and at 3 am in the morning next Thursday while China makes an announcement when we are all sleeping, the markets ramps up, hits your target, locks in your contract price, all automatically while you are in bed.  How fantastic is that!  I encourage all of you to start using our online target system.  Its free, easy, and will protect your farm.  Please click here for more information.

What Are The Charts Telling Us?

Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – July 19 Corn Futures – Support at $3.43, Resistance at $3.80, Place Targets at $3.76

New Corn – Dec 19 Corn Futures – Support at $3.63, Resistance at $3.98, Place Targets at $3.95

Cash Beans – July 19 Bean Futures – Support at $7.91, Resistance at $8.58, Place Targets at $8.48

New Beans – Nov 19 Bean Futures – Support at $8.15, Resistance at $8.80, Place Targets at $8.70

New Wheat – July 19 Wheat Futures – Support at $4.19, Resistance at $4.60, Place Targets at $4.55

To see where grain futures are currently trading, please click here.

Have You Sold Enough New Beans Yet?  Make Values Even Better With Cash Plus Contracts

I can build a solid case why beans will move lower in the coming weeks as more acres get planted and less corn.  In addition, the bean planting window is not nearly as tight as the optimum corn planting window.  If you still have new beans to sell, please check out our Cash Plus Contracts.  We can add a premium to your new crop bean sales price in exchange for an offer to sell more new beans if November Bean futures close above a certain level on Oct 23rd.  (These premiums are for contracts in 5,000 bushel increments only.)  These contracts will allow you to sell new beans today with a 36 cent premium added to the new crop cash price in exchange for an offer to sell the same quantity of new crop bean futures at $8.60 if on Oct 23rd, the November bean futures close at or above this level.  If futures close below this level, you get to keep this entire premium, and you don’t have any other obligation.  So it is a win-win for you.  You get to keep the 36 cent premium paid to you on top of the current new crop bean price, and if on Oct 23rd, depending on what November bean futures trade at the close on this date, you might be able to keep this entire premium free and clear.  The worst case is that you would have the same bushel commitment in another new crop sale where November futures were locked in at the $8.60 level.  Taking off the basis of 92 cents under the November futures for delivery into Readfield, which is our current posted new crop bean basis, you would have a new crop bean contract at 8.60 – 92 (basis) + 36 cent premium = $8.04  The worst case is that you would have another set of new beans sold at $8.60 November futures for Oct / Nov ’19 delivery into Readfield or Center Valley. 

As always, if I can help you with anything, please call me on my cell at 419-279-3809 or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier

Grain Update – April 11, 2019

4/11/19

USDA Shows More Corn, But Market Holds Steady

The USDA released its April crop report on Tuesday and showed more corn stocks than originally thought.  However, the market held firm after the release.  Let’s look at the details.

In the corn market, the USDA reduced feed usage by 75 M bu down to 5.3 B bu.  They also reduced the amount of corn used by the ethanol industry by 50 M bu down to 5.5 B bu.  This industry continues to struggle with a lack of margins, and the industry is not running at capacity at this time.  This helps to explain why corn usage has backed off.  Finally, corn exports were reduced by 75 M bu down to 2.3 B bu as well.  The US market is struggling to find export demand.  Last year, the PNW was very busy shipping corn to China.  This year, Brazil and Argentina have huge corn crops on the horizon and their price is substantially cheaper than corn from the US.  In fact, they have the cheapest corn in the world now, and the Chinese are buying their corn and not ours.  On top of all of this, the Trump administration and China continue to work together to try and get a new agreement in place to end the tariff war between the two countries.  This is allowed China to not buy corn like in past years as well.  Its been a very long time since we have seen the USDA reduce all three of these categories on the same report, and it added to the heaviness of the report.  When the dust settled, there were 200 M bu of corn added to ending stocks, increasing this final number to 2.035 B bu.

As I have said many times, having a corn carryout starting with a “2” puts the market in comfort mode.  Supplies are plentiful, and the market will likely see no need to rally.  However, we have a mounting problem just around the corner.  This relaxed sentiment makes the assumption that we have no problems planting a 92.8 M acre corn crop.  Will the US be able to get all of this corn planted at the right time as major areas of the western and northern Corn Belt sit now with a major snow or rain event on top of it right now?  Even with no snow or rain today, vast areas still are dealing with wetter and colder soil conditions which will likely press the corn planting date well into May.  Now, with more snow and rain, it just keeps pushing the likely corn planting date farther and farther into the back edge of the appropriate planting window for corn.  If any other weather systems develop and drop more precipitation in these areas, I can easily see many corn acres get switched to beans.  If this happens, all of a sudden, we don’t have such a plentiful corn supply.  In the coming days, I see the corn market becoming much more sensitive to the weather situation.  On top of this, the funds are extremely short corn futures, and all we need is a reason for them to cover (buy) their short position back, and we could have an explosive corn market on our hands until the we get our corn completely planted.  Thus, I am not bearish corn.  There is a real potential for the corn market to bounce from these levels and rally until at least we get 50% of the crop planted.  It is a real risk, and the market will eventually recognize it, at some point.

The bean market is totally different.  But first, lets look at the USDA report.  Unlike corn, the USDA made very little changes to the Supply and Demand table during April.  They reduced imports by 3 M bu and increased seed usage by 2 M bu.  But the most obvious change that is needed, they failed to adjust, again.  They left bean exports at 1.875 B bu and continue to leave bean exports alone.  If the USDA was honest with us, they would start cutting these back instead of waiting until the end of the crop year to slash them.  My best guess is that exports will be lowered (eventually by 200 M bu or so.  When this happens, bean carryout will grow from its current 895 M bu to at least 1.1 to 1.2 B bu.  Folks, this is a lot of beans.  Many producers went ahead and used the $1.65 from the USDA and used this payment to supplement their cash flow needs and left their beans in the bin or in storage, and still unpriced.  I can build a case where beans move lower and lower as more and more corn acres get planted with beans, and the farmer won’t move their beans until they are forced to do so just prior to fall harvest.  Thus, we could have a very heavy farmer deliveries during Aug / September and have 2 harvests back to back.  This will add increased pressure to futures and basis as more beans are rammed in the pipeline.

Most farmers are waiting for a China deal to be finalized before selling more of their beans.  My best guess is that Trump will demand a perfect agreement with China, and this will take another 6-8 weeks to get accomplished.  By then, the opportunity for China to buy any more old beans will be completely over.  Brazil and Argentina have the cheapest beans in the world right now, and their bigger than average yields will continue to press bean prices lower and lower.  On top of this, if the US farmer cannot plant his corn crop due to wet / cold weather, and instead plants beans to be able to survive, the beans carryout will continue to expand and beans are /  will be extremely over priced compared to today’s values.  Thus, I am bearish beans in a big way.  The market is not looking at these fundamentals yet, but as we inch closer and close to planting, and experience continual delays in plating corn, the market will be forced to recognize it in a big way.  The real risk here is a substantially lower bean futures market and a substantially wider new crop basis levels that will be considerably wider than last years wide basis level.  If I were you, I would take action today to protect your farm.  Please click here to see which grain originator on our staff can help you create a unique marketing plan for your farm, and help you place target orders in our online system.  I offer further explanation below.

What Are The Charts Telling Us?

Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – May 19 Corn Futures – Support at $3.55, Resistance at $3.66, Place Targets at $3.65

New Corn – Dec 19 Corn Futures – Support at $3.84, Resistance at $3.96, Place Targets at $3.95

Cash Beans – May 19 Bean Futures – Support at $8.83, Resistance at $9.12, Place Targets at $9.02

New Beans – Nov 19 Bean Futures – Support at $9.18, Resistance at $9.39, Place Targets at $9.34

New Wheat – July 19 Wheat Futures – Support at $4.35, Resistance at $4.82, Place Targets at $7.78

To see where grain futures are currently trading, please click here.

Have You Sold Enough New Beans Yet?  Make Values Even Better With Cash Plus Contracts

I can build a solid case why beans will move lower in the coming weeks as more acres get planted and less corn.  In addition, the bean planting window is not nearly as tight as the optimum corn planting window.  If you still have new beans to sell, please check out our Cash Plus Contracts.  We can add a premium to your new crop bean sales price in exchange for an offer to sell more new beans if November Bean futures close above a certain level on Oct 23rd.  These contracts will allow you to sell new beans today with an 18 cent premium added to the new crop cash price in exchange for an offer to sell the same quantity of new crop bean futures around $9.60 if on Oct 23rd, the November bean futures close at or above this level.  If futures close below this level, you get to keep this entire premium, and you don’t have any other obligation.  So it is a win-win for you.  You get to keep the 18-cent premium paid to you on top of the current new crop bean price, and if on Oct 23rd, depending on what November bean futures trade at the close on this date, you might be able to keep this entire premium free and clear.  The worst case is that you would have the same bushel commitment in another new crop sale where November futures were locked in at the $9.60 level.  Taking off the basis of 92 cents under the November futures for delivery into Readfield, which is our current posted new crop bean basis, you would have a new crop bean contract at 9.60 – 92 +18 cent premium = $8.86  The worst case is that you would have another set of new beans sold at $8.68 for Oct / Nov ’19 delivery into Readfield or Center Valley.  This is a good price considering our posted new crop price is at $8.38 or so today.  Please check this out.  We have been writing many of these contracts as of late, and they work really well.  Please click here to see our current cash grain bids.

Targets Produce Success and Protection For Your Farm

Before long, weather markets will push the market around like a yoyo and produce unprecedented volatility.  However, volatility can be your friend if you have a solid marketing plan and know how much and at what price you feel comfortable selling when the right opportunities present themselves.  If you are not working with one of our grain originators today, please give us a call.  We will gladly sit down with you to create a plan and help you protect your farm.  For a list of our grain originators and the one closest to you, please click here.  The volatility present selling opportunities that are very short lived.  For the disciplined marketer, who knows exactly what commodity he needs to sell and at what level, this is a perfect scenario.  You simply place target orders in our system and at 3 am in the morning next Thursday while China makes an announcement when we are all sleeping, the markets ramps up, hits your target, locks in your contract price, all automatically while you are in bed.  How fantastic is that!  I encourage all of you to start using our online target system.  Its free, easy, and will protect your farm.  Please click here for more information.

LAST CALL For New Crop Average Price Contracts – Sign Up Today

We are now enrolling bushels into our new crop Average Price Contract which is for new crop grain that will be delivered during this fall.  This is a cash contract and will use a 10 week period to average the price.  The timing of the new crop contract will be May 1st through July 3rd.  We will simply average the closing prices each Wednesday during these periods, pricing 1/10 of your contracted bushels each week during the period.  At the end of the period, we will simply average the prices together.  There is no minimum quantity and the best part of these contracts are that they are FREE.  There are no fees associated with these averaging contracts. 

The dates associated with the new crop pricing period of May 1st  to July 3rd  is normally a very good time to sell new crop grain because the market is dealing with planting problems and then dealing with dry weather problems somewhere in the Corn Belt.  When problems surface, the market puts more risk premium in the futures, and you will be participating in the market to capture these premiums.  If there are no problems, the market usually drifts lower after the July 4th holiday, making the timing an excellent part of this new crop average contract.    These contracts are simple, easy to understand, and they work.  Every farmer should put a decent amount of grain into these contracts to help protect your farm.  For more information on these exciting new contracts, please click here.

As always, if I can help you with anything, please call me at the grain office on my cell at 419-279-3809, or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier

Grain Update – March 2019

USDA Report was a Non-Event

The USDA released its March crop report last Friday which turned out to be mostly anticipated by the market, and it did not send shock waves through the industry.  There was a slight surprise in corn as ending stocks did rise more than expected.  Let’s look at the details.

In the corn market, the USDA did reduce corn used in the production of ethanol by 25 M bu down to 5.55 B bu.  The ethanol industry has been plagued with very slim margins over the last 6 months and this has caused the industry to slow their grind.  The USDA also reduced corn exports by 75 M bu down to 2.375 B bu.  The big crop of corn being grown in Brazil and Argentina today is cheaper than the corn that can be purchased from the US.  China is buying their corn and not ours, and this is weighing on exports.  When the dust settled, corn ending stocks for this year grew by 100 M bu from 1.735 B bu to 1.835 B bu.  This change was not expected by the market and this helped to press the market lower after the report.

On beans, the USDA made small tweaks to the supply and demand table.  The only change was an increase in bean crush by 10 M bu to 2.1 B bu.  Bean crush margins have been and continue to be stronger than normal this year.  This helps explain why crush rates continue to be strong.  Amazingly, the USDA made no adjustment to bean exports at 1.875 B bu.  Comparing last year to this year, the Chinese have purchased 639 M bu less beans this year due to the tariff war.  Yet, when you compare the bean exports from last year of 2.129 B bu to the 1.875 B bu this year, this is only a reduction of 254 M bu.  What about the other 385 M bu?  Maybe the Chinese will come and buy more beans, but the window of opportunity is quickly slamming shut.  It might be possible for another 85 M bu to be sold.  If this happens, the end result of 300 M bu beans from less exports this year will push the final bean export number down to 1.575 M bu and this same 300 M bu will fall right into the ending stock number, and raising it to 1.2 B bu.  This is likely where the ending stock number will grow to and this helps explain why the market did not rally on Friday even though the ending stock number posted was actually reduced by 10 M bu down to 900 M bu.  The market simply does not believe the current export number.

We have heard time and time and time again that the Chinese will come and buy massive amounts of beans from the US.  Obviously, the Trump administration and the Chinese government are continuing to work on a new trade deal.  Trump decided not to increase the tariffs on $200 B of Chinese products from 10% to 25% on March 1st when no agreement was made.  He did not want to disrupt the momentum in the current negotiations.  The best guess today is that a new deal between the US and China will not occur until sometime in April.  In the mean-time, traders are tired of taking positions in anticipation of these Chinese purchases until they actually happen.  They are tired of being hood winked and loosing money when the Chinese purchases don’t develop.  Initially, the bean market popped up at every single new tweet or new headline.  Today, the market is ignoring these false signals and is only rallying when actual bean sales are published.  As of late, the bean market could not even do this as the amount of beans actually purchased are only a fraction of what was promised several weeks ago.

In addition to the loss of bean sales to China, there are two other factors that are pressing the market as of late.  The first is much improving weather in South America.  The second is a massive short position taken in the corn and bean markets by the funds.  Let’s examine these issues.

Northern areas of Brazil had been very dry going back 2 months ago.  Since that time, Brazil’s weather has stabilized, and northern Brazil has received nice rains over the last few weeks.  Argentina did suffer from excessive water in the early growing season, but less rains have fallen as of late.  The end result is that both the corn and bean production in both Argentina and Brazil have stabilized and now are increasing in volume.  Looking at total South American bean production, the current crop is pegged at 181.6 MMT (6.67 B bu) as compared to 171.2 MMT (6.29 B bu) last year.  As you can see, bean production is substantially higher this year, and bean shipped from Brazil or Argentina to China are considerably cheaper than the bean originated from the US going to China.  Also, the US produced 4.412 B bu of beans last year compared to their 6.29 B bu of beans.  South America is now the leading producer of soybeans and helps explain why our bean ending stocks have exploded higher in recent years.

Finally, the funds have a massive short position now in all grains.  In corn, the current estimate is that managed money is short approximately 200,000 contracts.  In beans, they are short approximately 75,000 contracts.  These are huge short positions and help explain why the market has been pressed significantly lower over the last 2 weeks.  The funds are nearing their record short position levels, so their continued selling will likely be limited.  However, anything is possible.  At some point, these funds will likely cover (buy back) their short positions due to a planting scare are a weather problem in the April – June timeframe.  Now is the time for all of you to put firm targets into our system to sell when the market pops back.  Additionally, the USDA will release their Perspective Planting report on March 29th.  This report will finalize the corn and bean acres for this growing season.  This report historically produces a very volatile market reaction and pushes the market based on the new production data.  This could be an opportunity for the funds to cover some of their short positions if acreage comes in significantly different than expectations.  I seriously recommend that all of you have target orders in place ahead of this report.  Please click here to see which grain originator on our staff can help you create a unique marketing plan for your farm, and help you place target orders in our online system.  I offer further explanation below.

New Crop Average Price Contracts – Sign Up Today

We are now enrolling bushels into our new crop Average Price Contract which is for new crop grain that will be delivered during Oct / Nov ’19 into our grain facilities.  This is a cash contract and will use a 10-week period to average the price.  The timing of the new crop contract will be May 1st through July 3rd.  We will simply average the closing prices each Wednesday during these periods, pricing 1/10 of your contracted bushels each week during the period.  At the end of the period, we will simply average the prices together.  There is no minimum quantity and the best part of these contracts are that they are FREE.  There are no fees associated with these averaging contracts. 

The dates associated with the new crop pricing period of May 1st to July 3rd is normally a very good time to sell new crop grain because the market is dealing with planting problems and then dealing with dry weather problems somewhere in the Corn Belt.  When problems surface, the market puts more risk premium in the futures, and you will be participating in the market to capture these premiums.  If there are no problems, the market usually drifts lower after the July 4th holiday, making the timing an excellent part of this new crop average contract.    These contracts are simple, easy to understand, and they work.  These contracts are a very good tool for you to use and they allow the co-op to sell fall trains ahead of the busy harvest period.  Every farmer should put a decent amount of grain into these contracts to help protect your farm.  For more information on these exciting new contracts, please click here.

Have You Sold New Beans Yet?  Make Values Even Better With Cash Plus Contracts

If you still have new beans to sell, please check out our Cash Plus Contracts.  We can add a premium to your new crop bean sales price in exchange for an offer to sell more new beans if November Bean futures close above a certain level on Oct 23rd.  These contracts will allow you to sell new beans today with a 21 cent premium added to the new crop cash price in exchange for an offer to sell the same quantity of new crop bean futures around $9.55 if on Oct 23rd, the November bean futures close at or above this level.  If futures close below this level, you get to keep this entire premium, and you don’t have any other obligation.  So it is a win-win for you.  You get to keep the 21 cent premium paid to you on top of the current new crop bean price, and if on Oct 23rd, depending on what November bean futures trade on the close on this date, you might be able to keep this entire premium free and clear.  The worst case is that you would have the same bushel commitment in another new crop sale where November futures were locked in at the $9.55 level.  Taking off the basis of 90 cents under the November futures for delivery into Readfield, which is our current posted new crop bean basis, you would have a new crop bean contract at 9.55 – 90 = $8.65   The worst case is that you would have another set of new beans sold at $8.65 for Oct / Nov ’19 delivery into Readfield or Center Valley.  This is a decent price considering our posted new crop price is at $8.36 today.  Please check this out.  This is another excellent contract which puts more money in your pocket.  Please click here to see our current cash grain bids.

What Are The Charts Telling Us?

Looking at the charts today, all grains made a fresh high about a month ago.  Since then, we have been pulling back.  Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – May 19 Corn Futures – Support at $3.61, Resistance at $3.75, Place Targets at $3.70

New Corn – Dec 19 Corn Futures – Support at $3.86, Resistance at $3.91, Place Targets at $3.91

Cash Beans – May 19 Bean Futures – Support at $8.89, Resistance at $9.07, Place Targets at $9.00

New Beans – Nov 19 Bean Futures – Support at $9.24, Resistance at $9.35, Place Targets at $9.32

New Wheat – July 19 Wheat Futures – Support at $4.36, Resistance at $4.60, Place Targets at $4.55

To see where grain futures are currently trading, please click here.

Take Advantage Of Selling Opportunities With Online Targets

Just prior or after the monthly USDA grain reports, volatility really ramps up in the grain markets.  This causes the futures levels to move around much more than during the rest of the month.  I encourage all of you who need to sell grain to use targets to take advantage of a pop in the market.  It is simply amazing what these markets can do in a very short amount of time.  There is simply no way we can communicate to all of you during a 15 minute rally that happens right during a crop report.  That is why targets work so well.  It allows you to have resting orders already in position at Chicago so when the market starts to gyrate, your orders get picked off and you can take advantage of a very nice pop in the market. Targets are a great tool to help you lock in better returns for your farming operation.  You can call us and we can enter them for you, or you can do it all by yourself by entering them online through our Online Bid Center by clicking here.

CHS Larsen Co-op To Host Grain Marketing Meetings

On April 3rd and 4th, we will be hosting 3 Grain Marketing Meetings throughout our draw area.  Meetings will be held in New London, Waupaca, and Larsen.  Brian Rydlund from CHS Hedging will be joining us to go over the current S&D’s and also offer his recommendations for contracting and marketing.  It will be a lively discussion on current grain topics.  You are welcome to attend.  For more information on the location, times, and how to RSVP, please click here.

As always, if I can help you with anything, please call me at the grain office in New London at 419-279-3809 or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier – Grain Dept Manager

Average Price Program Enrollment Open

Even after positive numbers on the report a few weeks ago, prices still do not seem to be positive. South America is running the bean market during harvest and corn seems to be piggy backing off bean trends, which do not help at all. Not to mention Chinese tariffs are not helping either. Setting targets at reasonable levels in the near future may be your best bet.

Our average price program enrollment has opened. The average price contract prices out an even number of bushels, at the close of every Wednesday. This happens for a 10 week period from May 1st to July 3rd. This program is a useful tool to use as a benchmark for your grain marketing, also it is free of charge. Click Here to learn more.

If you have questions or want to get some contracts in place feel free to reach out to Mike Steingraber and he would be happy to go over options with you.

Written by Mike Steingraber, Grain Originator

Grain Update – February 13, 2019

After 2 Months, We Finally Get A USDA Report.  Unfortunately, It Does Not Change Much

The USDA was out with its monthly crop report last Friday for the Grain Industry.  The report was a rather large data dump as this report was the combination of the Jan ’19 and Feb ’19 monthly data.  The government shutdown prevented the USDA from releasing its January report on time.  Thus, Friday’s report gave us first quarter grain usage, winter wheat planted acreage, final numbers from the ‘17/18 crop, and the supply and demand and ending stocks update for the current month.  Since the grain trade was waiting on this information for 2 months, it was widely anticipated and projected to be a game changer.  In the end, it changed little and came back as mostly as expected with little market reaction.

In the corn market, the USDA reduced the corn yield by 2.5 bpa down to 176.4 which caused total corn production to drop 206 M bu down to 14.42 B bu.  This change was mostly as expected by the market, and already factored into futures.  On the demand side, the USDA reduced corn used for feed by 125 M bu down to 5.375 B bu.  This was not expected by the market.  We have a big increase in total livestock now consuming corn, so how can feed corn usage go down?  The USDA also reduced corn used for ethanol by 25 M bu and reduced corn used for seed by 15 M bu.  When the dust settled, the corn ending stocks for this crop year was reduced by 46 M bu down to 1.735 B bu.  As discussed, the market pretty much anticipated this yield cut and the resulting reduction in corn ending stocks.  Generally, a 2.0 B bu carryout puts the market into comfort mode, and a 1.5 B bu carryout starts to put the market on edge.  This level allows the market to remain at the status quo as if we look back through history, this type of carry over number is actually quite common. 

The market will be looking forward to how the South American corn crop develops and if Brazil’s corn crop will have its yield trimmed like its beans.  Additionally, the market is projecting US corn planting intentions around 92 M acres this spring.  Dec corn futures are hovering just above $4.00 today.  Corn acres could get a bump if Dec corn rallies upwards close to the $4.25 level.

On beans, the market is a bit different.  It is currently being pushed around by the latest tweet, and the most recent headlines coming out of the US / China negotiations as the teams aggressively try and end the tariff war prior to the March 1st deadline.  If no agreement is made between the US and China by March 1st, the 10% US tariffs on China’s goods that we buy will increase from 10% to 25%.  This is a huge deal to the Chinese because they hate these tariffs, but it is the major item that is forcing China to be honest and negotiate with the US.  In the end, it will be Trump who will make the final decision to extend the March 1st deadline if no deal is made, but significant progress has / is occurring.

China is now done with buying beans from the US and from this point forward, they will buy all of their beans from South America as their beans are the cheapest in the world and both Argentina and Brazil are in major harvest mode today.  Argentina’s bean crop is just massive, but the Brazilian bean crop has been trimmed down to the 115 MMT level or so due to dry weather.  In the last week, Brazil has received more rain and Argentina received less rain which is benefitting both countries.  Thus, we could see the bean yields improve on both as we move forward.

Nearby, the bean market is in a tug-of-war between the big optimism of a new China trade deal, and the yield reducing weather in Brazil.  The fact is that neither will affect the outcome of this year’s world bean carryout that much.  The world has a huge cushion of excess beans, and once the Brazilian crop gets harvested, and the market sees that their volume is still quite substantial, and once the US gets its bean acres planted and emerged, I believe we could see a major reduction in bean prices going forward.  The US bean carryout is between 900 M and 1.0 B bu and could grow substantially going forward depending on final bean acres and planting weather.  Nov ’19 bean futures above $9.50 is a gift and should be sold by the farmer.  We have beans tucked away in many areas of the Corn Belt this year as the farmer hated the wide basis levels this past fall.  One can build a case where we have back to back bean harvests in late summer as the farmer cleans out his bins just before fall harvest to make room for new crop.  This will likely pressure futures and basis lower to significantly lower once the new crop acres emerge.

Let’s look at the USDA report from Friday.  The USDA reduced the bean yield by 0.5 bpa down to 51.6 bpa which lowered the final bean production number by 56 M bu down to 4.544 B bu.  The USDA also increased beans used for crush by 10 M bu, but lowered bean exports by 25 M bu down to 1.875 B bu.  With the lack of Chinese bean buying, the bean export number is still vastly overstated, and I can see bean exports being trimmed by at least another 100 M bu by the end of the crop year.  When the dust settled, the final bean carryout was trimmed by 45 M bu down to 910 M bu.  Yes, the bean carryout was reduced, but we are still looking at over 900 M bu which is a huge number!  To give you some historical background, the US bean carryout has never been over 1.0 B bu.  Going back to 1975, the biggest bean carryout prior to this year was in 2007 when final bean carry out was only 573 M bu.  Our current bean carryout is almost double this and looks to grow once exports come down.

If you do not like the basis, sell beans on an HTA contract and set basis later. However, the posted basis today could very well be the best basis of the year, only to widen out considerably as we get closer to harvest.  If you plan on growing soybeans on your farm this summer, and if you don’t have them sold yet, I strongly suggest you do this now.  I have no problem getting at least 50% of these beans protected in some way.  If you don’t like the cash price, and you don’t want to sell beans on an HTA, another option is to use our cash plus contract where you can generate an additional 25 cents today in exchange for a new crop offer.  Please see below for more details.  This is a great tool, and many customers are using it.

If you would like to place a target to sell grain, you can either call us or place your own target on our Online Target Offer system.  It is easy, free, and an awesome way for you to protect your farm.  Please click here for more information.  If you would like to talk to one of our grain originators or make an appointment for one of them to meet with you on the farm, please click here.

Do You Want a Premium for your Beans?  Cash Plus Is The Answer

We are currently bidding $8.20 for cash beans and $8.70 for Oct / Nov ’19 beans delivered into Readfield.  If this level is still not enough to satisfy you cash flow demands, you should consider our Cash Plus Contract.  This contract will allow you to receive a 24 cent premium over the cash bid, and paid to you today.  In exchange for this premium, you will give us an offer to sell the same quantity of new crop November ’19 bean futures at the $9.90 level if on October 23rd 2019, the price of November soybean futures closes at or above the $9.90 level.  This is a win-win for you.  You will be paid a 24 cent premium now on your cash beans.  If on October 23rd , November bean futures close at or above $9.90, you will have the same quantity of beans sold at $9.90 futures, less the basis of 90 cents under November (this could vary slightly), equals a new crop bean contract at $9.00 for Oct / Nov ’19 delivery into Readfield or Center Valley.  This is a good price considering our posted new crop bean bid is $8.70 and represents a 30 cent premium over our posted new crop bid.  If on Oct 23rd , November bean futures close lower than $9.90, then you keep your 24 cent cash premium, and have no other obligation.  This contract has been popular as of late, and if you still own old beans, you should seriously consider it.

Recommendations For Corn & Bean Meal Consumers (Livestock Producers)

The bean market has ramped up yesterday with the China enthusiasm, and this has pushed bean meal higher as well.  Corn futures ramped higher yesterday, and corn basis is firming.  At some point, this enthusiasm will cool and the marker will reset lower.  This will be the time for you to lock in corn and bean meal for your livestock.  Here are my recommendations for coverage.  To see where futures are currently trading, please click here.

Cash Corn – March 19 Corn Futures – Support at $3.67, Resistance at $3.88, Place Targets at $3.71

Cash Bean Meal – March 19 Meal Futures – Support at $303, Resistance at $325, Place Targets at $308

Sign Up NOW For New Average Price Contracts

We are again offering an average price contract this year for new crop delivery.  The new crop contract will be for corn or beans for Oct / Nov ’18 delivery into any of our facilities.  The contract is a cash contract and will use a 10 week period to average the price.  The timing of the new crop contract will be May 1st through July 3rd.  We will simply average the closing prices each Wednesday during these periods, pricing 1/10 of your contracted bushels each week during the period.  At the end of the period, we will simply average the prices together.  There is no minimum quantity and the best part of these contracts are that they are FREE.  There are no fees associated with these averaging contracts. 

The dates associated with the new crop pricing period of May 1st through July 3rd  is normally a very good time to sell new crop grain because the market is dealing with planting problems and then dealing with dry weather problems somewhere in the Corn Belt.  When problems surface, the market puts more risk premium in the futures, and you will be participating in the market to capture these premiums.  If there are no problems, the market usually drifts lower after the July 4th holiday, making the timing an excellent part of this new crop average contract.    These contracts are simple, easy to understand, and they work.  Every farmer should put a decent amount of grain into these contracts to help protect your farm.  For more information on these exciting new contracts, please click here.

What Are The Charts Telling Us?  Recommendations For Grain Producers.

Here are the support and resistance levels for cash and new crop grains.  These are all futures levels as traded at Chicago:

Cash Corn – Mar 19 Corn Futures – Support at $3.67, Resistance at $3.88, Place Targets at $3.83

New Corn – Dec 19 Corn Futures – Support at $3.91, Resistance at $4.08, Place Targets at $4.03

Cash Beans – Mar 19 Bean Futures – Support at $8.80, Resistance at $9.41, Place Targets at $9.31

New Beans – Nov 19 Bean Futures – Support at $9.23, Resistance at $9.71, Place Targets at $9.65

New Wheat – July 19 Wheat Futures – Support at $5.17, Resistance at $5.50, Place Targets at $5.40

To see where grain futures are currently trading, please click here.

February Results For CHS ProAdvantage Contracts

For those of you who have placed bushels in the CHS ProAdvantage program, we have the updated pricing results for February.  Again, ProAdvantage is our fully managed contracts that we offered during December for patrons who wanted a completely “hands off” approach to grain marketing.  You simply gave the trading professionals at CHS a portion of your production for next harvest, and they take care of the rest.  Behind the scenes they are aggressively buying and selling complex futures and options positions to generate as much profit as possible on your bushels by the end of the program.  The goal is to give you the highest possible futures price at the end of the program as possible by using trading techniques and options that typically are not available to the individual farmer.  The signup period is obviously over.  However, we can see each month how they are progressing, and look at their current values as they trade through the period.  We can also see the percentage of the crop they have sold, which gives you a clue to how bullish or bearish they are.  For those of you enrolled in the program, and you did not receive the results yet, here they are.  This is an interesting read.  Don’t worry if you don’t completely understand all of the information.  If you have any questions about anything, and you want help, please call me and I will explain it to you.  Please click here to see the Feb results.

As always, if I can help you with anything, please call me at the main office in New London at 419-279-3809 or send me an email at marcus.cordonnier@chsinc.com.

Marcus Cordonnier

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