Craig’s Closing Comments

September 21, 2015

It has been said that change is the only constant in life. As I sit down to put the closing comments together this afternoon,  I find myself reflecting on that statement—perhaps because I am entering a season of change. I can’t begin to express how blessed I have been to work for NCFE, a cooperative that embraces the commitment to serving our patrons with the same fervor that I possess. I believe that it is this commitment between yourselves and NCFE that will allow us both to get through the current low price environment, and thrive well into the future. I have loved getting to know and work with the employees and patrons of NCFE. It has truly been one of the highlights of my career.

With that in mind, I find it very hard to leave, but I have been offered an opportunity that I just couldn’t pass up. So this will be my last week with NCFE.  After having spent the bulk of my life in Minnesota and South Dakota, I find myself heading to the Eastern Corn Belt and a position within a cooperative in Ohio. While my heart remains in South Dakota, I will be a Buckeye for the foreseeable future and look forward to introducing those fine folks to my slow cousin Jimmy. 

Before I do that, I want to take this last opportunity to thank you once again for the privilege of working with you these past years, and leave you with this Irish blessing:

May you always have work for your hands to do.

May your pockets hold always a coin or two.

May the sun shine bright on your windowpane.

May the rainbow be certain to follow each rain.

May the hand of a friend always be near you.

And may God fill your heart with gladness to cheer you.  

Craig’s Closing Comments

Craig’s Closing Comments

September 17, 2015

Perhaps the biggest news of the day came after the markets were closed.  The Federal Open Market Committee decided to kick the can down the road once again as if left the Fed funds rate unchanged at near zero.  Analysts are telling me that the announcement is bullish for stock index futures and is bearish for the USA dollar.  On its face this would seem to mean that the USA dollar has topped out and should be bullish for commodities.  While that is the conventional wisdom it was interesting to see the action in the DOW futures after the announcement.  As expected the market shot up but then tuned and started trading lower so perhaps things don’t always pan out like the exports expect them to.  The following chart is a 5 minute bar chart of the spot mini DOW futures contract which shows the initial rally and subsequent sell-off.

Craig’s Closing Comments

Craig’s Closing Comments

Craig’s Closing Comments

September 10, 2015

I continue to believe that outside markets could exert a great deal of influence on the commodity markets. Today the news from the Asian markets was not good.  We had poor economic data out of China and Japan overnight.  China’s PPI in August was down nearly 6% when a decline of 5.5% was expected.  Japan’s machinery orders were down 3.6% month over month when an increase of 3.7% was anticipated.  We need good economic news from our trading partners and really haven’t been getting it. 

Craig’s Closing Comments

September 9, 2015

I find it interesting that on this date in 1776 the Continental Congress formally declares the name of the new nation to be the “United States” of America. This replaced the term “United Colonies,” which had been in general use.  I am not all that sure that United applies to this nation anymore and I darn sure know I would trade the pack of clowns in Washington D.C. for men of the caliber that made up the Continental Congress in half a heartbeat.  Well, before I become politically incorrect I better move on to the markets. 

Corn:

Watching the corn market today was about like watching paint dry as we had a boring session in a tight trading range although we did manage to close a bit higher for the day.

Heading into Friday’s USDA report the average trade guess is that we will have a national average yield of 167.6 bu/acre and total production of 13.599 billion bushels.  In August the numbers were 168.8 bu acre with total production at 13.686 billion bushels.

World carryover for corn is expected to be at 193.5 MMT, down a touch from last month’s 195.1 MMT.

The bottom line is that fall is in the air and traders have visions of huge piles of corn dancing in their heads.  The conventional wisdom also seems to be that you will hold on to as much of the corn as possible which could create an interesting basis environment.

At the current time two of my three technical indicators are bullish the December corn futures. 

Craig’s Closing Comments

September 8, 2015

Corn:

Strong outside markets and a weak dollar helped boost commodity prices today.

The weekly export inspections came in at 35.2 million bushels.  The new crop year is just getting under way and we will need to average 35.5 million bushels per week to hit the USDA projection.  It is worth noting that with the ethanol market not expecting any significant growth we need good exports to move the excess out of the market.  The problem is that other exporting countries are in the same boat and have been doing a better job of capturing that market.  The following chart does a good job of illustrating what has been happening in the export market. 

Craig’s Closing Comments

Lynn Miller

September 4th, 2015

I had a quote pop up on my facebook feed that seemed appropriate for the market atmosphere we are trading now and I think it pretty much sums up how many are feeling right now; “The market can stay irrational longer than I can stay solvent.” 

There just is no new news out there to trade.  Last week we traded the Chinese currency devaluation, this week its hot/dry weather and next week --- well who knows.
What will be on everyone’s mind Tuesday is the crop conditions report.  It is thought to be bullish after a hot dry week and in front of a potentially bullish tone to the USDA’s Supply and Demand report on Friday.  These two things alone could give us the most positive things to trade we have seen in quite a while.  If you have thought about placing targets – this might be the time to let them work for you.

Have a safe Labor Day Holiday Everyone.

Craig’s Closing Comments

Craig Haugaard

September 3, 2015

Corn:

Weekly export sales came in at 4.4 million bushels which was below the low end of the range of trade guesses and from there on out this market struggled today.  At 10:30 this morning the new Informa numbers came out in which they pegged the national average yield at 168.8 bu/acre with a total production number of 13.688 billion bushels.  That led to some aggressive selling and when the smoke cleared the funds had sold 8,000 contracts and we closed down six cents for the session.