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Corn, Wheat Futures See Modestly Bearish Reactions to USDA Report

Corn, Wheat Futures See Modestly Bearish Reactions to USDA Report

13 June 2013
Jim Wyckoff Commentary -  TheCropSite

ANALYSIS - Corn and wheat futures were moderately lower in the wake of the latest US Department of Agriculture monthly supply and demand report issued late Wednesday morning, writes Jim Wyckoff for TheCropSite.

Soybeans were trading moderately higher in the report’s aftermath. The USDA data was deemed by traders as neutral to bearish for corn and wheat, and neutral for soybeans.

While the government reduced by 1% the average U.S. corn yield, to 156.5 bushels per acre, it left its estimate for total U.S. planted corn acres unchanged. Many felt the government would reduce planted corn acres in this report, but now reckon USDA will reduce its planted acreage figure for U.S. corn in late late-June plantings update.

Total corn stocks at the end of the 2014 marketing year were pegged at 1.949 billion bushels, which was larger than the consensus forecast and putting some downside price pressure on corn futures. USDA now puts the U.S. average on-farm cash corn price at $4.40 to $5.20 a bushel, up 10 cents on both ends of the range from May.

Wheat futures were under some selling pressure in the immediate aftermath of the USDA data Wednesday, as the US Agriculture Department estimated domestic wheat supplies at higher levels than its last report in May. However, losses in wheat were pared as traders saw the world supply and demand balance for wheat was tightened up a bit in this USDA report due to some adverse growing weather in Ukraine and Russia.

USDA now puts the U.S. average on-farm cash wheat price at $6.25 to $7.55 a bushel, up 10 cents on both ends of the range from May.

There were no significant changes by USDA this month to the soybean supply and demand balance sheet. USDA puts the US average on-farm cash soybean price at $9.75 to $11.75 a bushel, up 25 cents on both ends of the range from May.

TheCropSite News Desk

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%): 1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.



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