From The Floor-An Afternoon Recap 11/10/15

News:

After bearish USDA report

  • Jan beans made new contract lows 8.50
  • Dec corn made new contract lows of 3.56
  • Soymeal futures fall to the lowest level since June
  • Chicago wheat futures fall more than 2%
  • Hard red winter wheat falls to lowest level since 2010
  • Minneapolis wheat falls to lowest level since 2010

Egypt GASC bought 115,000 tons of wheat for December shipment

  • 60,000 tons from Russia
  • 55,000 tons from Ukraine

Egypt GASC is in for wheat again tonight for December shipment

Reminder: Tomorrow is a holiday in the US. Veterans Day. US government and banks will be closed. US grain markets will be opened tomorrow.

Oil World expects global reserves of palm oil to tighten in 2016 , which should raise prices

Oil World said Russia and Ukraine farmers will leave 1.0-1.5 million hectares of winter crops unplanted due to dryness.

Oil World estimated Turkey’s ‘15/16 vegetable oil imports at a record high 1.5 MMT up 8% from ‘14/15

Australia’s east coast wheat crop likely only suffered quality downgrades on 1.0-1.5 million tons.

Global Grain Conference in Geneva

  • An analyst estimated Russia’s 2015 grain production at 94.5 MMT

UkrAgroConsult estimated Russia’s 2015 wheat crop at 60.0 MMT vs. previous estimate of 58.5 MMT

UkrAgroConsult estimated Russia’s ‘15/16 wheat exports at 21.5 MMT vs. ‘14/15 exports of 22.3 MMT

UkrAgoConsult estimated Russia’s 2015 total grain crop at 101.0 MMT vs. previous estimate of 99.5 MMT

UkrAgroConsult said 34% of Russia’s winter crops are in good condition vs. 56% a year ago

Russia plans to buy 2.0 million tons of grains for government reserves in ‘15/16

UkrAgroConsult said 29% of Ukraine’s winter grain crops are in good condition vs. 41% a year ago

UkrAgroConsult said 31% of Ukraine’s winter grain crops are in poor condition vs. 17% a year ago

UkrAgroConsult said Ukraine exported 903,200 tons of grain between Nov 1-9

Article on Reuters said Argentine grains output would be at least 30% higher by 2019 if presidential front runner Mauricio Macri wins this month’s election (November 22nd) and makes good on his word to cut export taxes and state controls that have weighed on production

  • Macri expected to end wheat and corn export quotas
  • Macri expected to scrap the 20-23% export taxes on wheat and corn
  • Macri expected to cut the current 35% export tax on soybeans by 5% in 2016 and then by 5% per year during a Macri government

IMEA said on Friday that 61% of Mato Grosso’s bean crop has been planted vs. 67% a week ago and vs. 83% average

A government official in Brazil said they will urge G20 to avoid raising subsidies to their food producers, that would curb prices and hurt poor countries and other exporters

  • G20 summit is November 15-16

Crop analysts said mild weather across western Europe has helped winter wheat crops get off to a good start .

UFOP estimated Germany’s 2016 winter rapeseed area at 1.339 million hectares vs. 1.284 million hectares a year ago

South Africa drought is the worse in 23 years

Chinese industry analysts –Weekly Chinese crush breakdown

  • For the week (Oct 31-Nov 6) total crush volume at 1,721,600 tons down .19% from a week ago
  • For the week (Oct 31-Nov 6) total crush capacity utilization at 54.76% down .11% from a week ago
  • Total ‘15/16 (Oct 1-Nov 6) crush volume at 8,262,250 tons up 18.28% from a year ago
  • Total 2015 (Jan 1-Nov 6) crush volume at 66,620,350 tons up 10.74% from a year ago  
  • As of Nov 6th total imported bean stocks at 5.6258 MMT down 1.31% from a week ago and up 29.08% from a year ago
  • Estimated November bean imports at 7.20 MMT
  • Estimated December bean imports at 7.80 MMT
  • Estimated January bean imports at 6.50 MMT
  • Estimated February bean imports at 5.0 MMT

Cordonnier’s weekly crop estimates

  • ‘15/16 Brazilian bean crop estimated at 100.0 MMT , unchanged from his previous estimate , but said bean crop estimate could be lowered
  • ‘15/16 Brazilian corn crop estimated at 81.2 MMT , unchanged from his previous estimate
  • ‘15/16 Argentina bean crop estimated at 58.0 MMT , unchanged from previous estimate
  • ‘15/16 Argentina corn crop estimated at 21.6 MMT , unchanged from previous estimate

Today was the third day Goldman Sachs / UBS roll. Roll ends on Thursday. They are rolling long December corn and wheat positions to March.

  • GS / UBS has already rolled their long December bean oil and soy meal positions to January during the November soybean roll.

Estimated fund activity:

  • Wheat sold 12,000
  • Corn sold 20,000
  • Beans sold 10,000
  • Meal sold 5,000
  • Bean oil sold 6,000

Upcoming reports/events:

  • Weekly API energy inventory report comes out today at 330 pm CST
  • Veteran’s Day in US tomorrow. US government and banks will be closed. US grain markets will be opened.
  • India’s markets will be closed Wednesday and Thursday for holiday
  • Malaysian markets were closed today for holiday, trading resumes tomorrow.
  • Malaysian Palm Oil Board comes out tomorrow with their October Malaysian palm oil data report. Based on a Reuters survey expecting

o   Palm oil stocks estimated at 2.72 MMT up 3.3% from September stocks

o   Palm oil output estimated at 1.93 MMT down 1.5% from September output

o   Palm oil exports estimated at 1.62 MMT down 3.5% from September exports

  • Surveyors SGS and Intertek come out tomorrow with their Malaysian Nov 1-10 palm oil export estimates
  • Weekly US jobless claims report comes out on Thursday at 730 am CST
  • Weekly US export sales report comes out on Friday at 730 am CST , due to US holiday
  • Weekly Nat Gas storage report will come out on Friday November 13 at 930 am CST, due to US holiday
  • Weekly DOE energy inventory report will come out Friday November 13 at 10 am CST , due to US holiday
  • Weekly US ethanol plant production report comes out on Friday November 13 at 10 am CST , due to US holiday
  • November beans and rice futures expire on Friday at noon CST
  • Weekly COT report comes out Friday at 230 pm CST
  • G20 summit in Antalya Turkey will take place on November 15-16

Option players:

  • TJM bought 2,000 March bean 760-780 put spreads at 2 ½ – 2 ¾
  • RJO bought 1,000 week 2 soybean 840 puts at 3-4
  • RJO bought 1,000 Dec soybean 840 puts at 6 ½
  • RJO sold 1,000 July soybean 920 calls at 24-24 ½
  • TJM bought 2,000 March bean 820 puts at 16 ½ -17 ½
  • RJO bought 500 May bean 800 puts and sold 500 May bean 960 calls at 2 1/8 – 2 ¼ debit
  • FI bought 500 Jan bean 870 puts at 23 5/8 -24 ¼
  • ABN sold 700 Jan bean 880 puts at 29 ½ -30 ¼ tied to Jan futures at 861 ½
  • Rand bought 700 Dec bean 840 puts at 4 ¼
  • RJO sold 11,000 Dec corn 340-310 put spreads at ½ – 5/8
  • RJO sold 5,000 Dec corn 350-350 put spreads at 2 1/8 -2 3/8
  • TJM bought 1,000 March corn 330-340 put spreads at 2 ¼
  • TJM sold 3,000 March corn 330-340-350-360 put condors at 1 7/8
  • Rand bought 1,250 March corn 350 puts at 7 tied to March futures at 375
  • RJO sold 1,000 Dec corn 370 puts at 8 5/8
  • Rosenthal sold 1,200 Dec corn 370-380 put spreads at 7 ½
  • ICAP sold 1,500 Jan corn 380 calls at 7 3/8 tied to March futures at 373 ½
  • FI bought 1,500 Dec corn 375 calls at 1 3/8
  • FI bought 500 May corn 350 puts at 9 ½
  • FI sold 500 May corn 400 calls at 14 5/8
  • EDF Mann bought 1,700 July wheat 620 calls at 10
  • RJO sold 1,000 Dec wheat 485 puts at 5 ¼ -5 ½
  • Rosenthal bought 500 Dec wheat 530 puts at 32-33
  • ICAP sold 500 Dec wheat 490 puts at 4 ¾ -5 ¾
  • Drax sold 400 March wheat 550 calls at 10 tied to March futures at 502
  • FI sold 500 Dec wheat 485 puts at 4 ¼
  • Rosenthal bought 1,700 Dec KC wheat 470-450 put spreads at 8-8 ¾
  • FI sold 500 Dec KC wheat 570 puts at 96
  • TJM bought 500 March meal 260-250 put spreads at 1.05
  • TJM bought 500 March meal 270 puts at 4.00
  • TJM sold 500 March meal 280 puts at 6.75-7.00
  • Rosenthal bought 300 week 2 soymeal 290 puts at 1.00-1.50
  • FI bought 1,000 Dec bean oil 28 calls at 17
  • FI bought 1,000 Dec bean oil 30 calls at 2
  • RJO sold 400 March bean oil 30-32 call spreads at 31 tied to March futures at 2800
  • RJO sold 1,200 May bean oil 31.50 calls at 50-52
  • JP Morgan sold 200 Jan bean oil 29.50 calls at 25

Closing vols and ATM straddles:

Corn:

Z15 360 10 / 10.50 21.00%

F16 370 19.25 / 20.25 19.00%

G16 370 27 / 28 20.50%

H16 370 32 / 32.75 20.75%

K16 380 43 / 44.50 21.50%

N16 380 52 / 53.50 22.00%

U16 380 63 / 64.50 23.50%

Z16 390 69 / 70.50 22.00%

Z17 400 86 / 90 19.75%

Beans:

Z15 860 18 / 20 17.00%

F16 860 37 / 39 15.75%

H16 860 59 / 61 16.75%

K16 860 74 / 76 16.25%

N16 860 89 / 91 16.50%

U16 860 102 / 106 17.00%

X16 860 111 / 116 17.00%

Wheat:

Z15 490 14 / 16 21.00%

F16 490 29 / 31 22.00%

H16 490 47.50 / 49 24.00%

K16 500 66 / 68 24.75%

N16 500 78.50 / 80 25.00%

KC Wheat:

Z15 460 13 / 15 22.50%

F16 470 26.50 / 28.50 21.00%

H16 470 44 / 46 23.00%

K16 480 60 / 62 24.00%

N16 490 73 / 75 24.25%

Minneapolis wheat:

Z15 495 13 / 15 19.00%

H16 510 40 / 45 20.00%

K16 520 58 / 62 22.00%

N16 530 72 / 76 23.00%

Meal:

Z15 295 7.0 / 8.0 18.50%

F16 290 14.0 / 15.0 17.50%

H16 290 22.0 / 23.0 18.50%

K16 290 27.5 / 28.5 18.00%

N16 290 33.0 / 34.0 18.50%

Q16 290 35.0 / 37.0 18.50%

U16 290 37.0 / 39.0 18.25%

V16 290 38.0 / 40.0 18.00%

Z16 290 40.0 / 42.0 17.50%

Bean oil:

Z15 27.5 70 / 90 21.00%

F16 27.5 150 / 170 21.00%

H16 28.0 230 / 250 20.75%

K16 28.0 300 / 330 20.75%

N16 28.0 350 / 380 21.00%

Q16 28.0 360 / 400 20.75%

U16 29.0 390 / 430 20.25%

V16 29.0 400 / 440 19.75%

Z16 29.0 440 / 480 19.75%

Crush quotes:

                Open                     Closes

Dec        77.5-80.5              76.0-80.0

JanDec 86.5-87.5              86.0-87.0

Jan         88.5-89.5              89.5-90.0

Mch       87.5-88.5              88.5-90.0

May       84.0-85.0              85.0-86.0

Jly           82.5-83.0              83.5-84.5

Aug        83.0-84.5              84.5-86.0

Sep        85.5-92.0              87.0-92.0

Oct         83.0-86.0              82.5-84.5

Dec6      85.5-87.0              85.0-86.5

Novsep  85.0-88.0              84.0-87.0

Data sources: Dow Jones , Bloomberg, Reuters , DTN news, barchart.com, CME Group and NYSE