Play Turner’s Take Podcast Episode 171

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

The February 2019 WASDE is tomorrow and it is a combination of the January and February reports.  We will see Quarterly and Annual Stocks and Winter Wheat Seedings.  This has the potential to be a volatile report for the grain and oilseed markets.  Make sure you take a listen to the latest Turner’s Take Podcast!

WASDE Expectations

Below are the industry guesses for US and Global Stocks.  The trade will be looking for corn under 1.7 billion and soybeans still above 900mm US old crop ending stocks.  World Ending Stocks are expected to be steady from the last Dec report.

The next set of data I will look at is US yields, Dec 1 Stocks, and Winter Wheat Seedings.  Corn and soybean yields are expected to be lower.  Soybean stocks should rise, and winter wheat acres should be lower.

Finally, we will look at South American production.  The number on this report that jumps out the most is Brazilian soybean production.  The USDA may say 120mm mt but the market thinks it is closer to 115mm mt.  We’ll see.  The USDA does not reduce production forecast as fast as the market does.

After the close tomorrow we will have an updated spreadsheet and podcast with our thoughts going forward.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Twitter: @Turners_Take

Contact Craig Turner

Play Turner’s Take Podcast Episode 171

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

The February 2019 WASDE is tomorrow and it is a combination of the January and February reports.  We will see Quarterly and Annual Stocks and Winter Wheat Seedings.  This has the potential to be a volatile report for the grain and oilseed markets.  Make sure you take a listen to the latest Turner’s Take Podcast!

WASDE Expectations

Below are the industry guesses for US and Global Stocks.  The trade will be looking for corn under 1.7 billion and soybeans still above 900mm US old crop ending stocks.  World Ending Stocks are expected to be steady from the last Dec report.

The next set of data I will look at is US yields, Dec 1 Stocks, and Winter Wheat Seedings.  Corn and soybean yields are expected to be lower.  Soybean stocks should rise, and winter wheat acres should be lower.

Finally, we will look at South American production.  The number on this report that jumps out the most is Brazilian soybean production.  The USDA may say 120mm mt but the market thinks it is closer to 115mm mt.  We’ll see.  The USDA does not reduce production forecast as fast as the market does.

After the close tomorrow we will have an updated spreadsheet and podcast with our thoughts going forward.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Twitter: @Turners_Take

Contact Craig Turner

Play Turner’s Take Podcast Episode 170

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

The US government is back open, we will have a WASDE report on Feb 8, and the US/China trade talks are back on.  South American weather is stabilizing, US new crop acreage estimates are coming in, and the USDA will start announcing export sales data starting tomorrow.  A lot is going on and you need to stay informed.  Make sure you take a listen to the latest Turner’s Take Podcast!

US/China Talks

The US and China are back at it today.  China will offer to buy $1 Trillion of US ag, energy, and manufacturing products over five years to close the trade gap.  The US will want China to respect IP and stop the transfer of technology from US to Chinese firms.  By the time the 90 day window expires, I think the best bet is the US and China agree to closing the trade gap, reduce the tariffs as a sign of good faith, and then continue negotiations into April and May as they continue to hammer out the IP issues and how China is going to open up their economy to the rest of the world.  I know there is only a month left in 90 day negotiations but it feels like we are only in the 4th inning with this trade deal.

I think the big winner could be US energy.  The US is expected to be a net exporter of energy by 2020.  With shale production ready and willing, and China’s economy growing at a 6% clip, this seems like a natural fit.  Take a look at the June vs Dec WTI spread.  The bear trend was established when crude went from the $70s to the $40s.  I think this uptrend reversal is due to OPEC cutting production and the market expecting China to buy more US crude to help make up the trade gap.  The spread is reversing/consolidating now.  A confirmation of big Chinese buying in US energy could take this spread from a carry to being inverted again.

June vs Dec Crude Oil

Feb 8th WASDE Report

The USDA announced the Feb 8th WASDE report will include all data from the Jan WASDE.  Historically the Feb 8 report is a snoozer.  So all this really means is the USDA is releasing the Jan WASDE in Feb.  We expect to see lower Winter Wheat acres.   We think corn yields come down a bit and export up a little, sending ending stock to about 1.6 billion.  Soybeans are a wild card but regardless of the number the world will be reminded how much US and Global stocks are on hand.

While I am bullish corn and wheat, my big concern is soybeans.  China will most likely only buy 5mm to 10mm mt of soybeans from the US.  This still leave old crop at 600mm bushels.  South America will have a lower production but it will still be a lot of soybeans.  There will be no shortages of soybeans as things stand.  Once the WASDE report comes out and we see large US and Global stocks, I think we could break the red trend line below.  I like have a short futures position or long some puts ahead of the Feb WASDE.

Continuous Soybeans

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing

Play Turner’s Take Podcast Episode 170

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

The US government is back open, we will have a WASDE report on Feb 8, and the US/China trade talks are back on.  South American weather is stabilizing, US new crop acreage estimates are coming in, and the USDA will start announcing export sales data starting tomorrow.  A lot is going on and you need to stay informed.  Make sure you take a listen to the latest Turner’s Take Podcast!

US/China Talks

The US and China are back at it today.  China will offer to buy $1 Trillion of US ag, energy, and manufacturing products over five years to close the trade gap.  The US will want China to respect IP and stop the transfer of technology from US to Chinese firms.  By the time the 90 day window expires, I think the best bet is the US and China agree to closing the trade gap, reduce the tariffs as a sign of good faith, and then continue negotiations into April and May as they continue to hammer out the IP issues and how China is going to open up their economy to the rest of the world.  I know there is only a month left in 90 day negotiations but it feels like we are only in the 4th inning with this trade deal.

I think the big winner could be US energy.  The US is expected to be a net exporter of energy by 2020.  With shale production ready and willing, and China’s economy growing at a 6% clip, this seems like a natural fit.  Take a look at the June vs Dec WTI spread.  The bear trend was established when crude went from the $70s to the $40s.  I think this uptrend reversal is due to OPEC cutting production and the market expecting China to buy more US crude to help make up the trade gap.  The spread is reversing/consolidating now.  A confirmation of big Chinese buying in US energy could take this spread from a carry to being inverted again.

June vs Dec Crude Oil

Feb 8th WASDE Report

The USDA announced the Feb 8th WASDE report will include all data from the Jan WASDE.  Historically the Feb 8 report is a snoozer.  So all this really means is the USDA is releasing the Jan WASDE in Feb.  We expect to see lower Winter Wheat acres.   We think corn yields come down a bit and export up a little, sending ending stock to about 1.6 billion.  Soybeans are a wild card but regardless of the number the world will be reminded how much US and Global stocks are on hand.

While I am bullish corn and wheat, my big concern is soybeans.  China will most likely only buy 5mm to 10mm mt of soybeans from the US.  This still leave old crop at 600mm bushels.  South America will have a lower production but it will still be a lot of soybeans.  There will be no shortages of soybeans as things stand.  Once the WASDE report comes out and we see large US and Global stocks, I think we could break the red trend line below.  I like have a short futures position or long some puts ahead of the Feb WASDE.

Continuous Soybeans

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing

Play Turner’s Take Podcast Episode 169

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

I am just getting back from talking at the Ag Risk Management event in Menomonie, WI and I fly out tonight to speak at the Farmland Partners Tenant Event in Denver.  On today’s podcast I go over the macro markets, spend a little time on grains, but then we get deep into the US/China trade war.  In my opinion, it can all be explained by Total Factor Productivity and how the US now sees China as their #1 rival globally when it comes to politics, economics, and the military.  Make sure you take a listen to Turner’s Take podcast!

New Crop Corn & Soybean Acres

Informa came out with estimated acres and pegged soybeans at 86.2mm and corn at 91.5mm.  Based on the conversations I’ve had with farmers since the new year I tend to agree with these numbers.  91.5mm acres and  178 trend line yield keeps corn under 2.0 billion carryout, which I think is neutral.  It can be bullish with more export demand and spring planting/summer weather issues.  86.2mm for soybeans with a 50 trend line yield puts new crop ending stocks around 600.  Not great.  That is already factoring in the 5mm mt of new Chinese demand.  However, if a US/China deal gets done and China buys another 5mm mt of old crop, then ending stocks for beans are between 450 and 500mm with a trend line yield.  That at least has some potential for soybeans to rally in the spring and summer with weather issues.  We could even see $10 for new crop under the right conditions.

I am only in the office 1 day this week so this newsletter is going to be short.  Take a listen to the podcast and we’ll be back to our regular schedule and newsletter next week.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Twitter: @Turners_Take

Contact Craig Turner

Play Turner’s Take Podcast Episode 169

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

I am just getting back from talking at the Ag Risk Management event in Menomonie, WI and I fly out tonight to speak at the Farmland Partners Tenant Event in Denver.  On today’s podcast I go over the macro markets, spend a little time on grains, but then we get deep into the US/China trade war.  In my opinion, it can all be explained by Total Factor Productivity and how the US now sees China as their #1 rival globally when it comes to politics, economics, and the military.  Make sure you take a listen to Turner’s Take podcast!

New Crop Corn & Soybean Acres

Informa came out with estimated acres and pegged soybeans at 86.2mm and corn at 91.5mm.  Based on the conversations I’ve had with farmers since the new year I tend to agree with these numbers.  91.5mm acres and  178 trend line yield keeps corn under 2.0 billion carryout, which I think is neutral.  It can be bullish with more export demand and spring planting/summer weather issues.  86.2mm for soybeans with a 50 trend line yield puts new crop ending stocks around 600.  Not great.  That is already factoring in the 5mm mt of new Chinese demand.  However, if a US/China deal gets done and China buys another 5mm mt of old crop, then ending stocks for beans are between 450 and 500mm with a trend line yield.  That at least has some potential for soybeans to rally in the spring and summer with weather issues.  We could even see $10 for new crop under the right conditions.

I am only in the office 1 day this week so this newsletter is going to be short.  Take a listen to the podcast and we’ll be back to our regular schedule and newsletter next week.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Twitter: @Turners_Take

Contact Craig Turner

Play Turner’s Take Podcast Episode 168

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

In this week’s podcast we go over our thoughts on the stock market and why it tends to have a bullish bias over time. We talk about the range bound nature in crude oil and why we might be seeing some “buy the rumor, sell the fact” in Natural Gas next week.  We dive into why cocoa and sugar might be bearish while coffee has more potential as a bull market.  Then we wrap up with why we need corn to gain on soybeans for new acres and what to look for in hogs and cattle.  Make sure you take a listen to Turner’s Take podcast!

Macro Markets

The US government continues the shutdown and we do not see an end in sight.  No CFTC CoT reports and no USDA reports.  The US/China trade delegation will not get back together until the end of January.  The big news today (and probably this week) is the Brexit vote today!   The vote is about 1pm Chicago time and all the traders will be waiting for the outcome.

Energy

We think the lows are in for crude oil, the market bias is higher, but we will still be in a trading range between $48 and $58 in the near term.  We wrote about short iron condors and short straddles in Turner’s Take Market Alert today.  I still like the bull futures spreads in crude. I don’t think the financial markets are crashing. I think the market has had to reprice assets based on lower than expected growth in 2019.  The market has done that. From here I think we trade in range with a bias to go higher.

The big story today for crude is the first cargoes are going to China from the US since the trade tariffs started.

We talked about Natural Gas last week forming a bottom and a cold weather spell away from trading higher into that gap. That happened faster than we thought!  Next week we some some potential for “buy the rumor/sell the fact” if the cold weather is foretasted for the end of January.  The forecasts will have to show colder temps for Feb too in order for the NG rally to continue.

Expected Crude Oil Range

Natural Gas

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Twitter:

Play Turner’s Take Podcast Episode 168

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

In this week’s podcast we go over our thoughts on the stock market and why it tends to have a bullish bias over time. We talk about the range bound nature in crude oil and why we might be seeing some “buy the rumor, sell the fact” in Natural Gas next week.  We dive into why cocoa and sugar might be bearish while coffee has more potential as a bull market.  Then we wrap up with why we need corn to gain on soybeans for new acres and what to look for in hogs and cattle.  Make sure you take a listen to Turner’s Take podcast!

Macro Markets

The US government continues the shutdown and we do not see an end in sight.  No CFTC CoT reports and no USDA reports.  The US/China trade delegation will not get back together until the end of January.  The big news today (and probably this week) is the Brexit vote today!   The vote is about 1pm Chicago time and all the traders will be waiting for the outcome.

Energy

We think the lows are in for crude oil, the market bias is higher, but we will still be in a trading range between $48 and $58 in the near term.  We wrote about short iron condors and short straddles in Turner’s Take Market Alert today.  I still like the bull futures spreads in crude. I don’t think the financial markets are crashing. I think the market has had to reprice assets based on lower than expected growth in 2019.  The market has done that. From here I think we trade in range with a bias to go higher.

The big story today for crude is the first cargoes are going to China from the US since the trade tariffs started.

We talked about Natural Gas last week forming a bottom and a cold weather spell away from trading higher into that gap. That happened faster than we thought!  Next week we some some potential for “buy the rumor/sell the fact” if the cold weather is foretasted for the end of January.  The forecasts will have to show colder temps for Feb too in order for the NG rally to continue.

Expected Crude Oil Range

Natural Gas

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

While the podcast does not have specific actionable trading recommendations, we do publish them in Turner’s Take Market Alert for spec traders and Turner’s Take Ag Marketing for hedgers. Want to know what to look for in the commodity futures markets? Take a listen to Turner’s Take podcast!

Craig Turner – Commodity Futures Broker

Turner’s Take Ag Marketing: https://www.turnerstakeag.com

Turner’s Take Spec: https://www.turnerstake.com

Play Turner’s Take Podcast Episode 167

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

We are now in the first full week of trading in 2019 and the markets are trading higher for the most part.  The US dollar is down and metals are struggling a bit, but the stock market, crude, grains, and livestock are generally higher.  We go over all the major futures market sectors and give our opinions for each in the latest episode!

Macro Markets

The US-China trade talks seem to be going well. The best article I’ve read about it recently is from the South China Morning Post.  This should be supportive for the markets as it is good for US growth, global growth, and US exports.  The US government shutdown is a bearish factor on the markets but many traders are shrugging it off. About 25% of the government is closed but many of the “essential” services are open.  Apparently the CFTC and the USDA are considered “non-essential”.

Natural Gas

March Natural Gas rallied to over $4.00 in Nov and Dec only to come back down to $2.80 support levels.  Winter has been unseasonably warm but we should have colder temperatures in Jan and Feb. The Cullen Outlook highlighted NG this week and I like getting NG long to oat these levels and that gap on the chart looks like a good target.

March Natural Gas

Coffee

Technically it looks like coffee double bottomed and then broke the red trend line.  Fundamentally Brazil and Vietnam are having some production issues and we may see global stock decline this year after years of gains.  I like coffee as long as we stay above the 99 level (blue line below).  A short covering rally combined with better demand and continued weather issues in Brazil has the potential to send coffee to 1.14 and then finally 1.26.

March Coffee

Corn

Below is my corn supply and demand table for old crop and new crop. This is part of my Turner’s Take Ag Marketing service.  Right now we have old crop at 1781mm bushels but I think it can be 1.6 to 1.7 billion when the USDA opens back up and releases the next WASDE.  That should be supportive of old crop.  Corn yield loss in South America has the potential to rally March Corn in the upper $3.80s or lower $3.90s.  At those levels we expect a lot of farm sales as old crop is plentiful in the country and farmers need to make sales.

The next three columns show projections for new crop corn.  The most bullish scenario we have right now is 91mm acres and a 175 yield.  The most bearish is 93mm acres and a 181 yield.  We do this to figure out a realistic price range for 2019 corn.  Traders and hedgers who want to get more in depth about this table and how we trade and hedge around these expectation should give us a call and we can talk about it.  As market conditions change I update the tables and the expected price ranges, so if you are a client at Daniels Trading you should get access to Turner’s Take Ag Marketing.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

Play Turner’s Take Podcast Episode 167

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

New Podcast!

We are now in the first full week of trading in 2019 and the markets are trading higher for the most part.  The US dollar is down and metals are struggling a bit, but the stock market, crude, grains, and livestock are generally higher.  We go over all the major futures market sectors and give our opinions for each in the latest episode!

Macro Markets

The US-China trade talks seem to be going well. The best article I’ve read about it recently is from the South China Morning Post.  This should be supportive for the markets as it is good for US growth, global growth, and US exports.  The US government shutdown is a bearish factor on the markets but many traders are shrugging it off. About 25% of the government is closed but many of the “essential” services are open.  Apparently the CFTC and the USDA are considered “non-essential”.

Natural Gas

March Natural Gas rallied to over $4.00 in Nov and Dec only to come back down to $2.80 support levels.  Winter has been unseasonably warm but we should have colder temperatures in Jan and Feb. The Cullen Outlook highlighted NG this week and I like getting NG long to oat these levels and that gap on the chart looks like a good target.

March Natural Gas

Coffee

Technically it looks like coffee double bottomed and then broke the red trend line.  Fundamentally Brazil and Vietnam are having some production issues and we may see global stock decline this year after years of gains.  I like coffee as long as we stay above the 99 level (blue line below).  A short covering rally combined with better demand and continued weather issues in Brazil has the potential to send coffee to 1.14 and then finally 1.26.

March Coffee

Corn

Below is my corn supply and demand table for old crop and new crop. This is part of my Turner’s Take Ag Marketing service.  Right now we have old crop at 1781mm bushels but I think it can be 1.6 to 1.7 billion when the USDA opens back up and releases the next WASDE.  That should be supportive of old crop.  Corn yield loss in South America has the potential to rally March Corn in the upper $3.80s or lower $3.90s.  At those levels we expect a lot of farm sales as old crop is plentiful in the country and farmers need to make sales.

The next three columns show projections for new crop corn.  The most bullish scenario we have right now is 91mm acres and a 175 yield.  The most bearish is 93mm acres and a 181 yield.  We do this to figure out a realistic price range for 2019 corn.  Traders and hedgers who want to get more in depth about this table and how we trade and hedge around these expectation should give us a call and we can talk about it.  As market conditions change I update the tables and the expected price ranges, so if you are a client at Daniels Trading you should get access to Turner’s Take Ag Marketing.

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!