Play Turner’s Take Podcast Episode 182

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We have had some email issues with Turner’s Take. They should be fixed now but if you have not been receiving this email it is because we had to switch something on our back end servers.  It should be fixed now. In this podcast we go over why I am now very pessimistic about a US-China deal and why the May WASDE report may be more bearish than expected.  The US-China deal is could drag out for a very long time if this is all about IP and Technology Transfer, which I think it is.  China needs to change laws and their political/economic system to meet the demands from the Trump Administration. At this point I can see both sides walking away, tariffs raised, and the US government offer support payments for soybeans again and maybe a more significant assistance with corn (not just 1 cent).

I also see the WASDE as bearish on Wednesday.  Below are my estimates for New Crop.  The columns highlighted in yellow is what I think the USDA will publish on Friday. The other columns are different scenarios based on how acres and yield may change for corn and soybeans

Corn Supply & Demand

The highlighted area on the right is my new crop corn estimates. The USDA is going to have a 92.9mm acre and 176 yield.  I think my numbers might not be bearish enough as we could add to old crop stocks if ethanol usage and exports leak lower (increasing old crop stocks to 2.1 billion?).  Then if the USDA adjusts new crop export lower to account for the large South American corn crop we could have new crop carryout be 2.4 billion or higher.  Not good!

I am buying short dated puts ahead of this report.  I’ll be making phone calls tomorrow and I will send something out in Turner’s Take Ag Marketing.  On Friday we could have both a bearish USDA report and no deal with China.  I know there are weather issues with planting but the trade is going to treat the WASDE as gospel.

Soybeans Supply & Demand

The yellow column is my estimates for the WASDE on Friday.  Just like corn, it is bearish.  If the new crop stock are over 1 billion and we don’t get a US-China deal, I am concerned soybeans can make new lows.  Old crop could trade sub $8.  Soybeans are the most bearish of the grains and Meal is the most bearish of the Oilseed complex.  I will be buying short dated Meal puts ahead of the report. I will be calling farmers tomorrow and sending an email through 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!

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.