Market forecaster for April 30
STRATEGY & OUTLOOK
Producers should have 80 percent of 2011/12 crop production sold. New crop sales should begin at $6.05 with a 20 percent sale. Producers own the December 5.40 strike puts on 50 percent of production. If inclined, sell the December 7.00 strike calls to help pay for the cost of the puts.
SOYBEANS - ANALYSIS - Soybeans closed the week 50 cents higher from last week. Last week, private exporters reported sales of 281,000 mts of US soybeans to an unknown destination and 110,000 mts of soybeans to China.
In the weekly export sales report, soybean sales were 51.7 mb vs. 4.7 mb needed to reach the USDA forecast of 1.290 bb. Soybean planting progress is at 6 percent completed vs. 2 percent on average. Technically, soybeans and meal traded and closed above major weekly resistance levels and at the highest levels since 2008. This technical breakout should attract additional speculative buying while commercials are selling against the rally. Very heavy commercial selling will eventually be bearish for prices. Once the technical trend breaks, prices will retreat exceptionally fast as the large funds unwind long positions.
STRATEGY & OUTLOOK
Producers are now sold at 100 percent of the 2011/12 crop and are 30 percent sold of the 2012/13 production. Producers bought the November 1360 put options when November rallied to $13.95 on 50 percent of the 2012/13 production. If inclined, sell the 1600 calls to cheapen the cost of the puts.
WHEAT - ANALYSIS - For the week, Chicago wheat closed 26 1/2 cents higher; Kansas City wheat 20 1/2 cents higher and Minneapolis wheat 19 cents lower. Last week, Japan purchased 139,000 mts of milling wheat from the US, Canada and Australia.
In the weekly export sales report, wheat sales were 27.3 mb vs. 3.0 mb needed to reach the USDA forecast of 1,000 mb. Spring wheat planting progress is now at 57 percent, well above the average pace of 19 percent. Winter wheat conditions lost 1 percent to 63 percent g/e compared to last week, but it is well above the 36 percent g/e rating last year and the 2nd highest in the last 5 years. Stats Canada pegged intentions to plant at 24.324 million acres of wheat. This is 13 percent larger than last year. Durum acres are expected to increase 27 percent from last year to 5.1 million. Spring wheat acres are pegged at 17.178 million up 1.4 million from a year ago.