The soy down yet again. The commentary here sounds like the same tune over again. The weather has been good here towards the end of the growing season. The conditions are hanging at a high level even with an advanced crop. Will the government add bushels as the pro farmer crop tour saw? Remains to be seen. A saying “big crops get bigger” comes to mind. The US and China have failed to come to any agreements that are supportive. The market has fallen quite a bit from its high. One friendly aspect at these levels could present themselves in the way of the export sales. There was a large sale made today in meal. It was listed as unknown. It is likely given the Arg currency situation and Brazil having supplied most beans of late to China, that they could still need to buy some US beans. In spite of the Tariffs. This could provide a rally. I say could because my long term outlook remains bearish and rallies to me present themselves as selling opportunities. My personal long term projections for beans are $777. For meal they are $268-$277.00. I have mentioned this before. I believe we will start to hear govt subsidy payments sooner rather than later. We are getting to levels that will be difficult to turn a profit if farms are rented or leveraged. In addition, with interest rates creeping high (a trend I think will continue), the cost of capital is a sincere consideration.
The corn a nothing day on the board. The dec was unchanged after a two sided trade. The fundamentals remain intact. It appears now that the Trump admin is close to making e15 a year long possibility. This has the potential to add more demand on an annualized basis. The demand story for corn continues to increase. The final yield from the USDA due the 12th of sept will certainly be important. A reduction from the current number could provide incentive to buyers. It is my suggestion to start a buying program if you are a user of corn and remain open without coverage. I favor being long dec futures and buying dec 345 puts. This is a simple way to define a strategy, with the costs and time frame known. Let’s see what happens overnight.
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” LANGUAGE IS THE HOUSE OF THE TRUTH OF BEING ” MARTIN HEIDEGGER
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