Commentary:
SOY
The Argentinian strike continues. Approximately two weeks in at present. This is having an impact both real and perceived. The products both meal and oil continue to perform. The meal more related to the strike in my opinion. The strength here may continue until the strike is resolved. I have no insights or predictions related to this or the timing on a resolution. The meal could be the most at risk to a correction if the strike is resolved. The vegoil markets remain very well supported globally in general. This bodes well for soy oil. It is my opinion soy oil can remain well supported. It is also my thought that the bean oil relative to beans and meal in the long run can make gains. This is not necessarily the case today. However, the oil share could experience a move higher when meal weakens. Consider the bean oil spreads. The Jan July breaking out to new highs today. The meal spreads are performing as well. I don’t have an appetite to trade them though. The weather remains a key feature with Brazil receiving needed relief. The Argentinian weather remains too dry. Private analysts are reducing potential a bit. Also Paraguay looks to be a bit smaller this year as well. Look for the market to remain supported in general. A strike agreement could bring a quick correction. Caution advised.
CORN
The Corn market remains supported. The domestic fundamental picture has been friendly. The global picture remains supported based on weather issues in SA. In addition the Chinese feed grain needs are on the rise. It is my opinion that this is a shift that will last until at least next year. The Chinese needs will be paramount. It is a possibility that the Chinese growth in feed grain purchases could show a greater growth than in soy (My opinion). I am watching the July 21 Dec 21 corn spread. This is currently at 24 over. This is up from 12 over recently. If the Chinese needs are as great as some predict, the US will need to grow a large corn crop this next year. It is my thought corn and spreads will remain supported. As always quantify the risk.
Be Well
Trade Suggestion(s)
NA today
Risk/Reward
Futures-
Options –
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
800-993-5449
312-208-8836
[email protected]
www.walshtrading.com
Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.
Futures and options trading involves substantial risk and is not suitable for all investors. Therefore, individuals should carefully consider their financial condition in deciding whether to trade. Option traders should be aware that the exercise of a long option will result in a futures position. The valuation of futures and options may fluctuate, and as a result, clients may lose more than their original investment. The information contained on this site is the opinion of the writer or was obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in market prices. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
All information, communications, publications, and reports, including this specific material, used and distributed by Walsh Trading, Inc. (“WTI”) shall be construed as a solicitation for entering into a derivatives transaction. WTI does not distribute research reports, employ research analysts, or maintain a research department as defined in CFTC Regulation 1.71.