Markets Beginning 2015

[charliep]

any thoughts about the markets beginning 2015.

My two bits.

Crop futures markets basically are holding a trading range.

A surprise for me is CBT corn above $4/bu and soybeans above $10/bu.

An inverse in ICE futures Canada canola prices. The inverse is taken out of the cash market via basis but does create some interesting opportunities.

[boarderbloke]

charliep,,, " The inverse is taken out of the cash market via basis but does create some interesting opportunities."

charliep, is this not just the "market place", telling grainco's that they're wrong, by charging such a high basis for cash or nearby canola deliveries? The "market place" is not getting the canola seed it desires because of the widened basis grainco's are charging(even though the futures have risen), which inturn discourages nearby or cash selling of canola seed. Canola futures are raising inversely because the market place is demanding canola seed deliveries now, but grainco's are choosing to pocket most of the rise in price, just like they're are doing with wheats.

If deliveries are desired in weather like this, either basis charges will have to be slashed or a major rise in nearby futures will have to happen(without being consumed by basis increases),,, they should all remember, the crop wasn't all that big.

[farming101]

Translation:
Futures market is telling producer to sell, basis is saying no thanks, talk to us in April when the weight restrictions are on the roads.

[fjlip]

That's about it,101! Grains all green this morn, EXCEPT crude down 4% the most of all.

[boarderbloke]

farming101, I think more precisely,,, Grain futures rise in price, grainco's say thankyou very much!

[furrowtickler]

Sooner or later they will have to fill the rail cars. Happened to NWT in Mid Dec. They fuked around for too long then got caught with trains coming and the bunk house empty. Equated to a 60 basis in a hurry.

[charliep]

I recognize what you guys are saying but are there any strategies coming out of these markets.

Hustle for good basis in the nearby cash market and sell. Replace with futures/options in a further out month.

Watch the spreads in futures. Is the inverse likely to hold or at some point move to carry?

Watch for good basis in deferred months and lock in.

If your target price is $10/bu, deferred delivery contracts are pretty close these days.

[ado089]

March to July is $10. Basis at Cargill is $12 for both. The $50,000 question is will the basis improve $10 over the next 6 months???

[bigzee]

Best basis in my area -15, tempted to lock it in before it goes the other way. With the rally so far today $10 could be a possibility later this wk.
if that happens market will get flooded prices will erode.

[ado089]

Every GPO in the country must be getting hit today. March keeps bouncing off 450 every 20 minutes.