×
×
homepage logo

BRIAN HOOPS

By Staff | Nov 27, 2015

ICE’s latest

Intercontinental Exchange Inc., the owner of the New York Stock Exchange, said it would buy commodities trading platform Trayport from BGC Partners Inc. and GFI Group Inc. for about $650 million in stock.

ICE said the deal would help it to provide new services to the European over-the-counter energy markets, including power, natural gas and coal.

The exchange and clearing house operator said it also planned to extend the platform to cater to over-the-counter energy markets in Asia.

GFI will receive 2.5 million ICE shares as part of the deal. ICE may substitute cash for part or all of the stock consideration, BGC said in a statement.

ICE, which began as an energy exchange in 2000 and expanded through acquisitions of companies including the New York Board of Trade, said the deal would not have a material impact on its 2016 earnings.

FSA’s planted acres

The Farm Service Agency’s update on planted acres puts corn acres now at 84.8 million, with prevented plant acres at almost 2.4 million acres.

Soybean planted area totals 81.1 million acres, with 2.2 million prevented plant.

All wheat acres are put at 51.5 million, with prevented plant acres at just under 700,000.

Informa Economics has released its forecast for 2016, estimating corn acreage at 90.1 million acres; soybeans at 85.3 million and winter wheat at 38.7 million acres.

Beef herd growing

The U.S. is on track for increasing the national beef cattle herd inventory.

Canada seems to be more of a mixed bag. Canadian cow slaughter, through October, is 14 percent below 2014 (down 58,000 head).

If this trend holds it could indicate slight year-over-year growth in Canadian cattle numbers.

This is important to the U.S. because in 2014 Canada was the fourth largest importer of U.S. beef behind Japan, Hong Kong and Mexico, at 364 million pounds.

Even with a softer export market for U.S. beef this year, Canada continues to be an important trading partner.

CORN ANALYSIS

Corn closed the week 5.25 cents higher.

Last week, private exporters reported sales of 1.44 million metric tons of corn to Mexico.

Weekly export sales showed corn sales were 30.7 million bushels for corn.

Annual sales are 572.5 mb, or 29 percent slower than last year’s pace.

Prices are hovering near contract lows as there is little incentive for end users to be aggressive. Buyers and funds are unwilling to step in and buy purchase prices.

There is a seasonal tendency for prices to work higher as farmers normally are unwilling sellers until after the first of the year.

This typically creates tighter basis and a small futures rally. Without better export demand and any weather problems or threats, the rally looks to be limited.

Producers storing grain should look to use the rally to make sales of the product or options to be rewarded with a storage hedge.

Strategy and outlook: Producers should use a rally into the end of the year to make additional sales or wait until a weather scare in the summer months.

SOYBEANS ANALYSIS

Soybeans closed the week 1.5 cents higher.

Last week, private exporters announced sales of 180,000 mt of soybeans to China and 120,000 mt of soybeans to an unknown destination.

Weekly export sales of new crop soybeans were 66 mb. The export pace of the 2015/16 marketing year now stands at 1.135 billion bushels, or down 16 percent mb from last year’s pace.

The monthly NOPA crush report was released last week with a new record set for the month of October, but was a disappointment to the trade as it came in below expectations.

The October crush was 158.895 mb, below estimates of 161 mb, but still was the largest October crush on record, beating the previous record of 157.96 mb in 2014.

Crush rebounded from last month’s 126.7 mb last month as crushers purchased the plentiful new crop supplies during harvest.

Prices are hovering just above key weekly support. This area needs to hold, otherwise sell stops no doubt rest below this level and once triggered, prices look to move sharply lower.

Strategy and outlook: Producers should use a rally into the end of the year to make additional sales or wait until a weather scare in the summer months.

Do not store unprotected soybeans.

This material has been prepared by a sales or trading employee or agent of Midwest Market Solutions and is, or is in the nature of a solicitation. Brian Hoops can be reached at (605) 660-1155.

Please Enter Your Facebook App ID. Required for FB Comments. Click here for FB Comments Settings page