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Calls - Aug. 26, 2008

Calls
Soybeans: 25-30 Lower
SoyMeal: 7.00-9.00 Lower
SoyOil: 100-125 Lower
Corn: 8-10 Lower
Wheat: 20-30 Lower
 
Calls: Mostly lower as traders a bit confused on what to focus on – weather still appears on the supportive side – meanwhile it’s the ongoing rally in the USDlr that has caused weakness overnight in addition to very weak markets in Malaysia and China – early weakness to crude oil and metal values – metals values remain lower – crude oil values are now trading mostly higher on Russian concerns and hurricane Gustav (see below for details).
Corn conditions declined 3% to 64% g/e and soybeans went down 1% to 61% g/e. Spring wheat ratings were mostly steady in the latest week, though harvest continues to lag, with 61% of the crop cut, compared to 72% on average. Good progress was made last week, however.

Malaysian palm oil ended 191 ringgets lower – following weakness to crude oil and soyoil in addition to concerns over weak Malaysian palm oil exports data that showed very weak shipments for the August 1-25 timeframe – along with ideas of a higher production cycle expected thru the end of October.

China Dalian futures ended mostly lower with soybeans dn CNY35, soyoil dn CNY290 and corn up CNY1. Soyoil did fall to limit losses on rumors that China would cut its veg oil import tax which led to ideas of increased imports.

US Weather: Showers and storms were noted in the Delta and the SE US overnight with rainfall totals ranging from .25-1.25. Much of the moisture was from the remnants of Fay. The remainder of the Midwest was dry with seasonal temperatures. Gustav formed into a hurricane overnight. The storm is expected to pass into the gulf in the next few days as a category 3 hurricane. The rapid intensification of the storm is worrisome with one forecast model tracking the system across the key natural gas and crude oil platforms. This storm has to be carefully monitored since it offers a real threat to the US energy sector. The EU and US models remain in good agreement for the next 10 days. A much drier and warmer than normal weather forecast is expected for the Midwest into September 7th. The US and EU weather models have both reduced the chances of rain with a passing cold front on Thursday/Friday. This system now looks to produce .25-.75 of rain over the Lake States of MN, WI and MI with totals elsewhere being mostly less then .25. The forecast is then dry through the long holiday weekend with a few lite showers possible during the last half of next week. It is still too far to forecast exact rain amounts but it appears totals could be in the .1-.5 inch range.

Showers are beginning to move into Western Australia, and are forecast to bring moisture to the rest of the continent’s wheat fields this week. Rain is also expected in Argentina, giving a boost to dry fields there.

Crude oil about $1.00 Higher - Gold dn about $4.00 – USDlr sharply higher.

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Posted at 06:29AM Aug 26, 2008 by MarketReports admin in Asia Closing  |