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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (17570)	1/10/2016 11:54:50 PM
From: John Pitera	4 Recommendations Recommended By 3bar Hawkmoon sixty2nds The Ox Read Replies (1) \| Respond to of 33421

Unwanted Piles of Corn, Soy Spur Most-Bearish Crop Outlook Ever January 10, 2016 — 3:00 PM CST Piles of unwanted grain on farms near Doug Schmitz’s storage bins in southern Minnesota are a stark reminder of just how bearish the outlook is for U.S. crop prices. After record yields during the harvest a few months ago, growers in the area still have 80 percent of their corn crop left to sell and 70 percent of soybeans, said Schmitz, who operates four grain elevators and markets to processors and exporters. Normally, half the supply would be unloaded by now, he said. While Schmitz Grain Inc. is under contract to collect 2 million bushels from local farmers, the outlook is so dim that *most of that inventory hasn’t been priced yet, he said. Money managers are holding their most-bearish bets on grain prices* since the government started tracking the data in 2006. It’s easy to see why. Stockpiles of corn and soybeans in the U.S., the world’s largest grower, probably were the biggest ever on Dec. 1, and wheat inventories were the highest in five years, according to a Bloomberg survey of analysts. The government will issue its estimate Tuesday. “It’s the slowest sales pace in the 25 years I’ve been in the grain business,” said Schmitz, who’s based in Currie, Minnesota. “It’s amazing how well farmers were able to put away those bushels and wait for a recovery in prices that has failed to come.” Full BinsHedge funds held a combined net-short position of 337,678 futures and options in corn, soybeans and wheat as of Jan. 5, 19 percent more than the previous week and more than twice what it was a month ago, according to Commodity Futures Trading Commission data released three days later. The bearish holdings were twice the short hedges held by commercial end-users, signaling farmers may be withholding crops that elevators would normally have already bought and hedged. All three commodities posted a third straight year of losses on the Chicago Board of Trade in 2015. Domestic stockpiles have been swelling as U.S. exports falter, fueled by a strong dollar and rising production by other suppliers. Schmitz said he has yet to load a single rail car this season with corn or soybeans destined for West Coast export terminals. A year earlier, he shipped 1 million bushels. The U.S. Department of Agriculture forecasts wheat exports in the current season *will be the lowest in four decades.* Corn and soybeans sold for delivery by Aug. 31 are down a combined 17 percent as of Dec. 31, surpassing the USDA’s estimates for a 6.6 percent annual decline. At the same time, corn shipments from Brazil were the highest ever in each of the past four months. Argentina’s exports have become more profitable after new president Mauricio Macri eliminated most crop taxes and lifted four years of currency controls. “It is a nearly unprecedented retention of crop inventory this year,” said Roger Fray, executive vice president for Ralston, Iowa-based West Central Cooperative, which can store about 78 million bushels of grain. “The producer has shoved corn and soybeans into places he has never used. It is very possible there will be some forced sales of grain this spring, when farmers need cash to plant crops.” Production RisksThe USDA will issue its World Agricultural Supply and Demand Estimates (WASDE) report at noon on Tuesday in Washington. The government probably will reduce its estimates of Brazil’s corn and soybean output as well as the forecast of Argentina’s corn production, according to the average estimate of analysts surveyed by Bloomberg. Parts of Brazil were hurt by lack of rain in December, according to Somar Meteorologia. Daily showers in northern crop areas will aid late growth through the next two weeks, Commodity Weather Group said on Jan. 8. Other U.S. weather risks remain. The current El Nino climate phenomenon has peaked, which may be replaced by a drier pattern known as La Nina in the second half of 2016, Australia’s Bureau of Meteorology said last week. November and December were the wettest since 1895 in the U.S., which could hurt corn and soybean yields later this year, according to T-Storm Weather LLC. “We need a market-clearing event, whether that’s a demand shock from somewhere or whether that’s a supply shock as a result of weather,” said Gillian Rutherford, who helps oversee about $13 billion as a commodities portfolio manager at Pacific Investment Management Co. in Newport Beach, California. “In the absence of that, we have such a material buffer that it’s difficult to envision a sustained price rally.” ---------- (editorial note by JP....... lots of deflationary pressure in the global system currently. )

To: Hawkmoon who wrote (17570)	2/9/2016 7:51:09 AM
From: John Pitera	2 Recommendations Recommended By 3bar Hawkmoon Read Replies (3) \| Respond to of 33421

Hawk, The YEN and EUR have developed very bullish charts. The YEN has major long term support at the 80 area... it has broken above it's 200 DMA, pulled back to it and now appears to be breaking out of the ascending triangle it's in...... additional notes on the chart. the EUR put in it's low back in March of 2015.... the SLOPE of thwhy e 200 DMA has changed from down to up for the first time in 3 plus years and it's been showing a proper rounding bottom and is now above it's 200 DMA. I commented last year that the big 3 Global Currencies were acting pretty stable... and now volatility in the 3 of them has picked up..... The Currencies drive Major Global asset class moves! JJP

To: Hawkmoon who wrote (17570)

4/7/2016 11:05:48 AM

From: John Pitera

4 Recommendations

Recommended By
Davy Crockett
Hawkmoon
roguedolphin
The Ox

Read Replies (2) | Respond to of 33421

The Yen continues on it's merry way higher.... Abenomic's and Japan is enigma nested inside of an anagram, inside a convexity paradox. What does happen to the yield convexity trade when rates are negative..... Beuller, Beuller, anyone, anyone.......

as I had pointed out back on February 8th.. and I have to thank you Hawk for asking the question if the $USD
was weakening what currencies are strengthening.... that got me looking at the Yen more closely

Message 30448123

the EUR/JPY key risk on - risk off remains in a defensive risk off posture.

and the yields in the Japanese 10 year government bonds go further into negative yield teritory as German
Bunds hover at a mer 10 basis points or so above zero. The German bund yield curve is currently in a
negative yield all the way out to 9 years on the curve.

The time cycles are indicating significant volatilitiy on April 18th and 19th and into the 20th. Some of these events may occur in Asia or mideast and thus it would be Sunday night April 17th. We could be seeing the Precious metals and the Grain complex making significant turns on April 18th... and potentially highs or lows for the year.

John

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To: Hawkmoon who wrote (17570)	2/9/2016 7:51:09 AM
From: John P	2 RecommendationsRecommended By 3bar Hawkmoon Read Replies (2) of 18098

Hawk, The YEN and EUR have developed very bullish charts. The YEN has major long term support at the 80 area... it has broken above it's 200 DMA, pulled back to it and now appears to be breaking out of the ascending triangle it's in...... additional notes on the chart. the EUR put in it's low back in March of 2015.... the SLOPE of thwhy e 200 DMA has changed from down to up for the first time in 3 plus years and it's been showing a proper rounding bottom and is now above it's 200 DMA. I commented last year that the big 3 Global Currencies were acting pretty stable... and now volatility in the 3 of them has picked up..... The Currencies drive Major Global asset class moves! JJP

John