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Midday Update



Midday Update

·         The death-watch continues on Greece as its parliament debates necessary reforms for getting the aid it needs to stay within the Eurozone.

·         The dollar surged and remains strong this morning after producer price index data showed that inflation pressures are stronger than expected at the wholesale level, suggesting the need for higher interest rates. Furthermore, Fed Chair Janet Yellen testified that the Fed is still on schedule for raising rates later this year. The stronger dollar precipitated money flowing out of the broader commodity sector, making a recovery in corn prices more difficult and amplifying losses in the soybean and wheat market.

·         The Department of Energy reports that crude oil stocks declined by 4.3 million to 461.4 million barrels in the week ending July 10. However, stocks remain near the highest seen this time of year for the past 80  years. Gasoline stocks are in the upper end of the average range for this time of year, while distillate stocks (includes diesel) are near the middle of the range.

·         Ethanol stocks slipped to 19.7 million barrels in the week ending July 10, down from 19.8 million the previous week, but up from 17.9 million barrels in the same week last year. Ethanol production slipped to 984K barrels per day during the week, down from 987K barrels the previous week, up from 943K barrels per day in the same week last year, but just below the record of 994K barrels per day set three weeks prior.

·         The National Oilseed Processors Association reports that its members crushed 142.473 million bushels of soybeans in June, down from 148.4 million the previous month, but up from 118.7 million the previous year and yet another record for the month. The trade was looking for crush of 141.478 million bushels, while we were looking for 141.9 million bushels.

·         Corn futures are mixed this morning, trying to find firm footing, but fighting negative money flow from the outside markets, as well as good crop ratings from USDA.

·         Soybean futures are down 12 to 13 cents on good crop ratings and a sense that August is the month that matters.

·         Wheat futures are down 8 cents in Chicago, down 6 cents in KC and down 5 cents in MN on abundant global supplies at cheaper prices than seen here in the United States, with added pressure from a strong dollar.

·         Live cattle futures are 10 to 40 cents higher near-term, as prices consolidate on recent losses. There are reports of packers offering just $144 in the Plains.

·         Feeder cattle are up $1 to $1.50 on strength in the cash market and recent weakness in corn.

·         Lean hog futures are quietly mixed in consolidation. The cash market is mostly steady to firm, with product prices firmer as well.



All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.




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Arlan Suderman | Senior Market Analyst
WATER STREET ADVISORY® | www.waterstreet.org
(316) 729-4599 | asuderman@waterstreet.org

Past performance is not indicative of future results. The information contained in this report is intended for informational purposes only and is the opinion of the writer and may change at any time. This information was compiled from sources believed to be reliable but accuracy cannot be and is not guaranteed. There is no warranty, expressed or implied, in regards to this information for any particular purpose. There is SIGNIFICANT RISK involved in trading futures and or options on futures and may not be suitable for all investors. Investors should consider these RISKS and evaluate their suitability based on their financial conditions. No one should ever consider trading futures or options on futures with anything other than RISK CAPITAL. This information is provided freely and is NOT in the capacity of a trading advisor. NO LIABILITY on the part of the author exists for any trading loss you may incur in the use of this information. Information provided is not to be construed as an offer to sell or solicitation to buy any commodity or security named herein.

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