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In a world of electronic algorithm and high frequency traders, it is easy for us mouse clickers to feel left in the dust. Markets are able to respond to new information in milliseconds. “News” can be anything from a USDA report to a 280 character Tweet. Breaks and rallies on such news can last just seconds or less, and swings from one to the other can happen just as quickly. This makes having target orders in place in advance of these types of moves important to ensure that pricing objectives are met the instant the market can fulfill them.

The farmer’s time is invaluable. Especially as spring planting gets underway, a farmer’s attention is drawn in a variety of directions. Making sound marketing decisions in a volatile market place is just as important as choosing the right variety of seed, or fertilizer to apply. Being proactive in setting targets allows the farmer to set realistic pricing goals, and avoid emotional decisions in the heat of a rally, which may not last the length of a phone call.

This time of year often presents seasonal volatility, as trade will be sensitive to changes in weather as crops go in the ground. A “weather premium” is usually priced into the market to account for potential weather changes over the growing season. This often presents pricing opportunities for farmers.

MAC offers its customers the ability to place targets for cash contracts, forward cash contracts, hedge to arrive contracts, or pricing existing basis contracts. Contact your local MAC facility merchant today to implement a targeting strategy that fits the needs of your marketing plan.

Technical Thoughts – April 18, 2019

By: Ken Lake

May corn remains oversold.  Support is the contract low, 355.  The market will be sensitive to USDA’s crop progress reports each Monday afternoon and weekend forecasts.  No sales advised.  Target 379.

December corn, like the May contract, is oversold.  Support is 384.  No sales advised.

May soybeans are very oversold and look to at the beginning of a correction higher today.  Hold off sales until the oversold condition has cleared.

November soybeans have fared better than other contracts but very oversold today.  No sales recommended.  Target 945 or better.

The wheat market is very oversold.  No sales advised.  Long-term target is in the 530 area vs the July contract.

Charts of the Day – April 17, 2019

CK19 - Apr 17
SK19 - Apr 17
WK19 - Apr 17

Afternoon Market Commentary – April 17, 2019

by: Chris Betz

Corn Soybean Wheat
Old Crop (futures month, change, settle price) CK9 0’6 358’2 SK9 9’0 879’0 WK9 2’0 447’0
New Crop (futures month, change, settle price) CZ9 0’6 386’6 SX9 8’6 912’2 WN9 1’6 450’2

Fertilizer Update – February 21, 2019

By: Emily Calderone

2018 was an interesting year in the fertilizer market – in the last quarter of the year, opportunities to book tons at lower costs were much smaller windows than we’ve seen in previous years, and a wet fall made it hard to get nutrients in the ground before it was too late. Thankfully, some things are looking up  as we progress through 2019. We are seeing good opportunities to book ahead and although not all prices have softened, overall values are more favorable in terms of current corn prices and nutrient removal than what we saw in the past couple months.  Prices have been falling at New Orleans (NOLA) on a few different fertilizer commodities, but as warmer weather and planting season is around the corner in more southern states, prices likely won’t stay where they’re at long – none of us are strangers to what spring demand across the US does to fertilizer prices.

N:
Urea has softened at the gulf, but supply costs are holding at their current rates in the Midwest. There has been strong urea demand due to a wet fall and less NH3 application than expected – but compared to the values we saw heading into 2019, now is a good time to book spring tons. 28% has also fallen, with CF tiptoeing back into the market and Koch depressing prices to stay competitive. These values are expected to climb again before the spring demand hits and we have already seen prices move up slightly in the past week so it would be a good time to evaluate what your need is for spring/summer applications and get things booked. Anhydrous prices have been interesting in comparison with values maintaining steady and keeping on the higher end despite less demand through the fall season.

P:
We’ve seen MAP and DAP climb but were pleasantly surprised with values falling about $10-$15 at NOLA, likely due to the nitrogen component falling softer. There have been some opportunities to buy bulk loads at lower costs, but throughout the Midwest, retail values have looked fairly steady due to many tons being bought in 2018 and less fall applications than expected due to the wet weather we saw. Prices will likely not look much softer through the spring season as phosphate demand rises. 10-34-00 demand and supply will probably look tight into this spring (as always) although there have been opportunities to book tons at a lower cost. The trend has been to book tons a few months ahead of time to guarantee stock at the ports, as sales become harder to assure at the end of each quarter. If you’re expecting more 10-34-00 use this spring due to lower phosphate applications this spring or increased corn acres, looking into booking your tons ahead of time would be wise to make sure you have what you need to get you through this spring.

K:
Potash has continued its steady climb and word from the 3 major producers is that worldwide demand is more so than worldwide production, so expect the minor upswings in price to continue throughout 2019. For now, potash prices are still fairly favorable in terms of nutrient removal and current corn prices, and we likely will not see any price drops – even the “winter fill” program that usually gets put on was minimal this year, with major producers letting buyers know that prices would hold steady for a week and then climb up another $5-$10 at the ports in mid-January.

Opening Calls – December 3, 2018 at 7:12 AM

Beans are up double digits after Saturday’s announcement that the U.S. and China have reached a trade truce, and either side will not levy additional tariffs on the other. More work needs to be done to reach a firm resolution to the trade dispute, but the tone should be much more positive moving forward. Beans were up as much as 29 cents at the open of the overnight session Sunday, and currently up 16 ½ cents. Corn and wheat tagging along with corn up 4 ¼ and wheat up 5 ¼.