Block cheese closes down 0.75 cent on CME

 Resize text         Printer-friendly version of this article Printer-friendly version of this article

Editor’s note: This market commentary is provided by the Dairy Division at FCStone in Chicago, Ill.

Class III milk prices firmed yesterday in a soft block session day. The fact that prices moved up post-spot is bullish, the fact that once again price strength came on lighter volume is bearish. Unless we get a higher price day with strong volume, this thing looks somewhat limited on price strength short term.  Cheese futures managed to trade over 100 contracts on a firm session with July leading the way up .0100 to 178.9000. The spot cheese market has been inverted for eight straight sessions; last year, it saw 13 consecutive session of inversion having begun June 21.

Spot Session Results

Block cheese: $1.715 (down 0.75 cent)

Barrel cheese: $1.7725 (unchanged)

Grade A NFDM:  $1.7025 (unchanged)

Butter: $1.535 (unchanged)

In the grain complex, equities ran up, energies firmed on Syria concerns and the grains began yesterday down but turned around on outside market factors and old crop tightness.

Old crop July corn probably isn’t going anywhere but over $7. As we approach first delivery notice at the end of this month, we do have some susceptibility to find rolling but whether it’s sooner or later that contract looks poised to blow through $7 like a warm knife into butter. Beans were lower, but new crop fell almost 9 cents more than old crop.

The real story was the old crop corn and, in general, the fending off of daily lows for the grain complex. In the afternoon, we got crop condition reports. First, beans are now 85 percent planted vs. 98 percent a year ago and 91 percent on average. The corn condition was rated 64 percent “good” or “excellent” ―1 percentage point above both last week and last year, while beans were rated 64 percent, same as last week and 8 percent ahead of last year. No real worries there to the crop already planted, but still overnight there was no thrust lower. What can provide that big push lower that so many have been anticipating? And if it doesn’t come, do prices pop upward? All we are saying right now is the boat is very heavy to one side and that makes us a little bit nervous.

This morning, we look for grains to open steady to 5 higher across the board.

The trading of derivatives such as futures, options, and swaps may not be suitable for all investors. Derivatives trading involves substantial risk of loss, and you should fully understand those risks prior to trading. Any reference to past performance is not indicative of future results. All references to futures/options trading are made solely on behalf of FCStone, LLC. All references to swap execution and bi-lateral swaps are made solely on behalf of INTL Hanley, LLC. FCStone, LLC will clear swaps when applicable. Swaps are only available to eligible counterparties. All observations of economic, political and/or market conditions are not intended to refer to any particular trading strategy, promotional element or quality of service provided by INTL FCStone Inc. and its subsidiaries and should be construed as market commentary. All recommendations to buy or sell a specific derivative or forecasting statements regarding market activity and the pricing thereof should be construed as a solicitation in any jurisdiction in where such an offer or solicitation would be legal. Proper context and guidance including but not limited to the particular trading objectives, financial situations and the needs of the intended audience were taken into consideration when this recommendation was prepared. Contact your account representative for specific advice to meet your specific trading preferences or goals. These materials represent the opinions and viewpoints of the author, and do not necessarily reflect the viewpoints and trading strategies employed by INTL FCStone Inc. and its subsidiaries. Sources of information believed to reliable were used in preparing such observations, and no guarantee or representation regarding the accuracy of those sources has been made. INTL FCStone Inc. and its subsidiaries are not responsible for any redistribution of this material by third parties, or any trading decisions taken by persons not intended to view this material.

 



Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


Grand L60 Series

Kubota’s Grand L60 Series combines a higher level of luxury with outstanding productivity never before seen in this class of ... Read More

View all Products in this segment

View All Buyers Guides

)
Feedback Form
Leads to Insight