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Turner’s Take Podcast: WASDE, Rice, Crude, Beans v Wheat, Cotton, and Corn
Turner's Take Podcast

Play Turner’s Take Podcast Episode 218

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New Podcast

In this podcast we go over the Feb 11 WASDE, our thoughts on rice, crude oil, cotton, corn, and the spread between soybeans and KC wheat.  Make sure you take a listen to the latest Turner’s Take Podcast!

If you are not a subscriber to Turner’s Take Newsletter then text the message TURNER to number 33-777.  You will receive the newsletter and podcast notifications for free!

Rice

Imports on rice increased in the last WASDE and that has caused some selling and profit taking.  We still like rice but if the USDA is going to balance the tight balance sheet with imports than the bull story may be over for rice. The USDA has average rice prices at $13.  Futures are about 30 to 40 cents higher in the front month.  The big question is if imports can meet all US demand. If so then it is time to get out of rice and move on.

Crude Oil

Below is a chart of July vs Dec crude. This is a seasonal bull spread that tends to go higher this time of year. I like it because crude has sold off so much due to the coronavirus and I think we are going to rebound. The margin is $600 per spread, I think we are finding support at these levels, and I think the market has priced in the economic impact for coronavirus.  The risk is an outbreak in Europe or the US.

Cotton

Below is the May vs Dec Cotton bull spread.  We see China buying cotton from the US as part of the Phase One trade deal.  Seasonally this spread is bullish too.  The trend is higher and support levels are holding.

Corn

Below is July vs Dec corn.  I like this as a bear spread. South America has a big crop.  The US will have a lot of new crop acres.  We don’t have a shortage of corn.  The USDA probably understated last year’s crop and farmers are not selling. The basis is strong now but once farmers start selling corn the basis will get weaker.  First target is -15 cents (carry) and if the market completely falls apart July/Dec could go below -20 cents with the new storage rates at the CME. Margin is $440 per spread.

Soybeans vs HRW Wheat

This is a seasonal spread of May Soybeans vs May KC wheat.  I think soybeans are a very good value at or under $9.  Ending stocks are 425mm bushels and we are almost at 10% stock to usage. In a normal year beans would be in the mid $9s and new crop making a run at $10 during weather rallies.  KC wheat is elevated due to issues with the Chicago contract.  Weather premium tends to come out of wheat as we head into spring and the risk of winter kill passes.  Conversely we are just getting started with the US soybean crop.  I think the chart is finding support at these levels too.

 

If you are not a subscriber to Turner’s Take Newsletter then text the message TURNER to number 33-777.  You will receive the newsletter and podcast notifications for free!

About Turner’s Take Podcast and Newsletter

If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes!

Craig Turner – Commodity Futures Broker
Turner’s Take Ag Marketing: https://www.turnerstakeag.com
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Twitter: @Turners_Take

Contact Craig Turner

Turner’s Take Newsletter & Podcast

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Turner’s Take Newsletter & Podcast – Turner’s Take is a complimentary weekly market commentary newsletter that covers the Grain, Livestock and Energy futures spread markets using fundamental, technical and seasonal analysis.

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Risk Disclosure

This material is conveyed as a solicitation for entering into a derivatives transaction.

This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.

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About Craig Turner

Craig Turner is a Senior Broker at Daniels Trading, author of Turner’s Take newsletter, and a Contributing Editor for Grain Analyst. Craig is often quoted in the Wall Street Journal, Reuters, Dow Jones Newswire, Corn & Soybean Digest, and also makes appearances on SiriusXM – Rural Radio Channel 80 providing commentary for the Grain and Livestock markets. Craig has also been featured in FutureSource’s Fast Break series, Futures Magazine Online, and INO.com. Mr. Turner has a Bachelors from the Rensselaer Polytechnic Institute (RPI) where he graduated with honors and has worked at the NYSE and Goldman Sachs. While at Goldman, Craig earned his MBA in the NYU Stern executive program. Learn more about Craig Turner.

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