Corn: March corn settled down 6 ¼ cents at $4.07 ¾. Corn traded in a 10 cent range during today’s abbreviated holiday session. Tuesday’s 5-1/2 month high at $4.15 ¾ was not breached today for March corn. New crop CZ15 settled down 5 ¼ cents at $4.31 ¾. , after trading to a new 5-1/2 month high at $4.38 ½ right on the opening bell at 8:30 AM. That high marked a 74 ¼ cent rally from the contract low down at $3.64 ¼ posted October 1st. This pencils out to a 20% gain in value. Most technical traders still have the July4th gap at $4.23-$4.26 in March Corn as their next bulls eye. Certainly the funds, who maintain the largest long position they have had since last May, with 280,000 longs, have made the bet that the USDA will surprise to the upside again when they report final carryout on January 12th. We’ll also get final acres and lay to rest the argument over how mahy acres were not planted in 2014. There are just 11 business days left before the January 12th USDA report. Hedgers: Top Third is now 30 % sold on 2015 guaranteed bushels which we sold into the rally over the last 3 months. Remaining unpriced bushels can still be protected for the next 331 days with a $4.00 floor for 25 cents a bushels. Wheat: March wheat settled down 24 cents at $6.11 ½ which is the lowest settlement in 2 weeks. With rumors that Russia was still loading up to 100K MT of wheat daily in barges in the black sea. Egypt has insisted that their existing contracts be fulfilled, and for the time being, it looks like those contracts will be honored. Most of the uncertainty for Russian wheat will focus on their new crop which hits market in June. With good snow cover currently under way, it should protect the crop from dropping temps. Technically, the funds are still having the biggest long bet on the books since last May, with over 80K contracts locked and loaded. The 7-month high posted just last Thursday at $6.77 looked to be a capitulation top, as open interest dropped on that rally. In the last 4 days, WH fell over 70 cents, punctuated by today’s low at 6.06 ¼. This truly looked like a marketing gift given to us by “Russian Phyto-sanitary issues”. Hedgers: Top Third recommended getting to 60% sold in guaranteed bushels for 2015 wheat, which we did in 10% increments over the $1.70 rally. Remaining unpriced bushels can be protected at $6.00/bushel for the next 184 days with a WN $6.00 put for 34 cents a bushel. With just 12 business days left before the USDA report on Jan 12th, it’s important to get your downside protection in place. Soybeans: March soybeans settled down 10 ½ cents at $10.35 ¼. No real fundamental news hit the bean market during today’s abbreviated holiday session, although we did get a 20 cent trading range. Technically, March remained below the $10.50 level, and roughly right in the middle of its $1.00 range we’ve been mired in for the past 8 weeks. The weather in South America remains Eden-like, at least for the 14 day to 21 day forecast, with ample rains. Barring weather issues, South America could be looking at another bumper crop. With fundamentals like that on tap, it’s imperative to get your floor for your unpriced bushels. Top Third is 25% sold on guaranteed 2015 bushels, which we sold during the $1.70 rally sparked by the December meal squeeze. Hedgers: Protect unpriced 2015 bushels with a $9.40 put for 40 cents for the next 303 days. For a shorter term horizon, with a higher floor, consider a March dated $10.00 New Crop put for 30 cents or less. This gives you a floor just 14 cents under today’s settlement, for the next 58 days, which gets you through the USDA report and the February WASDE. Some days, like today, the shorter the letter the better. We have a lot to be happy about this holiday season. The US GDP grew 5%, the best gain in 11 years, CZ15 posted a new 5-1/2 month price high on the opening bell today ; gasoline at the pump is below $2.20 (here in Illinois) and the stock market is sitting at record highs. CER
