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Feb 26, 2021 | 14:51 1 Gone from slightly bullish to neutral over the last two weeks.

It’s a demand market firstly.

Weather market secondly now was vice versa a while back.

Just can’t shift grain in oz for love or money.

Big crop.

Edit my broker commentator friend suggested to me Friday, if the big freeze didn’t occur in Texas wheat would be 50 cents lower by now. Took a while to digest that. And all the “freeze” photos I’ve seen a non event a month early to do any sustained damage.

But grain can turn on a dime. Await next round of weather dramas probably another month.

South America issues doing the rounds way different than info I get again the big dry a bit of a fizzer.

Everyone looking for reasons for it to go higher including me just ain’t happening just yet.
Last edited by malleefarmer; Feb 26, 2021 at 14:57.
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Feb 26, 2021 | 15:04 2 And reading between the lines on here seems none of you guys surprised in the fall of canola , kinda like had to happen just case of when. But seems you all sold on the way up empty bins.

Reading think twitter, fall in canola will shake out weak sellers will reach even higher highs very soon. Hmmm not sure.

Again twitter “experts from NHemishere” can go much higher when there’s exportable surplus in Australia $150 cheaper than anywere else but that was a few weeks ago. Canola price here this week has dropped about $6 per tonne only.

Can’t ship it out. Reply With Quote
Feb 26, 2021 | 15:44 3 How many weak sellers are still holding? Reply With Quote

  • ColevilleH2S's Avatar Feb 26, 2021 | 15:54 4
    Quote Originally Posted by shtferbrains View Post
    How many weak sellers are still holding?
    I could have sold March delivery Canola for C$776/Tonne locally, earlier this week. Anyone that held through that is not a weak seller by my definition. Reply With Quote
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    LEP

  • Feb 26, 2021 | 17:21 5 Was quite the turn at the end of the day in canola . Reply With Quote
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  • Feb 26, 2021 | 17:36 6
    Quote Originally Posted by ColevilleH2S View Post
    I could have sold March delivery Canola for C$776/Tonne locally, earlier this week. Anyone that held through that is not a weak seller by my definition.
    My point exactly. Reply With Quote
    Feb 26, 2021 | 18:11 7 If it drops everyone will be sold out
    If it goes up there will still be heroes holding Reply With Quote

  • Feb 26, 2021 | 18:17 8 Mallee, as a rule the longer a market goes sideways, the more energy it builds. We are not topping, in my opinion. Tops generally are a long wick candle, with immediate action confirming. None of this shit going sideways. Keep holding bullish sentiment. I show no end till "April" on a monthly level, so this can include the last week of March. Patience. I think a person really needs to hold some gambling bushels into summer, not lots but some. Reply With Quote

  • jazz's Avatar Feb 26, 2021 | 18:36 9 This market is being obscured. Can book in $750 for canola for April May but we cant deliver a single bushel spot at any price right now. Cause they are all full. Whats up with that?

    I cant tell the difference between real demand out there and paper speculation at this point. That makes this market fragile imo.

    2/3rds sold canola as of this week. Starting some durum now, $9 for 1CWAD today. Reply With Quote
    Feb 27, 2021 | 00:39 10 Last week every commodity has got the shitze on.

    Zilch happening here as I said price wise narrow range in wheat canola despite moves barley edging up.

    Wool I sold some two sales ago wed 17th best sale in 12 months a fluke. Prices retreated next day marginally and week just gone shed almost 7%.

    Only thing heading north here is beef and lamb. Reply With Quote
    Feb 27, 2021 | 02:10 11 Ps macdon 101 jazz errol everyone I enjoy your different view points and interaction on market direction.

    Never say I’m right or wrong but often say I’m peeved.

    And honestly don’t mean Jack shit what I say is happening in Australia compared to you guys, just for interest. Reply With Quote
    Feb 27, 2021 | 06:11 12 Does anyone write OTM calls on deferred months in a market like this to hedge new crop? As a way of protecting some costs or locking in a margin?

    A friend of mine did this but I always lacked the nerve. Reply With Quote
    Feb 27, 2021 | 06:22 13 Mallee, must be very frustrating not to get canola shipping going in SA.
    Two ships for March/April on the shipping stem. Is that right?
    European futures are at about 770 AUD for the May contract....

    I read an article where a farm in NSW pulled off a 7 tonne crop. Wow
    https://www.graincentral.com/news/du...ralian-record/
    Last edited by farming101; Feb 27, 2021 at 06:42.
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  • Feb 27, 2021 | 06:28 14
    Quote Originally Posted by burnt View Post
    Does anyone write OTM calls on deferred months in a market like this to hedge new crop? As a way of protecting some costs or locking in a margin?

    A friend of mine did this but I always lacked the nerve.
    To be low risk you would want to have some assurance of having actual bushels to back that option up. If prices go north and your option you sold is nominated for exercise it can get expensive

    I wonder if your friend also bought an ATM or near the money option and then sold/wrote OTM to lower his cost? Reply With Quote
    SASKFARMER's Avatar Feb 27, 2021 | 06:55 15 We are waiting for a bit till June. Stay tuned either I got this or I got this. Canada and the USA are dry. let that sink in. Reply With Quote
    Feb 27, 2021 | 07:18 16
    Quote Originally Posted by farming101 View Post
    To be low risk you would want to have some assurance of having actual bushels to back that option up. If prices go north and your option you sold is nominated for exercise it can get expensive

    I wonder if your friend also bought an ATM or near the money option and then sold/wrote OTM to lower his cost?
    IIRC, he was doing some spreads in some cases, but seemed to be comfortable with naked contracts, in some market circumstances. Perhaps as in now, when prices are very strong. But still, extreme volatility can make it extremely interesting...

    He did know his stuff better than I did, and I stayed with buying options.

    I remember his comment was - why not write them? They pay you.

    I would think his margin account wold have to be quite significant. Overall, he did very well so his methods were obviously not all stupid. Hard to argue against success, but sometimes there is much more to it than what is known. Reply With Quote
    Feb 27, 2021 | 07:47 17 Mallee your comments and thoughts are actually very important to help understand the markets. When our markets get slammed, it can be unnerving, and that’s the job of the market, to establish price ranges. To see Ausi market is stable, with the same exporters that we have I think is very telling. Thank you keep it up 😊

    No one has mentioned the canola exchanges. Is there enough volume, is it used enough by the buyers, exporters and farmers to be a fair representation of the cash market? Seems like there is a disconnect between cash spot markets and the futures price. Some buyers change the futures months plus or minus basis while others use different months. They don’t all use the same futures month to offer spot prices. Etc

    Any way in volatile markets I like to phone and talk to buyers with our targets, his insights and thoughts, no targets or basis commitments. I HATE basis contract as that’s a gift to the buyer that knows what volume is coming in for which month. They know the exact contracted volume and price as well as other volumes not contracted yet. I feel the same for price and volume target prices. A dream for a buyer. Reply With Quote
    Feb 27, 2021 | 07:56 18 Lots of black dry ground showing up here lately and it's going to be a lot harder to fake a big crop unless we get a major moisture event in the next 60 days. BUT when that weather pattern breaks we all know who really pays for it. The market guys just don't know where to put the money these days so they chose food. Reply With Quote
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  • Feb 27, 2021 | 13:15 19 Mallee I think we were in the same boat in 2008 our basis was terrible because nobody could get shipping because trains were moving oil. Reply With Quote
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  • Feb 27, 2021 | 14:06 20
    Quote Originally Posted by farming101 View Post
    Mallee, must be very frustrating not to get canola shipping going in SA.
    Two ships for March/April on the shipping stem. Is that right?
    European futures are at about 770 AUD for the May contract....

    I read an article where a farm in NSW pulled off a 7 tonne crop. Wow
    https://www.graincentral.com/news/du...ralian-record/
    Been the case for a while China controls shipping worldwide according to some in the game. They want cargoes in or out they get em rest of world waits at times. Then you guys have weather issues physically getting ships in and out to add to problems Reply With Quote
    blackpowder's Avatar Feb 27, 2021 | 14:14 21 Basis contracts can be shitty yes.
    They have uses tho. Don't discard them completely. Reply With Quote
    Feb 27, 2021 | 14:26 22 Re my wheat contract I spoke about earlier.
    Vessel due early to mid March.

    But still questions if they have enough containers.

    Somehow gonna try to get first in line. Reply With Quote
    blackpowder's Avatar Feb 27, 2021 | 14:31 23 Dumb question. How much of aus crop relies on containers? Reply With Quote
    Feb 27, 2021 | 14:52 24
    Quote Originally Posted by blackpowder View Post
    Dumb question. How much of aus crop relies on containers?
    Bugger all for wheat barley but legumes a lot I’d say.

    Bulk shipping and containers short here.

    Always premium price in container trade what ever the commodities Reply With Quote
    Feb 27, 2021 | 22:21 25 I know some of you guys will laugh even disbelieve but some traders here are cash strapped especially the smaller ones.

    Another reason for quiet market, they’ve gotta move what they’ve bought. Some of those guys are behind as well bulk shipments. Probably only a few weeks but same issues.

    Sometimes during our harvest buyers just pull out vanished our books are full which means just that or there merchant banks have said that’s it’s no more credit to trading arm of your company.

    Anecdotal heresay doing the round some small traders are on wrong side of the market with there canola hedging. Or backyarditis huge crop in oz small crop in Canada average in Europe got blindsided went through stops and are now bleeding hence canola market dead as a aged steak.

    Other line of thought by some here on the jittery market, gonna take 4 or 5 non rain events for markets to move and only one big rain event to send it tumbling.

    End users playing the waiting game just buying hand to mouth each week just slightly cheaper. They know farmers will sell soon for fertiliser and chemicals etc etc . Some years nothing easy about marketing grain here, but it’s reasonably orderly.

    Bulk elevator system our local took in 500,000 tonne that’s counts other small elevators grain now coming into a central point. Could be almost 250 to 300k unsold. Latest figures haven’t come out. Still 15 plus buyers operating but Mexican stand off about $30 below prices of 4 weeks ago. Odd day one guy will bid above everyone else bang filled with a hour. Means there short on a vessel coming in. Reply With Quote
    makar's Avatar Feb 27, 2021 | 22:29 26 Got a very smart very lazy neighbor, when asked why he wasnt dealing with a heating pile of barley he replied i have no time for marketing. Me neither but i move what i can when i can and contract nothing. Not a recipe for greatness but i have survived, for me cash flow dictates. Reply With Quote
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  • Feb 28, 2021 | 05:00 27
    Quote Originally Posted by makar View Post
    Got a very smart very lazy neighbor, when asked why he wasnt dealing with a heating pile of barley he replied i have no time for marketing. Me neither but i move what i can when i can and contract nothing. Not a recipe for greatness but i have survived, for me cash flow dictates.
    I’m in awe of you guys at times lock the bins etc etc hold on for months. Here down under at times we need cash. No insurance or anything. Th8nk I read on agriville recently some one had 8 year old canola just wow factor. Rarely is grain held over here for more than 8 months and nearly always gone by harvest. Mega rich guys probably carry over at times Reply With Quote
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    LEP