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Grains & Beans

  #111 (permalink)
 myrrdin 
Linz Austria
 
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440 HRW are delivered vs. the WU contract. The current level of the KW-W spread obviously is not sustainale.

Best regards, Myrrdin

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  #112 (permalink)
 myrrdin 
Linz Austria
 
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The KWZ-WZ has almost reached one US-Dollar.

There a good reasons to get long this spread in the near future:

For the September contract, there was a large delivery of KW against the W contract. As price level is even lower now this will probably happen again for the December contract.

Soybean harvest in Kansas was just 13 % complete at the end of last week. Double crop Wheat after Soybeans might get difficult for some farmers. Thus, there could be a decline of plantings for HRW.

There are rumors that China will buy HRW in the first phase of the trade pact.

Seasonal charts show a strong upwards move from early January onwards.

Because of the low price for HRW also for the new crop contracts, farmers might decide to plant other Grains for 2019/2020.

I am long the March, July and September contracts. I assume that the new crop contracts will end up above 0. This crop currently is planted.

Best regards, Myrrdin

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  #113 (permalink)
zxcv64
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Oats. I notice that this spread ZOH20-ZOU20 has risen a lot lately. I know little about the fundamentals behind this, as I am currently travelling and just stumbled upon this technical overbought situation.

Any opinions anyone?

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  #114 (permalink)
 myrrdin 
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zxcv64 View Post
Oats. I notice that this spread ZOH20-ZOU20 has risen a lot lately. I know little about the fundamentals behind this, as I am currently travelling and just stumbled upon this technical overbought situation.

Any opinions anyone?

In the grains & beans, I currently only trade inter-commodity spreads.

The reason: There are two possibilities: Either there will be a deal between China and the US, or there will be no such deal. Eihter prices of grains & beans will move up strongly, or not.

As foreseeing the politics of Mr. Trump is about as difficult as foreseeing the long term weather, I do not trade grains & beans outright.

Thus, I do not study a lot about grain prices, and have no idea about the reason for the current strong price movement in oats.

Best regards, Myrrdin

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  #115 (permalink)
 myrrdin 
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I still hold a rather large position of KW-W (H, N, and U). I have added to my position near -100 in the March contract.

Furthermore, I just entered a position in the SN-SX, hoping for the Chiniese entering buying beans.

Best regards, Myrrdin

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  #116 (permalink)
 myrrdin 
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myrrdin View Post
I still hold a rather large position of KW-W (H, N, and U). I have added to my position near -100 in the March contract.

Furthermore, I just entered a position in the SN-SX, hoping for the Chiniese entering buying beans.

Best regards, Myrrdin

I am still long the KW-W spread in the new crop contracts (N, U, Z), after rolling the March contract to December. Some day the spread will cross the 0-line - but I have no idea when.

I liquidated the SN-SX spread some days ago with a (very) small profit.

Best regards, Myrrdin

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  #117 (permalink)
 myrrdin 
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After publication of the acreage estimates, I bought the SX-CZ. The spread should move upwards - even significantly in case the Chinese decide to buy beans.

Best regards, Myrrdin

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  #118 (permalink)
 
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 SMCJB 
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Hey @myrrdin or anybody in fact, can you explain what the Variable Storage Rate (VSR) mechanism is?

SER-8554: Variable Storage Rate (VSR) Results for Wheat and KC HRW Wheat Premium (Storage) Rates
https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2020/03/SER-8554.pdf

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  #119 (permalink)
 myrrdin 
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SMCJB View Post
Hey @myrrdin or anybody in fact, can you explain what the Variable Storage Rate (VSR) mechanism is?

SER-8554: Variable Storage Rate (VSR) Results for Wheat and KC HRW Wheat Premium (Storage) Rates
https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2020/03/SER-8554.pdf

Sorry - I am unable to find a direct link and post it here. But Googling "cmegroup" "vsr-whitepaper" should direct you to a pdf explaining the concept.

Best regards, Myrrdin

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  #120 (permalink)
 trepidation 
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myrrdin View Post
Sorry - I am unable to find a direct link and post it here. But Googling "cmegroup" "vsr-whitepaper" should direct you to a pdf explaining the concept.

Best regards, Myrrdin

https://www.cmegroup.com/trading/agricultural/files/vsr-whitepaper.pdf

and mirrored

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