Hedge

If the USDA goes with the top end of the ATG on corn acres, that will put next years ending stocks around 2.1 to 2.2bbu. Last year that is exactly the same stock estimates we started with in May (2.172bbu), and CZ24 traded in the 460-490 range through June. So today, with CZ5 at 440, I think the market is already pricing in perfection, and underestimating the risks.

@Chitturi_Vamshi Sure thing my friend. The last 5 years for you.

@GrainHedging Any chart to this data please comparing with previous year if possible

Corn exports are projected to be up +7% yoy. Corn exports are currently running +35% yoy.

CZ25 is up 7.5% to start 2025. - This is the 6th best start in the past 20 years. - There is a positive correlation between how CZ starts the year and continues into summer (i.e. trends continue). - This years strong start would correspond with a final change by June 1 of +15%, putting CZ25 at 498. I think we see CZ5 hit 500 at some point.

@GrainStats So basically there are only two ways of making money going forward? 1. Sell a non-software product 2. Sell someone else’s non-software product

i spend probably +40 hours a week using AI tools i am deeply convinced that any software/service you are currently paying for will cost a fraction of what it is currently largely because: 1) one person team + AI can do just as much if not more than 4-10 skilled individuals 2) if anyone has this power and know how, what’s stopping them from shipping tools/software into the economy at cut throat costs? it’s going to be a race to the bottom for all of these apps/software as attention (real currency) shifts from high priced software to low cost or even “free” software backed by advertisements (mostly web apps) prices will get so competitive that it won’t be worth it for new entrants to compete and all revenue models will be advertising based that being said, i am extremely bullish anyone who can capture attention as attention is the currency of the internet. being able to direct that attention to advertisements is probably going to be the end all winner in this race.

@MichaelWSpike Great thread. I didn't realize it until now, but this has been on my mind a lot lately. I have always loved the chase. It is what draws me to the market. But if I am being honest, I have felt extremely burned out lately. To the point I am considering more predictable careers.

would lead to some larger, more stable book like the aforementioned professions That is my thought for today. Hope everyone keeps their positions tight and their P&L's positive as we head into harvest. Stay safe, full, and hydrated Cheers

I think there is a unique grind to commodity trading that most other professions don't quite have, a 🧵: The never ending "what's next" Property developers, Doctors, accountants, etc can build a client network that just *exists* Commodity trade is an ever evolving beast 1/

@MarketMinuteLLC They are chipping away. They are good at buying.

#Soybeans need China to save the day Deep into bear market territory, approaching trade war levels 🐻 In other bear market years we found support between $8.50 to $9.50.. during the trade war it was $8.50 China is severely under bought. What does China do? 🇨🇳 A.) Wait to get it cheaper B.) Buy soon Until China comes in heavy, no telling how cheap we could get. Once they do, it will be a good indicator that we are near the bottom.

@GrainStats Very cool, congrats and good luck. I know you have put in a lot of work into this over the years.

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@FarmerTheta Possible. But I think it usually rallies just after the Fed cuts, and then sells off hard. So that’s why I think we have one more leg up.

Grain prices were the first signal for inflation going up, and now inflation going down. If you don’t follow commodities, you are missing out.

@GrainStats That is a good point. I was just guessing they just don't want to share data because lack of transparency has always been important to grain traders. I am not familiar with geoGrain, but I would think that data is very valuable.

@GrainHedging GeoGrain(sp?) did that a few years back and I didn’t see many lose their jobs outright at the end of the day though, if your job is to buy, buyers should simply make it easy for people to sell them whatever they are trying to buy

one of the most annoying things about the grain industry is going to a buyers website and not seeing a bid for grain instead, “install this app” or “sign up for our text messaging service “ for all those that are doing it, it actually TURNS AWAY BUSINESS by making trade less transparent and wasting people’s time that are ACTIVELY LOOKING for this resource how to fix it? get your IT department to simply display bids on the “Grain Bids” section if they can’t build something so simple, get in touch with us and we’ll do it for you

@TheIrishman3097 Has the farmer position + fund position ever not been long though? I mean, the farmer always has stocks, and half the time funds are long too.

The market is not short. When peeps say the 'market is..' they are invariably referring to only the futures markets and how the larger MM funds are positioned. They always forget the cash market and how the farmer is positioned-and the farmer is always long. The cash market and the futures markets combined will give you the aggregate net position of the market as a whole. And right now, that market is LONG!!

So who’s this?

@jonbottiger What would be an example of a short theta but positive gamma trade?

@jonbottiger Do you really feel confident in the usda printing 184?

@GrainHedging Obviously the market is ahead of 2.097. Try 184 in yield Then it all makes sense.

One other interesting data point is that on farm stocks (as of June 1), are 1.162bbu more than in 2014. So comparing 2014 to 2024: --> On farm stocks +1.16bbu --> Fund position -2.07bbu

To add more context. In 2014, the carry in was 1.232bbu and the carry out was 1.731bbu. The projections for 2024 are a carry in of 1.877bbu and a carry out of 2.097bbu.

A 400 CZ24 straddle is trading at 40c, giving you a profit range from 360 to 440. It is a tempting sale, but this market is a little too complacent for me... Pass for now.