Merry Christmas to all of you. 12-26-19 : Long Feeders H/J/K butterfly @ -1.150 - F/H trending higher with index higher than F. - Low level. - Supposedly bullish fundamentals for beef with trade deal...
01-08-2020 : Long LE G/J/M fly @-9.125 - Trade deal with Japan and ( China ). - Low level. - Seasonals.
Hello everyone, Long time no see China-US agreement will start soon. Probably will be enforced due to the Trump (re)-election is coming. How the Ag market will react ? => Lean Hogs is very cheap compared to European & Chinese lean hogs. I would have any short and maybe go long, long calendar ? => Wheat could benefit from the trade agreement, Chinese likely to buy some SWW which has no future market They might also go MWE/KW. Term strucure is already very bullish. No clear trade for me => Soybean could benefit from that. Long term structure ? Backmonth are already high. Long soybean ? => Crush spread, could be a short given that chinese will buy more soybean tham meal/oil => Buy cotton / ethanol. My fund view is weak on these one, I don't know if it's a good idea What do you think ? Any idea/comments ?
-Hogs is a no brainer, we just need to go through the inventory first : Long a deffered spread I would say. -For wheat, I also read somewhere that China may actually need SRW but the price is too high. -Soybean is already fully priced as if stocks were huge this year and non existent next year. I wouldn'go long a 20/21 crop spread for sure. -Crush spread can be a good idea but beware of soyoil rally. -Cotton is also priced a bit like soybean( inverted in the next season ), so it is hard to be long deffereds. Ethanol needs China buying just to survive in terms of margin.
01-28-20 : Out @ -11.25. Good trade. Funny how when I recheck what made me take this trade, I wouldn't have pulled the trigger today.