OJ/ Coffee Random Musings

I missed this:


(Update with closing share price in second paragraph.)

By Choy Leng Yeong
June 3 (Bloomberg) -- Tyson Foods Inc., the second-largest
U.S. poultry producer, fell the most in almost nine months in New
York trading after finding a flock of breeder hens was exposed to
a low-pathogen strain of avian influenza.
Tyson tumbled $1.47, or 8 percent, to $16.98 as of 4:15 p.m.
in New York Stock Exchange composite trading, the biggest decline
since Sept. 5. The shares have gained 11 percent this year.
``Preliminary tests on the flock indicate the presence of
antibodies for H7N3 avian influenza, however, there is no
indication the birds currently have the virus,'' spokesman Gary
Mickelson of Springdale, Arkansas-based Tyson said today in an e-
mailed statement.
Tyson is working with the U.S. Department of Agriculture and
the Arkansas Livestock and Poultry Commission to manage the
15,000 affected chickens in Arkansas, Mickelson said.
 
I think the cattle crush spread goes like this

6 Live Cattle -3 Feeders - 2 Corn

I forget when the seasonals favor buying the spread and selling it.

If I remember, going into summer one initiates a long in the spread.

Buy 6 Dec 08 Cattle, short 3 Jan 09 Feeders, short 2 Dec 08 Corn.

I think the argument goes that seasonally feedlots make more money going into the fall ( I forget why) so you want to buy Fats and sell the input costs i.e. Feeders & Corn. My thinking would be that as harvest rolls around grains become more plentiful and cooler months might contribute to lighter cattle coming to market, i.e. less supplies and higher live prices. Around Thanksgiving one unwinds and:

Sells 6 August Cattle, buys 3 Aug Feeders, buys 3 Sep Corn.

Had one sold that spread in 11/2007 the spread went from 16,000 USD to around 6,000 USD by the end of April. What does this all mean? Input Costs rose more rapidly than Fat prices did. Feeders and Corn outperformed Fats.
 
hey guys couldnt post last night sorry, girlfriend went on a house cleaning rampage! It's not the cattle crush spread, that one does look nice though. I'm gonna look into that one for sure man thank you. Coffee up today, I dont know what to think about this damned market. Selling into these rallies has rewarded me handsomely twice before. I would like more of a pop before I sell again though. OJ is down, the only way to play it in hurricane season is long though, at least for a position trade. And Oj is so fucking illiquid that it's very hard and dangerous to scalp. I've never traded oj options how are they riv?
 
good luck on cattle today shagi. I cant really trade, I have a buddy going to Moldova for the summer and I'm the airport driver. I see alot of upisde for beans and wheat still. Watch those two wheat especially. Some of those spreads are getting very out of whack and will continue to do so. I know shagi doesn't like spreads but I picked up 2 or 3 bucks on some of the wheat spreads last year. I dont think they will get that crazy but who knows what will happen. What happened to wheat last year with all the rain is now happening to corn. But I'm not sure how bullish I really am. Anyways good trading, and good luck guys
 
short another sep coffee at 139.00 that little pop will leave a nice little gap to fill. I suspect we are going back to fill a gap at the 140.00 level that is open from the other day, then back down. But we shall see!
 
Quote from Rtrader2525:

good luck on cattle today shagi. I cant really trade, I have a buddy going to Moldova for the summer and I'm the airport driver. I see alot of upisde for beans and wheat still. Watch those two wheat especially. Some of those spreads are getting very out of whack and will continue to do so. I know shagi doesn't like spreads but I picked up 2 or 3 bucks on some of the wheat spreads last year. I dont think they will get that crazy but who knows what will happen. What happened to wheat last year with all the rain is now happening to corn. But I'm not sure how bullish I really am. Anyways good trading, and good luck guys
More...

I got smacked on the Coffee short and Heating Oil long.

But cattle is paying for those smacks:D
 
I missed a hell of a day holy shit. Im short two more oj at 139.00. man what a wild day fuck i coulda made some dough oh well. Im looking to get out of these oj at 136 or so, and then be flat over the weekend. I might actually go long a july coffee and oj over the weekend. During hurricane season neither of those will open limit down but they very well may open limit up!
 
edit when i said oj i meant coffee my bad guys. Market is behaving weird, lots of stop running. There seems to be heavy producer selling at the 139-142 levels, I can't blame them thats a ton of money. i will cover regardless tommorow. Apparently a cold front might be moving in. Or I may just spread em and throw on some long july we'll see. Oj is looking strong now, but we will see how tommorow is. I am looking into some wheat spreads, anybody else got anything else going on??
 
Took profits, albeit probably premature on my OJ call. Sold at 570 pts.

Guess I sold more in disappointment that I didn't get long the futures and rather played it with the options.

Interestingly enough I had the order working on the floor all session long and when it closed I worked the offer on ICE and got lifted almost instantly. Makes me wonder about all the jobbing they do down there in the pit.


Came in this a.m. and started to get weary with the long cocoa after all that Fed inflation speak was propping up the DXY and dollar longs were getting emboldened. So, opted to buy an OTM Sep Euro put only to have Trichet come out and talk about rate increases, reversing dollar gains into losses and having the EUR trade up almost two big handles. Sold the put for half of what I paid this a.m. so not too great. Like you guys said, whipsaw.

Feels like coffee wants to be traded from the long side, though my bias is to be short I wouldn't be short until we get a bigger "pop".
 
thats kinda fishy on the ICE that's not the first time I've heard something like that, makes a guy wonder eh? Yeah Trichet really sent some shockwaves, I was tryoing to short euro overnight, then changed my mind about 10:00 pm and took the order off. After this huge sell off I didnt feel comfortable getting short at that level. I'm glad I took that trade off. Dodged a huge bullet. 150 ticks wow thats a move! I still like coffee from the short side, seasonally it goes down every year around this time. We've already seen a big downside move but I feel there can be more. Those longs are really defending the 134.00 level now. And doing it well.
 
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