Markets are stronger this morning with corn up 6 and soybeans up 9.
The three factors supporting the markets today are a weaker US dollar, dry weather in Brazil for the Safrinha crop and cold US temps to start the week.
The 10 day forecast has no rain in it for second crop Brazilian corn. This is the dry season for Brazil; it just seems that this year the extremes have been greater than usual. No rain for the next 10 days is going to pull yields lower. Brazilian corn is right ahead of pollination. Temps will be in the 80’s-90’s.
Expectations for this afternoon’s corn planting progress are expected to be 10-11% vs. 8% for the 5 year average. The first soybean planting progress update is expected this afternoon as well.
Friday’s report showed the funds adding 15,400 contracts to their net long position in corn. They are currently estimated to be long 402,000 contracts which is the largest net long since January of 2011 and nearing the all-time record long of 429,000 contracts.
I would advise producers to get firm offers in for old crop corn in the $5.90-$6.00 range and new crop offers in between 5.00-$5.15 range. While the market has been slowly climbing higher, we need to keep in mind that the funds are running the market right now and at some point they will start to dump these longs and send the market into a quick tailspin. We have a gap in December corn to fill between $4.775 and 4.8076 that I would expect to see filled in the coming weeks.
Have a Safe Day!