Good Morning,
Markets are stronger this morning with corn up 6 and soybeans up 29. Will todays trade be the same as yesterday? Yesterday was a wild ride, and today may not be much different. The markets were up these same levels yesterday before closing lower on corn and 1 higher in soybeans. If we are trading weather, the change to wetter in Argentina would produce a lower trade. I don’t know where we close today, but we are definitely in the volatility stage of the market. Trade gets nasty on highs and lows.
On Monday, Managed funds were net buyers of 2,000 wheat, net even corn, bought 5,000 soybeans. Funds are estimated to be net long 36,000 contracts of SRW Wheat; long 357,000 Corn; net long 222,000 Soybeans.
The forecast has a significant change to a wetter forecast for Argentina and Southern Brazil. The forecast into Jan 15 has the most rain forecast in months. Should this forecast hold true, this would be the crop saving rains that Argentina has been looking for. So far, most of the forecasts for Argentina have gone bust. A confirmation of the mid-day forecast and again tomorrow morning, may give traders a pause in the buying. Northern Brazil looks to get very good rains over the next 10 days which will help later planted crops. Some early beans are already being harvested, with yields down between 10 and 40%.
As I stated in yesterdays comments, this rally is not sustainable and producers should be making sales of old and new crop corn and soybeans. These are profitable levels for all operations and should be captured.
Have a Safe Day!
Garry Gard
920-348-6844
ggard@didionmilling.com
