Good morning,
The grain markets are quiet to start the day with corn up 3 and soybeans up 2.
We will have the USDA September stocks report on Friday. This report has caused some volatility over the years in the finding and losing of bushels. Corn has been the big mover with additions of 400-500 million bushels a couple times in the past. Sometimes you get co-mingling of old and new crop stocks as well, early harvest tends to boost carryout. Traders will probably not want to be too long or short for this report. The Average Trade Guess is 1.512 for corn, .242 for beans and 1.776 for wheat. It may not seem realistic to have 1.500 billion bushels of corn left when prices were being paid up above 8 dollars a few weeks ago but I believe that is due to the physical location of the stocks. The west and southwest were short last year and will be again this year. The north and east had good crops last year and will likely follow with another good crop this year. Logistical restrictions and costs will keep things tight in the west.
I believe the recession is going to keep things from getting too wild this next year. The funds would need a lot more money to build the long positions they held last year. Last year they were long over 400,000 corn and 260,000 soybean contracts. I don’t see that happening this year. They are currently long 215,000 corn and 78,000 soybeans and that might be as much as they can do unless the government changes on their interest rates.
Have a Safe Day!
Garry Gard
920-348-6844
