Corn is trading higher by about two cents this morning after prices sold off sharply over the past two days to see the March contract lose over 12 cents, make new contract lows, and get very close to the 4-dollar mark.
Yesterday’s ethanol production report was slightly friendly with ethanol stocks falling by 1.2% to 25.502m bbl where analysts were expecting 25.982. Plant production came in at 1.084m b/d which compared to survey averages of 1.079m.
While the majority of the recent selloff has been due to selling pressure by the funds and basis contracts that are coming due, significantly improved weather in Argentina has seen the corn crop there improving.
Soybeans have been following the same trend as corn in which they open slightly higher and then tend to fade lower throughout the day. Yesterday, March futures came just 1-1/2 cent from taking out last year’s low in May at $11.45.
Both soybean oil and meal are trading slightly higher this morning, but the overall trend has been lower which has caused crush margins to narrow.
Following Tuesday’s relatively impressive export inspections number for soybeans, estimates for export sales are within a range of 300k and 800k tons with the average trade guess at 515k. If realized, this would be above the previous week’s exports.
All three wheat classes are trading higher this morning and are led by Chicago wheat. There has been little wheat news to trade so much of this week’s move was likely short covering.
March wheat is on track for a gain on the week that is close to taking out the previous week’s losses. The funds do not currently hold as large of a net short position in wheat as they do in corn and soybeans, but they are clearly rolling out of some of it.
The French wheat crop continues to see issues with soft wheat rated just 69% good to excellent where last year at this time the crop was rated 95% good to excellent. The barley crop is also rated lower than last year.
Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.
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