News

Morning Commentary

May corn up ½ at $3.67

May beans down 2 at $8.99

The DOW is down

USD is stronger

Crude oil up $.27 at $58.53

Good morning,

Corn bulls are again pointing to rumors that China might be buying some U.S. corn out of the PNW. Bears are pointing to improved South American weather and field conditions. There’s also talk amongst the bears of an improved U.S. forecast out on the horizon. .  Trend funds are thought to be short 207,500 lots.  Their record short on a futures and options basis is 265,000 in March 2016.  The short term trend is negative but the market posted an outside day higher Tuesday.  Rallies that stall at 371.5 leaves the market vulnerable to 355.5.  There should be buy stops above 370 in the day session.  The options market is pricing in a 361.5-372 trading range the balance of this week. 

Soybean prices are little changed on the week. Bulls are pointing to a couple of strong sales recently made to the Chinese, but the market is giving it little consideration. There’s also more reports that trade talks between President Trump and Xi have been pushed back until at least April. I encourage you to read an article recently released in Successful Farming written by Betsy Freese and titled, “WHY YOU CAN’T BELIEVE WHAT CHINA SAYS ABOUT AFRICAN SWINE FEVER”. She spent last week in China on a market study tour with 25 members of the Iowa Farm Bureau. The group included corn and soybean farmers, hog and beef producers, and ag business people. I suspect as this article continues to circulate ASF will become a larger headwind and more concerning. Trend funds are thought to be short 106,000 lots.  Their record short on a futures and options basis is 147,000 in June 2017.  The short term trend is negative but the market scored an outside day higher Tuesday.  Closing over 910.5 is the minimum needed to improve the outlook.  Consecutive closes below 891 would signal renewed weakness.  There should be buy stops above 906.25 in the day session.  The options market is pricing in a 890.5-908 trading range the balance of this week. 

Ag Sec. Perdue Continues To Push Relocation of Ag Agencies: The head of the USDA effectively chopped in half the list of locations competing to host the ERS and National Institute of Food and Agriculture. Out of 136 sites across 35 states that were bidding to host the research agencies, Perdue has narrowed the options down to 67. Illinois has nine potential locations remaining on USDA’s list, followed by Virginia with eight, Ohio with six and Iowa with five. A total of 28 states still have sites in the running from Utah to Maryland, along with major cities like Dallas, Denver, Kansas City and Minneapolis.

The Trump Administration filed its proposed E15 rule on Tuesday that would authorize sales of the higher-blend biofuel in the summer months, bringing corn growers and ethanol producers one step closer to a long-sought policy win. National Farmers Union President Roger Johnson said the E15 proposal is vital for corn growers, but he also called for rolling back federal restrictions even further saying we need to build on the achievement by expanding use of E30 gasoline. (Politico)

 

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