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Morning Comments

May corn +4 at 5.495

May beans +12 ¾ at 14.4275

The DOW is UP

USD is UP

Crude oil -.34 at 65.75

 

Good morning,

 

Overnight grain markets featured gap higher openings in corn, soybeans and bean oil but it has been somewhat of a struggle to sustain that early momentum through the evening. Heading into the break, the markets are trading in positive territory with new crop corn, old and new beans, soybean oil, canola and palm oil each into new contract highs. The gaps are intact for beans and oil although the markets are all trading near their session lows. The dollar index is trading up 26 pts to a 3.5 month high which is dragging on commodities while southern hemisphere weather sides with the bull.

Agrural pegs Brazil soy havest at 35% for the week ending March 4, up 10% on the week and the slowest pace in 10 years. Last year’s harvest pace was 49% on this date. Only 54% of the safrinha corn has been planted across the county’s center-south, up 15% on the week but trailing the 80% pace this time last year.

 

Overnight, the corn market received its weekly Sunday night gap higher, and subsequent dawn ‘reversion to the mean’, ultimately finishing 3-4 cents higher in old crop and 2 cents higher in new. Overall, old crop futures put in a ten cent nightly range, never trading lower. Continued sub-optimal weather in South America, combined with gains in related/adjacent markets (particularly veg oil) helped rally the markets early, while a rising Dollar and wetter forecasts in parts of Argentina likely tamped prices back down again. We also have a USDA report due tomorrow morning, which will attract some market positioning today. Usually, the March WASDE is a subdued affair, and we have no reason to suspect any major changes. In this day and age, though, there is always the wild-card of a China S&D revision, given continued arguments over just how much corn they have left in stock? Of greater significance, of course, will be the Quarterly Stocks and Acreage Intentions data due at the end of this month. Warmer weather in the U.S. South and Plains will likely also get farmers excited about spring planting? Still no deliveries against the March futures contract, which expires Friday at noon.

 

Darren, David, and Elizabeth

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