Corn – 8 AM sales continue, ethanol expected strong again today, less spill over weight from beans
↑ 8 AM sales continue with yesterday showing a strong sales report of 692K, more is expected
↑ Ethanol moved higher for the 7th week in a row last week and is expected strong again today, possibly topping the all-time high for 1 week which is 1109K
↔Last night beans were quiet which lowers the amount of spill over pressure corn has seen lately
↔While most of the corn news has been supportive it has been pulled lower by corn/wheat setting back, the spill over influence is still not that large given that March is not far from 440 fair value
Beans – A small amount of rain added for ARG again, 1000 in Jan beans held after 3 tests
↔ARG is slowly seeing more rains appear in the 10 day forecast, BRA rains still continue as active
↑ The 1000 Jan level was tested 3 different times and held, this shows a level where we can expect support, any level under 1035 fair value should see support but 1000 makes a round number to buy at
↔Trade’s primary concern is slowed exports and we haven’t seen 8 AM sales recently to ease those concerns, any sales would likely add support or seeing tomorrow’s weekly sales at 1500K or more
↔Recent pressure is all about how China might slow imports of US beans, on a fundamental basis we would need to see 2 – 3 weeks of a slowdown in order to show the concern is warranted
Wheat – HRW rains increased slightly on the morning map, US dollar approaching 2 ½ year highs
↓ Rains were increased again for the upcoming HRW system, both coverage and totals now higher
↓ The US dollar is around 107 and the 2 ½ year high is 107.35, while most of the wheat pressure has been attributed to weather, if the dollar makes new highs it could become a larger factor
↔On a % basis the wheat is even more oversold than beans but the news continues bearish
Cattle – Mostly $2 lower cash trades yesterday, BB continues lower, futures pricing cash 0.40 lower
↔Yesterday’s PM BB was choice -1.33 select -1.26 packer BE at 185.93, packer cushion -$1.49
↓ Cash traded mostly $2 lower yesterday in NE, there were a few trades that were $1 lower and some that were $3 lower but we have seen enough trades to assume the average will be close to $2
↓ Even on seeing cash trade $2 lower futures finished yesterday still priced assuming cash only 0.40 lower, that shows there is more downside in futures just to catch up to the cash news
↓ At this point it is obvious that BB is continuing to move cash/futures lower, let’s keep watching updates on that report every day and remember that it takes 3 days minimum to suggest a turnaround