Corn: This support from outside markets combined with hot weather lined up next week gave corn reason to rally. Good to excellent crop ratings, out this afternoon, showed corn fell 2% from last week. Given the exciting trade today we would expect traders to put a bullish spin on this as well. In the big picture you cannot argue much has changed from a numbers standpoint. We should expect these weekly crop ratings to fall for four more weeks as they seasonally do.
Soybeans: Last week’s big China purchases of US soybeans got the market going. The overnight support from outside markets and the forecast change continued that support. From a traders short term perspective this bullish news comes in front of USDA’s August report next Wednesday. It is likely old crop ending stocks will fall from 110 million bushels to 100 or sub-100 million bushels. We must respect the fact old crop demand is a little better than USDA has been expecting.
Wheat: Last week’s wheat tour results indicated a better than expected spring wheat crop out there. This morning’s news that the Argentine government will lift export limits on corn and wheat is also bearish. It had no market impact as they don’t have much wheat to sell but the gesture is something to note. The key thing we’re noting is short term wheat news is bearish. However, prices continue to be driven by corn and soybean prices right now…Rich Nelson
Rich Nelson is the Director of Research at Allendale, Inc. in McHenry, IL. Allendale is registered with the CFTC and NFA and is a member of the NIBA. www.allendale-inc.com
