We ended the month of February with many of our agricultural markets at or near six-year lows. In most cases our move to these levels has been gradual. In fact, soybean futures just logged their narrowest monthly trading range in a decade. Implied volatility has responded in kind with soybean, wheat and corn volatility all trading at multi-year lows.
World wheat production still sits at record levels and stocks remain at their highest number ever. Our price outlooks do look for a rebound of July wheat to test the five dollar level at some point in the spring but right now we do not have the fundamental or technical indication the market will reach to higher levels.
Wheat was lower as more problems surfaced with Egyptian Wheat deliveries and as demand overall remains bad. The market overall remains slow, with sellers still looking hard for buyers. India is likely to become a buyer soon as it looks like the uneven monsoon first year could have damaged production.
In corn, going forward, it can still be said that the worst potential news for this month was already seen last week Tuesday on the crop report where neutral to slightly bullish news could mean a move back to recent resistance.