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Veteran Advisor

From the floor February 23

At the close:

The March corn futures settled 11 3/4 cents higher at $6.91 1/2. The March soybean contract closed 22 cents higher at $13.20.  The March wheat futures ended 3/4 of a cent higher at $7.63. The March soymeal futures settled $5.30 per short ton higher at $351.80. The March soyoil futures settled $1.03 higher at $55.02.


In the outside markets, the NYMEX crude oil is $2.91 per barrel higher, the dollar is lower, and the Dow Jones Industrials are down 93 points.

 

Grain prices rebounded from steep losses on tight supply concerns and a sharply higher crude oil market.

 

Mike

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At 12:20pm:

 

Crude oil pushes towards $100 per barrel. Anybody locking in fuel prices for planting season? Just curious.

 

Mike

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At mid-session:

The March corn futures are unchanged at $6.79 3/4. The March soybean contract is 12 cents higher at $13.10.  The March wheat futures are 18 1/4 cents lower at $7.44. The March soymeal futures are $2.10 per short ton higher at $348.60. The March soyoil futures are $0.63 higher at $54.62.


In the outside markets, the NYMEX crude oil is $4.16 per barrel higher, the dollar is lower, and the Dow Jones Industrials are down 92 points.


All markets are higher. One analyst sums up the market like this;  "Corn, beans and wheat all traded lower overnight, as pools of unsold long positions at limit down were unfilled and needed the overnight trade to get out. But, the break was hard from the Monday night high's, leaving more than enough month-end profits taken by the funds.This had prices turn up into mid-session.Technically, May corn needs a close over 6.80, May beans over 13.00 and May wheat over 7.85 to stay bullish on the charts. A close under this week keeps the break going."


Mike

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At 10:35am:
All markets trade higher. Separately, here are a few thoughts of mine. I don't normally do this. But, a friend of mine asked me what I'm hearing in regards to where the corn market is going. I thought if it's good enough for him, it's good enough for you. So, here it goes. I'd be interested in your perspective.

What I’m hearing is watch Saudia Arabia. If that country experiences an uprising, crude oil goes way out of sight, pushing up corn. Keep one eye on this ethanol thing though. Man, the market psychology will really get spooked if the government pulls support for this industry. 

The next shoe to drop, following the uprisings will be the March 31 Planting Intentions Report. The sleeper is this though, China is really short on corn stocks. They will need to start buying sometime. China buying U.S. Corn will fill that hole that the ethanol news could create. And then the market will trade planting weather. Overall, there is no talk of prices plummeting. The funds may pull some positions. However, they will start to put longs on to position themselves for the summer crop season, they always do. So, to answer your question, I see the cash market being just ok. But, the futures could offer you the best price going forward. You know when the pilot of a plane says that he’s turning the seatbelt light on so please fasten your belts, due to upcoming turbulence? That is where the market is. We are in very bumpy territory. You could see the market drop sharply. But, this is not your father’s market, as you know. So, we regain huge losses quickly anymore.

Mike

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At the open:

The March corn futures are 8 1/4 cents lower at $6.71 1/4. The March soybean contract opened 8 cents higher at $13.06.  The March wheat futures opened 12 1/4 cents lower at $7.50. The March soymeal futures opened $2.30 per short ton higher at $348.80. The March soyoil futures opened $0.21 higher at $54.20.


In the outside markets, the NYMEX crude oil is $1.91 per barrel higher, the dollar is lower, and the Dow Jones Industrials are down 45 points.

 

Mike

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At 6:30am:


Early calls: Corn 10-14 cents lower, soybeans 4-6 cents lower and wheat 12-15 cents lower.


Trackers:

Overnight grain markets=Trading sharply lower.

Crude Oil=$0.73 higher.

Dollar=Lower.

Wall Street=Seen opening higher, after yesterday's steep drop.

World Markets=Lower.

 

More in a minute,

 

Mike

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5 Replies
Senior Advisor

Re: From the floor February 23

Guess the sky didn't fall after all !

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Veteran Advisor

Re: From the floor February 23

MIke a couple weeks ago I stated to notice the dollar and grains diverge. If this trend continues of a weak dollar along with weak grains I would start to think the top is in. BUt then I read that ET is calling for an increase in yuield to 162 and it scares me that he might keep being wrong and we will have the mother of all droughts!  Best acvice right now is don't pee into the wind!  All other choices will be wrong!

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Veteran Advisor

Re: From the floor February 23

No sky falling in agriculture...period. The sky may be falling elsewhere, but not in this sector. I think prices are so high that even a 'limit down' day keeps them in pretty good territory. I'm reading this morning that China's corn stocks may be historically low, supporting the long believed thought of needed U.S. corn imports. Also, a world food buyer says he sees farm market prices leveling off but staying at these higher prices longterm. A Chinese Think Tank sees ag prices looming at their current levels. Most of these opinions are backed by the reasoning of high demand, more middle class people, and the uncertainty of crop-weather problems. Yes, we will build back-up corn and soybean stocks, and even higher wheat stocks. The difference is the increased population numbers and frankly more developing countries with consumers that have more food-buying power.

 

I just returned from one of those developing countries. I saw more people driving newer cars vs. my previous trip there. I witnessed more construction in small town after small town. The white table-cloth restaurants were full. The cities were bustling. I went to a farm show and the farmers were buying tractors and combines right there on-sight. Sidenote: I still believe Brazil has a long way to go to be ready for the Olympics. The point is, all of the aforementioned brings with it increased consumption.

 

Mike

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Contributor

Re: From the floor February 23

I read this a.m. where India farm minister calls for resumption of exports of wheat, rice, sugar.  Looking for a record wheat crop.  Maybe the world has been using the past 6-9-12 months to get food production up.  The best cure for high prices is .....

 

I suspect producers in the U.S. will do everything they can to take advantage (cure) high prices.

 

That is a good thing, yes.

 

Regards

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Frequent Contributor

Re: From the floor February 23

This is a great time for end users to buy old crop corn needs, a gift really. The lower prices go now, the more I believe corn will be unavailable in June at any price. Prices will shoot the MOON, no weather scare needed.

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