From the floor May 14

[marketeye]

At 6:30am:

Early calls: Corn down 3-5 cents, soybeans down 8-10 cents, and wheat down 3-5 cents.  

Trackers:

Overnight grain=Trading lower.

Crude oil=Trading $1.58 lower.

U.S. Dollar=Trading higher.

World Markets=Lower.

Wall Street=Seen opening lower on an expected weak retail sales report. Also, the euro reached a 14-month low on the idea that fiscal reform in some euro zone countries may hinder economic growth.

More in a minute,

Mike

[marketeye]

At 6:30am:

Overnight, South Korea announced it will delay imports of U.S. corn, due to price. S. Korea says the corn is $10/$20 metric ton too high. They say China's corn purchases is pushing up the price.

Also, China officials are putting in measures to prevent feedmills from hoarding corn. Another sign of the level of corn shortage.

And, China's Ministry of Commerce boosted its soybean import forecast for May by 36% vs. last May.  China is now expected to import 4.79 million metric tons vs. 4.69 million tons.

Mike

[marketeye]

A Brazilian market analyst is telling area farmers that soybean prices will come back, but not for a few months. During a visit this week with about 150 farmers, the analyst says because of the world economy recovering and strong Chinese demand, soybean prices will return to levels of profitability for Brazilian farmers.  Reportedly, Brazilian farmers hoped to sell soybeans at $40 per bag this year, but have been receiving 25% less.

Mike

[marketeye]

USDA announces 100,000 metric tons of U.S. corn sold to Japan for 2009-10 delivery. What do you think, is this the beginning of more corn sales to come. Other than South Korea announcing a delay, it seems like people are lining up for U.S. corn.

Mike

[p-oed Farmer]

Gee..... S Korea sounds like India a few years ago when the price of wheat was @ 6 or 7 dollars and they were going to quit buying because it was to expensive...... They were then buying later in the year for 10 to 12 dollars a bu..... p-oed

[marketeye]

At the open:
The July corn futures opened 4 1/2 cents lower at $3.68 1/2.  The Dec corn contract is down 5 1/2 cents at $3.83. The July soybean futures contract opened 11 1/2 cents lower at $9.53 per bushel. The July wheat futures opened 4 cents lower at $4.75. July soybean meal futures opened $2.80 per short ton lower at $278.60 per short ton. The July soyoil futures opened 28 points lower at $37.77.

In the outside markets, the NYMEX crude oil is $1.07 per barrel lower, the dollar is higher, and the Dow Jones Industrials are down 113 points.

One analyst says that index and trend-following funds are selling crude oil, sending the grains lower with it. Traders are getting out of some of their long positions before the weekend. And that's  because Monday's opening is expected to be lower, due to improved crop-weather. Friday is a day that you set yourself up for Monday, if you are a trader. Other noise out there right now; China increased soybean import forecast for May, NOPA announced smaller crush amounts than expected. There is still a lot of concern about Europe's handling of some its country's financial problems. As a result, heavy outside pressure for the grain markets.

Mike

[marketeye]

I agree. They could end up paying more if they wait too long.

[SouthWestOhio]

So marketeye thinks corn is going up from here.  How high, market eye?

[marketeye]

I'm being told that towards the fall, corn could put on $1.00. Why? C-H-I-N-A and that stands for Corn Headed Into Northeast Asia!!

Mike

[SouthWestOhio]

Will corn drag the beans along for the ride?