Today grain markets closed modestly lower with corn losing 11 cents and soybeans losing 15 cents. In outside markets the Dow Jones trying to consolidate after yesterday's rally and crude oil falling as much as 7% at one point during the session. All of this following the monthly USDA Supply and Demand Report released this morning numbers as follows:
Domestic Corn Carryout 1.74 BBU (1.79 Last Month)
World Corn Carryout 144.6 MMT (136.66 Last Month)
Domestic Soybean Carryout 185 Mil Bu (210 Last Month)
World Soybean Carryout 49.95 MMT (49.87 Last Month)
In my opinion what we should expect to see is some sort of sideways stabilization trade going into the North American planting season. If that all goes well, I would expect that the downside risk could open up substantially. Especially under the current economic climate. A real drag on the corn market is cheap feed wheat located around the world with the USDA pegging world wheat carryout up 30% at 155.85 MMT vs 120.13 just one year ago.
Jeff Neisler
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