Wednesday, October 28, 2009

The corn market opened lower today based on an improving weather forecast as well as continued recovery in the U.S. Dollar index. The market attempted to rally mid day before closing $.015 lower for the day. The current weather forecast calls for late week rains but a warm dry pattern to begin next week prompting ideas of improving harvest conditions. The market continues to debate the impact of the wet with widespread disease reports and below normal test weight indications, the trade continues to debate a wide range of crop production ideas. It will be interesting to see where the market evolves to on crop size ideas as we approach the November USDA production report two weeks from now. Will the USDA factor expected harvest delays and test weight issues into this report?

Soybeans also continue to see liquidation on ideas of improving weather forecast for more active harvest next week after late week rains end. Delta states, where harvest should have been rapped up a month ago, will have to withstand another pounding 2 to 4 inch rain system following seven weeks of rain before drier weather persists there. We are seeing many in the trade indicating the potential for the 150 million bushels of beans left in the field in the delta to be literally written off due to field damage. Here is to hoping that next week brings back the chance to get some beans out of the field.

Phil Farrell