Friday July 16, 2010

Corn closed firm on Friday on concerns about some forecasts for hotter and drier weather in the United States in late July and August kept away aggressive selling and lifted corn to a firm close. The world is enduring the hottest year on record, according to a U.S. national weather analysis, causing droughts worldwide and a concern for U.S. farmers counting on another bumper year.

Soybean futures ended mostly lower Friday, as the market consolidated in choppy trade following the week's sharp run-up in prices. The market staged a modest correction from Thursday's 2% gains, with traders reducing risk exposure heading into the weekend.

Wednesday July 14, 2010

Good afternoon bloggers! Today's heat index of 93 degrees tells me it's summer. Not only was the temperature a high for the area, the markets also finished up on the day. Corn, beans, and wheat were all up. Corn was up 6-9 cents. Beans were up 2-7 cents. Wheat was up 2-10 cents.

Nearby corn +9 cents @ $3.84
Fall corn +9 cents @ $3.96

Nearby beans +2 @ $9.97
Fall beans up +7 @ $9.62

Wheat +10 @ $5.59

Fund buying, weak US dollar, and lack of producer movement supported the market today. Technical buying was 'egged on' by a weak US dollar for most of the trading session. The market saw a nice rally last week, but not enough to shake producer bushels loose. It appears that there is still quite a bit of grain in producers' hands and they are waiting to see how far the rally can take them. There was also some talk this morning of China showing interest purchasing more US corn. Last year, China had a difficult time with crops. This contributed to over 1 million tons of corn from the US to China which was the largest in 15 years.

I think another reason for corn, beans, and wheat to find the green today was based on fears of weather. Europe, Ukraine, and regions of Russia are going through a tough time right with hot and dry weather. Forecasts for European wheat is down, Russia is going through a drought, and Canada is receiving too much rain. Though the Midwest has received a lot of rain in pockets across the region, the weather outlook is looking good for crops in the coming weeks. Rain is expected this evening and tomorrow. The weekend is looking clear and we shouldn't see rain until the middle of next week.

The Gulf is bidding +40 to +44 cents for US #2 corn. US #1 soybeans are getting bought at +92 to +98.

Stay classy Illinois,
Nathaniel Dubravec

Tuesday July 13th, 2010

The corn market today suffered from a better than expected crop condition rating of 73% G/E last evening when many traders thought the number would come in around 69-70%. Corn finished the day down 4.5 cents on the CBOT with cash corn on the Illinois river down 6-7 cents with a weaker basis. Barge freight has jumped about 80 pts all the way up to and over 400% with increased demand to move out the old crop ahead of good looking new crop. Corn ratings for this week are the highest since the record crop of 2004 with only Iowa lower than last year's record production. Corn pollination seems to be progressing nicely throughout the Midwest with temps staying in the 85-95 range and no 100+ readings in the corn belt. There is scattered talk of dry conditions popping up in the Eastern corn belt and that will be closely monitored as forecasts call for the highest temps of the year next week.

Soybean ratings were down another 1% and sit at 65% G/E providing support to new crop beans as they were up 3.5 cents and basis continues to be very strong on old and new crop. Not surprising, the rain plagued states of Iowa and Missouri have the worst rated beans at 69% and 44% respectively.

Wheat led the way higher today as serious concerns arise over drought and extreme heat in the former Soviet Union. We have seen reports that this year's drought is surpassed by only 5 out of the last 100 years! Locally, wheat harvest has almost finished with poor results on both yield and test weight.

Scott Meyer

Monday July 12th, 2010

Corn ended lower Monday as benign weather forecasts ease concerns about the U.S. crop. The market was lower throughout the session, and likely needs a weather scare to extend its recent rally. But forecasts call for average temperatures and adequate rainfall over the next few days. The crop is entering its crucial pollination phase in many areas, which goes a long way to determining a crop's yield. Technically, after the December contract failed to break through its May high on Friday, the market's upward momentum seems to be waning. One said that the 200-day moving average at $4.02 1/2 will be tough to pierce unless we start to have some serious problems with the crop. Crop progress report shows corn at 73% good to excellent, traders were expecting a slight decrease.

Soybeans ended mixed on Monday as old-crop contracts gained for an eighth straight session on tight supplies and deferred months fell due to weather speculation and some light profit-taking. You still have tight stocks, which is giving us the stronger up-front bean market, but at the same time harvest is not far away.