AM Comments 12/17/14
Wednesday, December 17, 2014, 8:12 AM
Submitted by: Dustin Weiner
After starting slow last night, the corn and soybean markets are higher this morning, led by wheat. The wheat market has been on a bit of a tear lately as the uncertainty in Russia continues on. The corn and soybean markets have remained remarkably range-bound throughout all of this as wheat pushes higher. In the case of soybeans, the inability to rally is likely due to the continued focus on South American growing weather which has been great. The importance of those forecasts will really grow as the calendar flips into January (similar to our August, this is where the crop can really grow/shrink).
The outside markets are mixed so far as the dollar is rallying, crude is lower, gold is higher and the financial markets are trying to put in a much needed bounce higher. Corn and soybean basis feels weakish as gulf values are slipping. I’m hearing stories this morning that there was huge farmer selling down in Brazil yesterday as the currency markets remain volatile. Quick summary of the thought process: the Brazilian Real (Brazil’s currency) is sharply weaker vs the $US, and when corn and soybeans are priced versus the $US, they are getting more Reals/MT because of that – enticing them to sell. The risk for those farmers is that by turning those corn/soybeans into Real’s, if the currency keeps slipping their buying power will slip with it…
Corn 3 to 4 cents higher
Soybeans 3 to 4 cents higher
Have a great day!