AM Comments 01/14/15
Wednesday, January 14, 2015, 7:01 AM
Submitted by: Dustin Weiner
The corn and soybean markets appear poised for another sloppy/weaker day as both markets work lower – trying to find support. The charts look a little broken at the moment, making it much easier to sell vs. buy. Open interest in both corn and soybeans is actually higher this morning, indicating that some of the recent selling are new short positions. Really, the overall dynamics of the market are starting to shift as energy prices continue their sell-off – making everyone nervous. Generally speaking, the corn and wheat markets are on the hunt for new demand while the soybean market is grappling with increased competition for exports on the horizon (South America’s soybean potentially record harvest). South American weather forecasts continue to be favorable with rains still in the forecast for the dry areas of Brazil next week.
The only positive note (and it’s a bit of a stretch) is that with this break, farmer selling has slowed – which should eventually firm basis levels in parts of the country. It appears that a change of ownership has taken place the last few days where funds/speculators are selling and end users are buying the breaks. Overall the view remains that rallies will find good selling interest and ultimately price downside is not yet complete.
Corn 5 to 6 cents lower
Soybeans 5 to 7 cents lower
Have a great day!