PM Comments 2-5-15
Thursday, February 5, 2015, 4:02 PM
Submitted by: Eric Kist
Both the corn and soybean markets gained some strength today, as corn closed 2 cents higher and beans finished 9 cents higher. Funds were the market movers again today, as the US dollar declined, and both the stock market and crude oil posted strong gains, resulting in a net buying from traders of both corn and bean contracts.
As noted in the weekly export sales report, demand for corn has been average-to-good, but corn exports from the Black Sea region continue to undercut US prices. Over the past 24 hours, the Ukrainian national currency (hryvnia), dropped in value by over 35% (!), which will continue to make them aggressive sellers of both corn and wheat. In the soy complex, soybean oil posted a nice gain today, coming on the heels of the announcement from Indonesia that it will increase subsidies for biodiesel production, which will be a big boost in demand for palm oil.
Looking ahead to the upcoming weeks, the USDA will release its monthly S&D report on February 10th, and will have its “Outlook Conference” on Feb 19-20. While there has been rumors that production estimates for the Brazilian soybean crop may be reduced slightly, final production is still expected to be record numbers. Also, any reductions in Brazil’s production will most likely be offset by potential increases in Argentina’s production numbers, coming off of near-perfect weather conditions throughout the growing season.
Have a good night!