AM Comments 02/24/15
Tuesday, February 24, 2015, 8:02 AM
Submitted by: Dustin Weiner
The corn and soybean futures markets spent most of the overnight session trading at higher levels, and were still higher when the markets paused at 7:45am. The trade is starting to show concern over the escalation of the Brazilian truckers’ strike which has spread to 7 states. It sounds like the strike is starting to have an impact on soybean transportation and from what I can read – there is no sign of a resolution.
Weather in South America generally remains favorable. Rains earlier in the season have kept the soybean harvest behind its normal pace (25% complete vs 41% on average). That should start to pick up with recent nice weather, but the concern is that their “second” crop of corn (they double crop down there) will be delayed which could chip into Brazil’s total corn production. None of this is overly concerning (there’s plenty of corn in the world) but with Chinese markets closed for the Lunar New Year Holiday and no fundamental news coming out of the U.S. – it is all we have to talk about. Also, the assumption is that with the recent pressure on South American prices, when China returns from holiday all business will shift to SA origins (could be a little bearish to US prices).
The outside markets aren’t offering much direction this morning, but they are probably viewed as a little friendly: crude oil and the U.S stock markets are called higher while the $US is a touch weaker. If that all holds, it could be enough to keep our grains/oilseeds higher for the day. After all, if the recent down/up/down/up/down trend continues… we are due for an “up” day, right?
Corn 1 to 2 cents higher
Soybeans 7 to 10 cents higher
Have a great day!