AM Comments 3/12/15
Thursday, March 12, 2015, 8:03 AM
Submitted by: Eric Kist
The overnight grain markets were fairly quiet on low trading volume. At the 7:45 break this morning soybeans remain unchanged, and the nearby corn contract is lower by a ½ cent, following up yesterday’s gains, which were the result of fund buying and technical support, along with a bullish weekly ethanol production report, which showed an increase in production and a decrease in stocks, albeit slightly. The outside markets seem to have reversed course so far this morning, as crude oil is higher and the US Dollar is sharply weaker. Over the past week the $ has been screaming higher, almost to a near-parity level with the Euro, which has been bearish to all commodity markets. A move lower today, however, may provide a bullish factor to the grain markets.
A possible counterbalance to the Dollar’s bullish implications today may be found in the weekly export sales report, which was rather disappointing. Sales estimates for corn and beans were below the estimated ranges by quite a bit, and both soybean meal and soybean oil export sales were on the lower end of estimates as well.
Over the past few days several cases of Avian flu (bird flu) have been reported in several U.S. states, including Minnesota, Arkansas, and Missouri, which in no way will provide support to the meal markets. So far the impact of these cases has been limited, and no confirmed cases have been reported in Iowa yet.
Political unrest in South America is prevalent this morning, as Argentina farmers are in the middle of a 3-day boycott of grain selling, and Brazil is staging a national protest today regarding corruption in the Brazil government’s federally-owned petroleum firm.
Look for mixed to slightly higher markets today.
Have a good morning!