AM Comments 11/11/15
Wednesday, November 11, 2015, 7:11 AM
Submitted by: Dustin Weiner
The markets quietly traded higher overnight after a nasty day of trade yesterday which gave us a bearish USDA report that sent corn and soybean futures tumbling lower. December corn futures settled a penny and a half above the August low of $3.5750. While slow farmer selling (both before and especially after this report) could be viewed as a reason for the markets to catch and hold in here – the trade will be fixated on our pace of export sales (along with Brazil’s) and could struggle to rally. FYI - on a chart the next downside objective would be another 10-15 cents lower: $3.46 on the Dec board. Not pretty.
As for soybeans, the USDA has handed us a large carryout estimate here in the U.S., and unless that South American crop starts to receive threatening weather soybean futures could remain under pressure. Jan soybeans settled just a nickel above $8.50 yesterday, if there’s another leg lower coming - the charts would project prices to move down another 25 to 50 cents - into the $8.00-$8.25 range. With soybeans it is sometimes hard to trust early season carryout projections because over the last few years – they seem to evaporate. The culprits have been strong crush margins and strong exports (namely China). All of those things will be watched closely for price direction from here forward.
Corn 1 to 2 cents higher
Soybeans 3 to 4 cents higher
Have a great day!