AM Comments 12/08/15
Tuesday, December 8, 2015, 8:12 AM
Submitted by: Dustin Weiner
Mixed trade overnight with corn a little higher while beans and wheat were a touch lower. The outside markets are also mixed with a weaker $US, lower crude (again) and lower equities. Crude oil collapsed yesterday down to 6-year lows (!!) after news was released showing that OPEC will maintain their rate of production. This seems to be turning into a game of chicken.
The free-fall in soybeans yesterday can partially be attributed to the bill that shifted the biodiesel tax credit from the blender to the producer. While this might not seem like a big deal, the market is nervous that biodiesel production may slow down as the blenders lose incentives to blend. This type of news turned the charts bearish and the funds stepped in quickly and started selling things off, taking soybeans back below their 100-day moving average and back below the psychological support of $9 on the board.
For today, expect choppiness as the trade attempts to even up positions ahead of tomorrow’s monthly S&D report (released by the USDA at 11am). If we do see some major price swings today, it will likely be influenced by movements in the $US and/or crude oil. While the trade is not expecting fireworks in tomorrow’s S&D report, a couple key things to watch are U.S. exports (it feels like they could be cut back a bit) and South American production estimates.
Corn steady to a penny higher
Soybeans 2 to 3 cents lower
Have a great day!