AM Comments 3/10/16
Thursday, March 10, 2016, 8:03 AM
Submitted by: Eric Kist
Corn and beans are on the defensive heading into today’s trade as the US Dollar Index is screaming higher this morning. News out overnight from Europe has spurred the strength in the Dollar, as the European Central Bank has reported that it will ramp up its economic stimulus actions, including further interest rate cuts (deeper into negative territory) and increased asset-buybacks (similar to the US Quantitative Easing in which the Fed bought back US Treasury bills). Altogether, this has the Dollar up over 1% against the Euro, and US stock indices trading higher as well.
Export sales numbers for the previous week were released this morning, and should not play a role in the direction of today’s trade, as corn, beans, and wheat were all reported in the middle of the expected range. It is interested to note that the USDA left its export number alone in yesterday’s monthly Supply & Demand report, despite the slow start to the marketing year. Overall, the USDA left the corn S&D completely untouched, with corn ending stocks remaining at 1.837 billion bushels. As for soybeans, the only real change was a 10 million bushel reduction in estimated soybean crush, as crush margins have come down from last summer’s all-time high. With the change, the updated soybean carryout number now is estimated to sit at 460 million bushels.
Heavy rains continue to hit the Delta region of the United States, with more rain forecasted over the next few days. Although it is still early in the planting season for the area, abundant moisture could very well delay some early corn seedings.
Corn: 1-2 lower
Beans: 3-4 lower
Have a great day!