AM Comments 06/28/16
Tuesday, June 28, 2016, 12:06 PM
Submitted by: Dustin Weiner
It appears the soybean market is poised to put in another strong session as it was sharply higher overnight. There may be a couple reasons for this rally, first – some of the private estimates for Thursday’s Planted Acreage report seem to be a bit lower than what many had thought. The trade had assumed some larger increases in soybean acres due to the flat price rally we saw in soybeans ever since the March 31 Acreage Intentions report. Second, the currency markets are on the move as the Brazilian Real is up sharply (at its highest levels since July 2015) while the $US is weaker. This shift in currencies should help price US soybeans into the world market (although with the amount of exports put on recently, I’m not sure they needed the help). We will still need to be careful up here, with a report Thursday and a market that will start to thin out – if the chart decides to turn around it could turn ugly again quick.
The weekly crop conditions report was out last night and corn was once again unchanged in the good-to-excellent category while the trade was expecting a 1-2% decline. This is a bearish input (although it was ignored for the most part last night). Soybean G/E ratings dropped 1% which was in-line with what the trade was expecting.
Overall we look for a higher start to the day with all eyes preparing to focus on pollination weather once Thursday’s report is behind us. While we know that June hasn’t given the U.S. Corn Belt ideal weather – the crop potential is still out there and if July turns out favorable for crop production… the market could feel quite a bit different.
Corn is 8 to 10 cents higher
Soybeans are 20 to 25 cents higher
Have a great day!
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