AM Comments 07/13/16
Wednesday, July 13, 2016, 1:07 PM
Submitted by: Dustin Weiner
We had firmer markets overnight last night – once again led by a soybean market that won’t stay down. The main story here is (of course) weather as continued chatter about a “ridge of death” or “dome of doom” gives the bulls something to chew on. From Wikipedia (for non-weather geeks): A ridge is an elongated region of relatively high atmospheric pressure, the opposite of a trough.
So even though most of the Corn Belt saw favorable conditions for late June and early July – the next 2-3 weeks are forecasted to bring hot, dry temps and the market is reacting to that. Soybeans in particular are the most vulnerable to sharp price increases as the soybean balance sheet doesn’t have much room for error (with the corn acres we have along with some questionably firm demand, the corn S&D could survive a yield drag) and this could stretch into pod-setting. If this ridge A) does set up over a large portion of the Midwest as forecasted and B) stays there for longer than expected… Katie bar the door! The funds - who were so quick to liquidate their long positions - could have a change of heart, giving this market a much different feel.
Corn 6 to 9 cents higher
Soybeans 18 to 22 cents higher
Have a great day!
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