AM Comments 11/08/16
Tuesday, November 8, 2016, 1:11 PM
Submitted by: Dustin Weiner
Our markets this morning are higher with soybeans showing strong gains overnight on the heels of a strong trade yesterday. As has been the case lately, soybeans are being led by soy products – in this case, soybean oil. Soy oil is taking its lead from its Asian counterpart this morning, Malaysian Palm oil, which has moved into a new 2 ½ year high. The funds of course have not been ignoring all of this as they now hold a record net long position in soybean oil. This has improved the look/feel of the soybean chart as January soybean futures are now back above $10 on the board and are currently trading above the 100-day moving average. This higher move in soybeans is still a bit confusing to the fundamental trader as US soybean supplies seem to continue to grow and cash markets remain soft.
Corn… well, the corn market has been pretty quiet. As this big harvest slowly comes to an end there really isn’t much for new news to discuss. World grain stocks in general still look ample and without some sort of supply issue in South America, the corn market doesn’t seem to feel the need to move much from here at this time. So far, outside of some flooding in Argentina (currently a soybean story more so than corn), things are looking alright down there.
Today of course is election day in the US which could bring some interesting trade – keeping volatility on the high side. Once this is behind us, the grain traders will quickly turn their focus to tomorrow’s monthly S&D report from the USDA which could/should give us direction into the end of the calendar year. The market is expecting soybean production to rise (again) and if soybean futures are going to continue to trade at these price levels – we may need to see confirmation of this massive export demand also. Corn production estimates for tomorrow’s report are coming in unchanged to a bit lower.
Corn is 1c higher
Soybeans are 7 to 9c higher
Have a great day!
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