Morning Comments January 19, 2017
Thursday, January 19, 2017, 2:01 PM
Submitted by: Landus Cooperative
Overnight trade was relatively quiet and narrowly mixed with both corn and soybeans showing red on the quote screen this morning. Trading volume eased during yesterday’s trade and corn closed ½ cent lower ($3.65) on March futures and ¾ lower ($3.9175) on new crop. Fund managers were sellers at 2,000 contracts before lunch. The President of Mexico’s National Corn Farmers Federation stated yesterday, Mexico is estimating they will import 20% more corn from the U.S. this next year due to the weak peso and rising crude prices. Mexico has estimated projections for this year at 14-16 mmt and will increase to 16.8-19.2 mmt 2017/2018 year. Another week of record ethanol is expected in today’s EIA report but there are more questions than answers concerning the state of DDGs (and their effect on ethanol plant margins & corn demand). Corn harvest will begin in Brazil and Argentina in a few weeks and it could pull some demand from the U.S. – especially considering the U.S. dollar is near multi-year highs.
Soybeans posted gains again in March and November futures yesterday. March picked up 5 ¾ to finish $10.75 and November picked up 8 ¼ to close at $10.2825. March was at a 6 month high as funds continue to cover short positions. This rally is product of multiple market drivers, but concerns with an Argentine production decline due to overabundant moisture has been the pillar. However, there is growing concern that the market is becoming overbought. It’s important to remember that beans are up over 82 cents since January 9th.
Corn is unchanged to a penny higher
Beans down 5 – 6 cents
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