November 1, 2011
By: Craig Haugaard, Grain Origination Manager
CORN: 13 lower
If you are a bear yesterday seemed to have it all. We had month end profit taking, the weekly export inspections number was once again less than last year. Thus far for the year export inspections are running 24% behind last years pace. News out of Europe had nervous traders looking at the dollar as the safest bet in town so the dollar was higher yesterday which also put pressure on commodity prices. We also have some traders a little nervous that the November 9 report will show than larger than expected national average yield. We will see the FC Stone production estimate today and Informa will release theirs tomorrow so we should soon have a pretty good handle on what the USDA will tell us. Technically, two of my three indicators are now bearish but as you can see on the following December futures chart we are really in a sideways trading pattern and will need fresh news of one type or the other to get us to break up or down from this level. Maybe the USDA report will provide that impetus.
SOYBEANS: 22 lower
Larger South American stocks are doing a number on our exports as weekly export loadings are running a huge 37% behind last year’s pace. The USDA is projecting that we will be down 8% for the year so we need to get in gear pretty soon. This slow pace may be noted by a reduced export number in next week’s USDA report. If the national average yield remains unchanged this would of course cause the projected ending stocks to increase. With 87% of the crop harvested the November 9 USDA report should have a pretty good handle on the national average yield. We will also want to keep an eye on Europe as every tremor or fear on that continent sends folks running to the perceived safety of the USA dollar and of course that tends to be negative to commodities. Technically, two of my three indicators are bearish with support showing up in the November futures at $11.52.
WHEAT: 9 lower
A strong dollar and large world supplies have kept some pressure on the wheat market. It is interesting to note that the past couple of years we have had price levels that are fairly unprecedented based on the supplies we are dealing with. If we ever go back to historical supply/price relationships we could see wheat go much lower. In the near term we will want to keep an eye on how the moisture in the southern plains develops as well as continuing to see if the black Sea region keeps dumping cheap wheat in the world market. Technically the charts remain in a sideways pattern.
The information contained above was taken from sources which Wheat Growers believe to be reliable, but is not guaranteed by Wheat Growers as to accuracy or completeness and is made available for information purposes only. There is a risk of loss when trading commodity futures and options.