September 14, 2012
Producer Marketing Manager
Overnight we saw follow through from the news yesterday of the Fed policy changes. The Feds new plan is to buy $40 billion per month of mortgaged backed securities while continuing with operation twist where they buy $45 billion of the long dated bonds. The idea is this will help the housing market and consumer confidence which hopefully leads to more spending and more jobs.
Corn: As of 7:45 Up 6
Corn market is posting a solid rally overnight drawing strength from a weaker US Dollar. Not a lot for fresh news as we get into corn harvest. Also may be seeing some spillover support from the rally in the wheat market.
Soybeans: As of 7:45 Up 11
Soybean futures traded lower most of the day and rallied into the close and have seen some follow thru in the overnight trade. Bean harvest is just getting underway and the next 10 days look very favorable for good harvest progress across most of the corn belt. We have talked before the about how the US soybean export program is at a record pace for sales this early in the year. The chart below shows current sales on the books as a percent of total exports for the upcoming year.
Wheat: As of 7:45 MPLS Up 9, KC Up 15
Once again wheat was the leader overnight as we saw Egypt buy more wheat yesterday from Russia, France, and Ukraine at values that were around 63 cents/bu cheaper than US offers for SRW. Also watching Australian dryness and its effect on their production and exportable surplus.