October 17th, 2013
Drew Johnson
Grain Originator

The Government is back online!

Corn as of 8:00 am 1 higher.

Corn managing to hold its own as trade is torn between a possible large crop, and China and Mexico actively purchasing US corn. Still, there seems to be more against this market than there is for it, long term. Traders sit and wait for the government to get back online. A judge in Mexico has outlawed the use of GMO seed corn in the entire country. USDA is looking to announce, towards the end of the week, if it will cancel the October report all together, and then just wait until the Nov report. If so there will be a lot of information to digest which could mean very, very volatile markets. Informa Group will estimate 2014 expected acreage this Friday. From what I have heard, there is going to be less corn acres. Technically speaking support at 4.32 futures with resistance at 4.60.

Revenue Insurance Price discovery is at $4.41.

 

Soybeans as of 8:00 am 5 higher.

China is still actively buying bean, but without information, through government reports, there is little to go on except rumors and little pieces of information here and there. Basically let’s buy the rumor, sell the fact. It shall be interteresting what will happen when the “facts” start coming out. Informa is going to estimate 2014 crop acreage on Friday. From the sounds of things, there is going to be more corn acres switched over to soybeans. Brazil soy planting is expected to be up 4.6%, with total production up 7 mmt. Argentina production is estimated to be up 5 mmt. South American logistics will be the only positive in this market as we go through next summer. Technically support at 12.62 futures.

Revenue Insurance Price discovery is at $12.81.


Wheat as of 8:00 am Spr. Wheat 4 higher.     Win. Wheat 4 higher.

Wheat fell sharply yesterday lead by the KC futures. Good winter wheat planting/growing conditions are putting pressure on the wheat markets. The winter wheat crop is being planted into good moisture conditions and is expected to be in very good to excellent condition. We, of course will not find that out until the government gets reports moving again. Corn is also putting a little pressure on the wheat market. Corn, as feed, is cheaper than wheat right now.  Support for Spring and Winter Wheat is around 7.50 futures.