October 6, 2011
By: Craig Haugaard, Grain Origination Manager
CORN: 4 higher
The market surged higher yesterday on the renewed hope that the world financial situation is stabilizing. The prospect of a stabilized global financial situation propelled crude oil higher for the session and pulled grains to a higher close as well. For the session funds were buyers of 15,000 contracts. Mid-way through the session Informa released their latest yield projections and have corn pegged at 149.5 bu/acre. This was obviously higher than the last USDA projection of 148.1. It is interesting to note that in the past six years the October USDA report has come in with a number at or lower than the October Informa number. In addition to glimmers of hope concerning the world financial situation the market was also buoyed by persistent reports that we will see Chinese buying when they return from the weeklong vacation that country is currently enjoying. The overnight session traded higher in the expectation that the weekly export numbers would be solid. This morning they have been announced as 1.28 MMT. This was above the top end of trade guesses and should give us a higher opening today. Two of my three technical indicators are bearish and we appear to have very solid support at $5.75 in the December futures.
SOYBEANS: 11 higher
Beans had kind of a blah day, especially in light of the fact that the Informa report came in at a lower than expected. Coming in at 41.8 bu/acre the report was the same level as the last USDA report and was lower than what the trade was looking for. Over the course of the past seven years the Informa report has been equal to or larger than the October USDA report. If that were to be the case again this year it would be surprising indeed. For the time being two of my three technical indicators are bearish. The weekly export sales number came in at 701,000. This falls within the range of trade guesses but is less than the 947,000 posted for this week a year ago.
WHEAT: 8 higher
Wheat traded higher in sympathy with corn yesterday. The weekly export sales came in at 431,000 which was within the range of trade guess but well below the 808,000 posted for this week a year ago. Rains are still forecast for HRW country this week-end which should be great news for folks in that parched portion of the country but could ultimately weigh on the prices. Two of my three technical indicators are bullish the Minneapolis HRS wheat with two of three still bearish the Kansas City HRW wheat.
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.