What started out as a quiet trade quickly evolved into a frantic buy buy buy session. Around midday grains shot higher on rumored strong sales to non-traditional buyers. Grains have struggled as of late, but todays trade showed a glimmer of hope. Harvest from N Brazil is heating up and yield data will soon make its way to news wires. It will be interesting to see if we can get any sort of follow through from the bulls in tomorrows session.
The market stabilized today as low volume trade held futures in positive territory. Spotty showers have dotted Brazil, but many believe rain totals are still too low to reverse drought-stricken soils. Outside news still remains absent as the shutdown continues. Locally weekend snow estimates have been reduced (but still sizable) as the storm track looks to have shifted south in the latest model runs. Logistics for end users could become complicated if a big storm materializes and disrupts the supply chain. Over the years this has yielded some quick ship premiums to keep operations going. Weather will be the main feature heading into the weekend for the U.S. & S.A.
Markets took a beating today as futures ran deep into the red. Key technical levels have been breached leaving the door open for continued selling in both corn and soybeans. The lack of information on trade deals, reports, and sales is really starting to take its toll on the market. They say bull markets need to be fed but with the lack of any meaningful information its sending them to the sidelines. The big news story for those in the Midwest is the forecasted snow storm later this week. We are seeing some estimates as high as 12-15 inches of snow followed by bitter cold temps. This would stop almost all grain movement in the short term if realized. Stay tuned for updates.
Early market strength faded as selling developed on the exchange pushing futures lower. Soybeans were the downside leader closing 6.75 cents lower. Export sales are really lagging in the soy complex and are off just under ½ of what we saw this time last year. When plugging this number into the balance sheet it paints a bearish picture. The big unknown is the S.A. weather. If the current weather pattern doesn’t change problem areas will be expanding and the market will need to account for the shrinking crop. Keep an eye on the weather locally as a potential large snow storm looks to be developing.