Grains Continue to Trade in a Narrow Range

Grains continued to trade in a narrow range with only soybeans showing any sort of real directional bias in the night session. Soybeans were up 4 cents a bushel, while wheat was up nearly 2 cents and corn posted a fractional increase. In outside markets, S&P futures and crude oil were modestly higher and the US dollar slightly weaker.

Dryness in parts of Brazil is becoming an issue as limited rainfall is expected during the second half of this week through the middle part of next week. Many center west and center south crop areas will experience net drying and some increased crop stress. The drier bias is then followed by increasing rainfall in the early days of January that, if it verifies, would result in improved crop and field conditions in the center south and north. Southern Brazil continues too wet during much of the forecast period. However, further south Argentina has had good weather for development of the corn and bean crop there.

Yesterday’s weekly export inspections report from USDA was mostly in line with expectations. Corn was able to exceed pre-report expectations 400-550,000 MT with 718,888 MT of exports. Wheat and soybeans were on par with expectations with soybeans hitting 1,463,167 MT and wheat a respectable 475,375 MT.

Crude oil was up slightly after testing an 11-year low on Monday. But, oversupply and a very mild winter is keeping the markets on the defensive. Heating oil futures weighed down the crude complex, hitting a new July 2004 low warmer-than-expected temperatures have hit seasonal demand.

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a dba of Foremost Trading LLC (NFA ID: 0307930)

—Cody Bills