Grains Drifting Lower as Dollar Index Surges Higher

Corn, soybeans, and wheat are continuing to drift lower in the overnight session. Coming into the morning trade break corn is down 2, wheat is off 5 cents, and soybeans are down 5 cents. Today is first notice day for November 14 futures, please roll all soybean positions to the January contract.

Soymeal is drifting lower to unchanged this morning in a relatively quiet trade. The CME Group has raised soymeal margins by 25% for speculators and hedgers effective today, leading some trading to believe a further retracement will be seen. Higher margins force traders to liquidate open positions or re-margin existing positions. Many longs in the market may opt to liquidate their positions after a huge run up since early October.

Beneficial rains are expected to hit Brazil today through Wednesday in the key growing state of Mato Grasso. These rains are much needed as dryness over the last 30 days has forced many producers to replant soybeans. The forecast has turned slightly dryer for the 2 week forecast, and we will continue to monitor any changes. Argentina corn is off to a great start as the key growing state of Cordoba has received a surplus of moisture over the last 30 days.

The dollar index is surging another leg high this morning, trading up nearly a percent in the early going. FED comments on Wednesday got the rally started as the Federal Reserve announced plans to end their 6 year bond buying program. Gold and Crude Oil are both trading substantially lower, gold down 3% while crude is off a percent and a half.

—Cody Bills