Grains Were Mixed in the Overnight

Grains were mixed overnight as wheat found modest support advancing 3 cents, while soybeans were off 3 cents. Corn drifted lower in relatively stable trade in the night session. In outside markets, crude oil started the week with a $1 a barrel loss while S&P futures were modestly lower.

Soybeans saw pressure from good weather prospects in South America. Dry weather across N Argentina (hot too) and S Brazil will give way to wetter conditions over the next 5-14 days. N and NE Brazil have meanwhile seen 125-300+% normal rains with drying beginning next week. Last week (ending Jan 21) saw vegetation deteriorate across much of Argentina and parts of S Brazil. Improvement was seen in Northern Center-West and much of Northeast and parts of Southeast Brazil. Widespread moisture during the next 7-10 days will help numerous areas.

For wheat, prices found support from a cold weather snap in Russia and Ukraine. However, with most areas seeing adequate snow cover the risk to the crop seems limited. Also providing support is a report that Russia’s Ag Minister may be considering limiting grain exports over concern about the country’s inflation and declining rouble.

In corn, India bought 250,000 MT of corn from Ukraine. Technically, the corn market seems to be holding up on the recovery from the $3.50 area. The corn market held its gap last week at $3.64 as we try to push through the $3.70 area. This should give us a bit more strength with a test of the December trade from $3.75 to $3.80. Expect that to satisfy this recovery. Weekly charts also show the $3.75 area key overhead. However, we need a close under $3.63 to shift back down.said oil output had reached a record high in December. Its fields in the central and southern regions produced as much as 4.13 million barrels a day, the government said.

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

—Kevin McNew