Lower Crude Oil May Affect Current Trend in Grains
A higher start is expected this am, 5-8 in wheat and beans with corn up around 5. The $ is lower again this am, which is friendly for US grains as it makes US exports more competitive in the world market place. However, crude oil is lower this am, a negative influence for the grains, especially corn and bean oil due to their biofuel link.
Weekly export sales were slow for wheat at 262,000 tonnes, and oil at 1500 tonnes. Corn sales were in line at 612,000 tonnes, as was meal at 62,000 tonnes. Bean sales were very good at 894,000 tonnes, mainly thanks to China, who accounted for almost all the business. On top of this, the USDA just announced the sale this am of 116,000 tonnes of beans to China.
Rumors continue in Argentina today that the government is considering cutting the export tax on beans, currently at 35%. The government denies it is considering this but if they did, it would be bearish for US bean exports as a lower export tax would make Argentine bean exports more competitive vs US bean exports.
Technically, all the grains except oil have a bullish upward trend on the bar charts, which could promote some technically-oriented buying again today. Man bought about 10,000 of the $3.00 Mar corn puts the last two days.
Only light, isolated rain fell in parts of Argentina's grain belt yesterday with more of the same forecast today through Saturday. Temps are expected to remain above normal. However, cooler temps and better rainfall is forecast early next week with up to 1" of scattered rain forecast then in parts of the corn and bean belt. Brazil will see more welcome rain in the north early next week but southern areas will remain mostly dry, increasing the need for moisture there soon.
The threat of winterkill remains in the southwest winter wheat belt where snowcover is sparse. However, snow is forecast in northern parts of the belt today with more possible this weekend before dry weather returns the first half of next week. ---Vic Lespinasse
Weekly export sales were slow for wheat at 262,000 tonnes, and oil at 1500 tonnes. Corn sales were in line at 612,000 tonnes, as was meal at 62,000 tonnes. Bean sales were very good at 894,000 tonnes, mainly thanks to China, who accounted for almost all the business. On top of this, the USDA just announced the sale this am of 116,000 tonnes of beans to China.
Rumors continue in Argentina today that the government is considering cutting the export tax on beans, currently at 35%. The government denies it is considering this but if they did, it would be bearish for US bean exports as a lower export tax would make Argentine bean exports more competitive vs US bean exports.
Technically, all the grains except oil have a bullish upward trend on the bar charts, which could promote some technically-oriented buying again today. Man bought about 10,000 of the $3.00 Mar corn puts the last two days.
Only light, isolated rain fell in parts of Argentina's grain belt yesterday with more of the same forecast today through Saturday. Temps are expected to remain above normal. However, cooler temps and better rainfall is forecast early next week with up to 1" of scattered rain forecast then in parts of the corn and bean belt. Brazil will see more welcome rain in the north early next week but southern areas will remain mostly dry, increasing the need for moisture there soon.
The threat of winterkill remains in the southwest winter wheat belt where snowcover is sparse. However, snow is forecast in northern parts of the belt today with more possible this weekend before dry weather returns the first half of next week. ---Vic Lespinasse
posted by InsightPublishing at
8:44 AM
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