Lower grains start likely, traders await Obama speech

A mostly lower start is likely this am, 6-7 in beans, 1 in corn and steady/easier wheat. Egypt is in the market for wheat but they probably won't buy any from us as other origins, such as the Black Sea, are much cheaper. The $ is steady this am, not providing any direction for the grains.

There is some trepidation on the part of the bulls in the market ahead of President Obama's State of the Union speech tonight (7 pm, US Central time). The President might pursue his previously mentioned proposal to limit bank's derivative trading activity, which might reduce the buying power of hedge or index funds in various commodities, including grains. Traders will be listening closely to the President's speech for more information about this plan.

Brazilian weather remains very favorable with scattered rain expected the next several days, favoring the northern half of the belt. Argentina remains hot and dry with temps over 100 degrees in some parts of the belt. More of the same is forecast the next 3 days. Cooler temps and scattered rain of up to 1/2" is forecast Saturday, mainly in Cordoba and northeast Buenos Aires provinces. Light, scattered rain is possible Mon-Tue next week. A pattern change appears in the long range forecast starting the second half of next week with wetter and cooler conditions currently predicted. This would be very welcome following the recent hot and dry spell.