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Middle Tennessee | We had more news than usual today in the grains. Egypt tendered for wheat, and in routine response all the contracts closed at years-running lows. An inventory report from the Canadian government exacerbated the issue, with stocks higher than anticipated. French farmers are so ticked at the prices—and the fact that key silos aren’t accepting wheat for storage—that they took their tractors into public roadways as protest. Winter crop planting is approaching, and presumably the world needs a new crop, but you would not know that from the price. While Managed Money is short the wheat, they still hold an estimated 55k long contracts, and this market may be targeting every last one of them.
The extreme bearishness in wheat, and and an Informa yield projection, pulled again on the corn market, which put in its worst close this year. After several weeks of heavy liquidation and neutral price action, Managed Money is moving in short and prices are suffering. Soybean trade again looked technical today, in spite of daily and weekly announcements of enormous export sales. The beans did manage the second worst close in many years. However the positive news helped soybeans pull out of the recent downward channel, with the range today establishing higher highs and lows over Wednesday trade. Once again, the 10-day moving average was challenged, and held as resistance. I’m not sure which is more surprising: that new lows in corn couldn’t stimulate a challenge of yesterday’s low, or that the market closed in the red on the low of the range given the export news. Recall that the earlier soybean low was established into the long Memorial Day weekend, maybe we’ll see something similar for Labor Day.
Edited by LongKC 9/3/2015 18:45
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LKCW Nightly: 9-3
