AFB Grain-Soybean Close: Continued Big Gains
Soybeans posted big gains today, with November gapping higher. The crop is faring very well these days. The weekly conditions report for the week said that 67% of the crop nationwide is in good to excellent condition. While U. S. soybean stocks remain historically tight, large world stocks could limit the upside potential. Today’s chart action looks to confirm that November has found support at $12.28 for the time being. The market was due a corrective bounce as futures had become oversold. This could be a pricing opportunity, as USDA currently is estimating the average on-farm price for 2013 soybeans to be $10.75.
Wheat prices closed the day higher, as wheat exports are beginning to show a little life at the same time crop conditions for some of the later winter wheat areas is beginning to decline. Large sales to China, combined with news that Argentina is banning exports and Russia crop is smaller than previously forecast, all are supporting gains in wheat. While wheat prices are showing strength today, prices will come under pressure if corn and soybeans turn around. July wheat closed just above support at $6.75, given that the market remains oversold wheat could try a move towards $7 ahead of Thursday’s USDA report.
Corn prices have recovered all of their losses since the USDA released its acreage report at the end of June. New crop contracts jumped between 16 and 21-cents as weather concerns dominate the commodity news. The 10-day forecast is calling for above average temperatures across much of the Midwest as the crop there begins to pollinate. Additionally one has to wonder if the market has finally digested the Acreage Report and has its own estimation of what harvested acreage will be. The good news for growers is that with the current threats USDA is less likely to adjust yields higher as the weather just 10-days ago may have suggested. During the next few weeks expect a lot of volatility in this market as traders react to the daily weather reports. Prices broke through the down trendline and closed above long term support in the $5.17 range. Prices are poised to test the $5.35 area where it has found resistance in the past; if prices mover to this level take an opportunity to price some of your remaining grain. December corn prices in the $5.30 – $5.75 range will be good pricing opportunities as we wait to see where this crop comes out. If temperatures remain high and moisture low, prices could move closer to $6, but if temps cool and the crop gets a timely shower or two prices will move towards $4.50 – $5 range.
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|New Crop||Stuttgart: 14.50/cwt||Pendleton: – – –|
This week’s news in agriculture from Agfax Media.