A tale of two markets this week as corn struggled to trade higher, staying within relatively narrow six cent range all week.  Corn has also struggled recently with a lack of consistently strong demand.  After three solid weeks of export sales and ethanol grind, both dropped slightly this week.

On the other hand, soybeans had a strong showing on the heels of the short covering rally started late last week.  Further strengthening the soy complex was a surprising large soymeal export sales figure released yesterday.  The big sale could be a sign of steady crush going forward rather than declining numbers as has been assumed for the past several weeks.

The cash market’s response to this week’s board rally was mixed as well.  First, in corn, basis improvements were seen in some areas, but depreciation was seen as well.  Our sense is nearby logistics forced commercial movement to select locations which caused lower basis.  In general however, producer sales of corn was slow, which should keep a floor under nearby basis.  Soybean basis on the other hand, saw a much more pronounced deterioration.  Thus far, river terminals have been the strongest market in our region, however there is some indication that strength could be nearing an end.  Be prepared to see more basis collapse as both river and processor markets near logistical capacity.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

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CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

An updated look at the USDA Supply & Demand tables provided little excitement for the grain markets this week.  Estimated US carryout for corn was left unchanged, while US soybean carryout was raised 10 million bushels.  On the world stage, carryout was cut slightly for both corn and soybeans.  Overall, the report was viewed as mostly neutral.

Given the bearish fundamental picture was confirmed by the USDA, technical traders starting taking control.  A slight boost from fund short covering was extended by the tech traders, and a market generally looking for any reason to move higher.  Some key technical resistance levels were penetrated this week, and the strong close gives some hope for follow through next week.  While corn had a solid week both in old crop and new crop, new crop beans had a psychologically better.  November 2016 soybeans struggled to pierce the $9.00 mark on Thursday, and after two sided trade to start Friday, managed to close solidly above $9.00, at $9.06 3/4.  With the volatile, two-sided trade we have seen in recent days it is a good idea to keep active pricing orders for targets above the market.  You never know when they will hit.

Looking ahead, we are likely to hear more about planting pace for US crops, and how spring weather is going to affect production prospects.  Watch for steady futures will a lower bias, but also be wary of sliding basis levels.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.

The week started with a lower tone, following on the heels of last week’s disappointing trade.  However, to end the week, a spark was found, generally driven by fund money covering short positions.  Wheat was the first benefactor followed by soybeans on Friday.  Corn was the reluctant tag along Friday after testing recent lows mid-week.  In the end, corn closed down only fractionally, unable to sustain momentum from export sales and shipments.  Soybeans had a stronger week, closing up $0.15 on the week.  Even though we have already seen these prices, the rally sparked producer sales here in the US.  Luckily, however, basis was not immediately impacted by the rally and ensuing sales.  Steady basis is not likely to hold for long.  A lot of grain needs to move to market, look for basis to weaken as we move through spring and summer.

Further contributing to the late week rally was chatter of a adversely wet weather conditions in wheat country, although that was generally dismissed as too much concern too early.  Geo-political strife also was a factor today as Brazil saw their currency move higher and financial markets drop.  This is seen as holding back producers from making more sales.

Corn sales were respectable this week at just shy of 1.1 million metric tons.  Total commitments are still running at 66% of the USDA estimate.  Soybean exports were again disappointing, yet sales are still at 92% of the USDA estimate.

If you would like to receive the Weekly Grain Recap via email each week, just send Aaron an email and I will get you on the list. aaron.ulland@chsinc.com

Read Full Market Update

CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
Ostrander: 507-657-2234

This Material has been prepared by a sales or trading employee or agent of CHS Rochester and should be considered a solicitation.  The information contained in this presentation is taken from sources which we believe to be reliable, but is not guaranteed by us as to accuracy or completeness and is sent to you for information purposes only.  There is a risk of loss when trading commodity futures and options.  CHS Rochester bases its recommendations solely on the judgment of CHS Rochester personnel.