Macro markets drove the bus this week. The financial meltdown that started late last week saw the most dramatic drop on Monday, pulling the commodity sector along for the ride. In some instances, commodities will benefit from investors pulling money from the financial markets due to a sense of relative safety. No such luck this week. Why? It all goes back to China and the economic power. Economic trouble in China led to fear of reduced grain imports from the U.S. especially in the soybean arena. As a result soybeans took the brunt of the bearish fundamental blow early in the week. However, once the financial markets began to stabilize, so did the grains and soy complex. For the week, December corn was down just over two cents while November beans managed to lose just four cents.
Through all the board volatility basis remained peppy during the week. Cash movement has remained very slow over the past 30 days which has kept basis supported for the old crop time frame. Soybeans have enjoyed the most strength with substantial premiums paid to those with trucks and beans ready to roll. New crop beans have shown some signs of strength as well, despite what many predict to be a near record crop just weeks away.
As we look ahead to the new month, the USDA will release the latest S&D table on September 11. We should start to see private estimates roll in next week as well as some early harvest results from the Delta… just enough to fuel the yield debate fire for a few more days.
CHS – Rochester Grain Team
Kasson: 507-634-7545 ext 7
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