Afternoon Update - Wheat leads the charge again
Mar 19, 2014
It was all about the wheat market again today as additional stories of turmoil in Crimea/Ukraine spooked prices higher once again. The latest incidence reports that Pro-Russian Troops have overtaken a Ukrainian naval base. As I have commented, this situation will almost certainly give us knee-jerk reaction days like this, but also keep in perspective that if this is the only thing propping prices up, that is akin to making a bet as to if it will rain or not tomorrow.
The bean market was no slouch either today as we continued to correct back higher but the export sales in the morning could be a defining moment. Trade estimates range from a negative 100k MT to a positive 300k. There were additional stories about Chinese cargoes from South American being sold into the US markets and if sales come through in the negative column, I have to imagine that will really take the wind out of the bull’s sales.
Estimate for corn range between 400 and 700k MT and for wheat 250 to 500k.
EIA Ethanol production bounced back well this past week as we produced an average of 891,000 barrels a day, which should work out to around 94 million bushels of corn. Weekly stocks were actually down 27 million gallons as well.
Outside of happenings in Ukraine the focus after tomorrow should almost exclusively shift to the March 31st reports. If prices hold here or track higher between now and then, I suspect the numbers will need to be surprising positive or it could turn out to be a very anti-climatic event.