Walsh Commercial Hedging 4/11/12
Apr 11, 2012
Good afternoon. The grains closed mixed after a quieter day compared to yesterday’s late day sell off. The outside markets were positive today since the Euro zone was on the back burner of any news headlines. May wheat finished the day up 2 ¼ at 628. Wheat was up 8 cents overnight as cold weather across the southern Corn Belt had traders worried about any crop damage. The 7-10 day forecast has warmer temperatures in the Corn Belt but it’s way too early to say we’re in the clear. May corn didn’t have the aggressive long liquidation selling like the trade witnessed yesterday after the USDA left its domestic corn stockpile projection for the end of the marketing year unchanged at 801 million bushels. The decision not to cut corn supply estimates might mean there isn’t a need to keep pushing prices to ration demand. May corn finished up 1 ¼ at 636 and new crop was up 3 ¼ at 546 ¾ for the day. If the forecasted rains fall across the Midwest over the next 6-10 days, it might have a negative effect on prices as it has gotten quite dry in a large portion of the Midwest.
The trade saw continued selling in the bean complex today as May beans finished 4 lower at 1422 and new crop was down 5 ¾ at 1359. May beans set a new high yesterday and closed lower with an outside day down which could be seen as a technical sign of a near term top. This is the third session in a row May beans have closed lower. Long liquidation selling emerged throughout the day even with the outside markets higher. The COT report from Friday showed a record high net long position from fund traders in meal and beans and the open interest for beans showed a new record high 787,472 contracts. This has the trade nervous over the possibility of a corrective break.
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