Weak export sales reduced the early optimism in grains. December corn and December wheat contracts were hit hardest with heavy bearspreading across the board. Wheat has finished higher for 7 consecutive trading sessions and was "due" for a corrective trading session.
Still wheat remains well above the low end of its range as the drought continues to threaten winter wheat crops. We will have our next crop ratings report on Monday but we have had a month of record-low ratings during November. The outcome of these low ratings is still unclear as springtime weather is still paramount but the market agrees that it certainly can’t be good for production.
Weekly Export Sales
Sales were well below the average of estimates and the market had a hard time holding support for the rest of the day.
Estimated Range Actual
Corn: 400,000 – 650,000 MTs 263,500 MTs
Soybeans: 500,000 – 700,000 MTs 319,100 MTs
Wheat: 300,000 – 500,000 MTs 279,300 MTs
Soyoil: 100,000 – 150,000 MTS 121,500 MTs
SoyMeal: 100,000 – 250,000 MTs 365,100 MTs
Wheat and corn are both suspended in the same situation… they can’t overextend pricewise as they still need to compete in the world market. The market has already priced in the Argentine weather problems and the poor winter wheat crop conditions, now it is up to demand to keep the rally going. India has approved 2.5 million MTs for export and more may be on the way to weigh on world prices.
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