What Traders are Talking About:
* Rains forecast for Argentina. Forecasts continue to call for a slow moving system to produce widespread rains across Argentina this weekend. The rains are forecast to move into southern Brazil early next week, although the driest areas of Rio Grande do Sul and Parana could again be skirted. Cooler temps are also expected as the rains move through.
The long and short of it: With rains in the forecast, it will be hard to attract buying interest in corn and soybean futures ahead of the weekend.
* Argentine crops update. In its monthly update, the Argentine ag ministry said Thursday corn yields could be trimmed by 20% to 50% due to the prolonged heat and dryness. But somewhat surprisingly, the ag ministry raised its corn plantings forecast to 5 million hectares from 4.9 million hectares previously. The ag ministry lowered its soy plantings forecast to 18.8 million hectares compared to 19 million hectares previously. Meanwhile the Buenos Aires Grains Exchange kept its soybean plantings forecast at 18.85 million hectares, but lowered its commercial corn plantings estimate to 3.7 million hectares from 3.74 million previously.
The long and short of it: The impacts of prolonged heat and dryness across Argentina continue to filter through yield and acreage forecasts.
* Currency traders cautious, as they watch Greece. Greece and its private debt holders resume negotiations today amid signs they are closer to a deal that will pave the way for new aid before 14.5 billion euros of bond redemptions come due in March. For the currency world, these talks are binary. A deal to fund Greece would be supportive for the euro short-term. But if talks fall apart without agreement, it would halt the corrective bounce the euro is currently working on.
The long and short of it: While current focus is mostly on Greece, there are still a lot of issues currency traders are watching in the euro-zone. The road to recovery in the region is both long and bumpy. As a result, many see the corrective bounce in the euro as short-lived.
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