This information is provided by Archer Financial Services, Inc. 800-933-3996.
The USDA report on Thursday managed to steal the spotlight to finish the week, but the first half of the week was squarely focused on the U.S. and global economic picture.
The grains finished last week and started this week by being lead around by the U.S. stock market’s historically erratic volatility. This was on the heels of the Standard and Poors’ downgrade of the U.S. credit rating. Following a 20¢ early week decline, December corn began to separate itself from the stock market by mid-week in preparation of Thursday’s USDA report.
The report showed an aggressive reduction in both corn and soybean yield expectations of 153 and 41.4 respectively. This lead to a limit up trade in corn and a sharply higher trade in soybeans. Neither were able to garner much follow-through strength on Friday as exhausted traders showed little interest in adding to positions.
The debate will rage on next week as to whether the USDA’s aggressive yield adjustments this week will represent figures closer to the final yield or if they are simply the first in a series of yield reductions. Look for December corn to test the $7.40-$7.50 area in the coming weeks.
(click the charts below to enlarge)