Grains Start, End Week on Negative Note

September 16, 2011 10:31 AM

This information is provided by Archer Financial Services, Inc., 800-933-3996.


It was a negative week in the grains across the board. The week started with a rare Monday release of a USDA monthly Supply and Demand report, with its latest production estimates also included. Relative to recent reports, Monday’s data was sharply neutral, with both the corn and soybean production revisions mostly in line with pre-report guesses. This left the market with very little fresh bullish news that it needed if it were to immediately test and make new contract highs.

With the next production estimate nearly a month away, the market was vulnerable to a pullback and that is exactly what it did. As the combines began to roll in the southern part of the Corn Belt, early yield ideas began to climb. In today’s world with the advent of social media, information from the field arrives to the traders computers faster than ever. The combination of the void in fresh bullish news and stronger yields, led to a nearly 60 cent decline in corn from its weekly high.

A mid-week frost/freeze scare failed to excite the market. The general sentiment in Chicago was that very little damage had occurred from the unseasonably cold temperatures. However, some say there was indeed some damage done that may help to support corn and soybean prices in the coming weeks, as that is discovered. Expect end users to extend coverage and support the markets next week. As we approach the October production estimate, look for December values to climb back toward the $7.50 level with updated acreage data being the wildcard for the market.










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