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More Active Weather Suggests Possible Change In Pattern

06:16AM Mar 04, 2013

What Traders are Talking About:

* Midwest braces for another storm. Snow began falling on areas of the western Corn Belt overnight and will continue through Tuesday. The early week storm is expected to come in two waves, with the first wave likely to be much lighter and milder. Blizzard-like conditions are forecast for tonight and Tuesday as the second wave of the system moves through. Another storm front is forecast to pass through the region late this week, though rain is likely instead of snow from that event as temps are forecast to turn warmer. The Northern Plains will be impacted by the early week storm, while the rains forecast for later in the week will originate in the Southern Plains and move northward, bringing the warmer temps.

The long and short of it: The more active weather continues to signal there's a shift in the weather pattern. That limits buying interest in new-crop corn and soybean futures and in wheat futures.

* South American watch continues. Dry areas of central Argentina and southern Brazil received rains over the weekend, with amounts and coverage levels about as expected. The forecast is mostly dry for Argentina this week, while southern Brazil is expected to see rain chances throughout much of the week. In addition to weather, soybean traders are keeping a close watch on the port situation in Brazil, as the wait time to load soybeans is growing by the day. The longer shipping delays out of Brazil last, the longer the export window for U.S. soybeans will remain open.

The long and short of it: The weather situation seems to have stabilized a little in Argentina and southern Brazil, but shipping delays in Brazil are supportive for old-crop soybeans.

* March S&D Report this week. USDA will release its March Supply & Demand Report on Friday. USDA is expected to do little more than fine tune its demand projections, as there will be no changes to U.S. production this month. The bigger focus is on global production, although any changes from USDA at this stage are seen as catch-up moves to private crop forecasts.

The long and short of it: USDA's March Supply & Demand Report is typically a relative non-event. Because corn and soybean ending stocks projections are so tight, however, a market-moving report can't be ruled out. USDA's reports at the end of the month -- Prospective Plantings and Quarterly Grain Stocks Reports -- are more likely to be market-moving.



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