Corn Closes Sharply Lower... Again

Published on: 17:47PM Jan 13, 2009
Mar 09 Corn
362 ½
-18 ¼
May 09 Corn
373 ¼
Jan 09 Beans
969 ½
+15 ½
Mar 09 Beans
971 ½
+5 ½
Mar 09 Wheat
570 ¾
May 09 Wheat
583 ½
Mar KC Wheat
Mar Min Wheat
+8 ¾
Jan 09 Meal
Jan 09 Bean Oil
Corn, soybeans and wheat closed mixed. Corn closed sharply lower once again and wheat and soybeans closed slightly higher. Old crop soybeans remained supported on continued worries in Argentina, but after being 70-cents lower yesterday still closed only 5-cents higher. Corn and wheat have the most bearish fundamentals right now, but soybeans are one large rain away from having another large break. With new crop corn and soybeans gaining a net 4 million or more acres this spring, they should take turns breaking. Last month Informa estimated a large switch from corn acres into soybeans acres. However, that number was derived using the high fertilizer prices from last summer. Now, with fertilizer prices falling in most areas of the country, soybeans needed to rally against corn to keep the acreage mix unchanged. As more and more people sit down and figure out that we have too many total acres, new crop corn, soybeans and wheat should continue to come under pressure as we head into planting. The only way to keep stocks from building any further is to pick up demand. Corn and wheat will need to keep breaking until demand recovers. Right now, it looks like all three will need to take out their lows in order to achieve this. The one exception could be old crop soybeans. Demand from China has been a record for soybeans; the question is if it will continue after their new year. If it does, old crop soybeans should continue to gain on new crop soybeans, corn and wheat.
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