Soybeans make new highs 6/04/09

Published on: 17:10PM Jun 04, 2009
July 09 Corn
448 ½
+ 16
Dec 09 Corn
471 ½
+ 16 ½
July 09 Beans
+ 48
Nov 09 Beans
1081 ½
+ 34 ½
July 09 Wheat
635 ¼
+ 17 ¾
July 09 KC Wheat
+ 18 ¼
July 09 Min Wheat
761 ½
+ 28
July 09 Meal
+ 19.5
July 09 Oil
+ 1.09

Corn, wheat and soybeans all closed sharply higher. The grains were able to rally today despite weak exports sales and improved weather forecasts this morning. All of the commodities were sharply higher today and this “trumped” everything else. Money continues to pour into our markets and this is driving prices higher. Eventually the fundamentals will matter, but right now money flow is determining prices. No matter how you slice it, the markets closed strong today. Soybeans closed on fresh highs for the move and corn closed just below them. Wheat was the weakest today, but if more money comes in tomorrow wheat could certainly rally back to the highs. I do not know how much money will enter our markets, or how long it will last. If money continues to push prices higher and IF fundamentals continue to worsen, than cash will need to disconnect from futures. End-users are going out of business, and eventually something will need to change. If prices for beef, chicken and pork don’t rise and allow producers to “pay up” for high priced grain than cash prices will need to fall. If the market continues to rally because of “outside” influences, than futures and cash prices may head in opposite directions. Basis levels are very good for many areas of the belt. If your basis levels are good, I would avoid leaving your basis “open”. There is no need to take on the extra risk. 
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