Grains and oilseeds were mixed Tuesday after trading both sides of the market. March soybeans were sharply higher at one point but closed 4 ½ cents lower at $14.13 ½. March corn finished 6 ½ cents higher at $7.30 ½ and March wheat was 15 ¾ cents higher at $7.82 ¾.
Wheat held the most support as colder temperatures in the US threaten production. The 2013 growing year has started out very dry and we just had a bullish acreage report so it isn’t very surprising to see wheat prices rally. We have recently become competitive again in the world market which is also driving price. Since today was the last day for the fund rebalancing the wheat strength could also be a result of improved investor confidence now that the index funds are no longer expected to be selling Chicago wheat.
Corn followed wheat higher and as I have discussed in earlier reports I believe old crop corn and wheat have the strongest fundamental story. Soybeans rallied right into the 50 day moving average before dipping back to negative territory for the day. Why exactly did we see the strength in soybeans yesterday? It could be that we were past the report and a major NOPA crush number and the bulls felt confident to get long again. The dry weather affecting sections of South America right now is not a major concern for production at this time. On a side note the Argentine Ag secretary is estimating corn production at 28-30 Million MTs which is up by 500,000 from the last estimate.
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March Soybeans were unable to close above the 50 day moving average (red line)
March Corn looks poised to try and test the 100 day moving average of $7.45 (blue line)
March Wheat is coming off of sharply oversold levels and is well below the major moving averages.
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