Weather is again bringing strength to the grains. March corn was up 8 ½ cents at $6.52, March soybeans up 36 ½ cents at $12.33, and March wheat up 17 cents at $8.41 ¾.
Over the weekend Southern Brazil and Argentina continued to have hot and dry conditions which have helped push this market higher. The two-week outlook looks a bit drier again which is helping to provide even more support to this market. The rallies were unable to take out last week's highs, but we did see corn breach the 100 day moving average momentarily before giving up 11 cents of those gains (chart included below).
As the market continues to be flooded with poor conditions from South America, we also have a couple of major reports coming this week. The Quarterly Stocks report as well as the Monthly Supply and Demand report will both be released on Thursday. I have included the expectations below. If there are any surprises on the stocks data, our thought is that it will be on the amount of wheat being fed, or the rationing of corn demand from these high prices.
Report estimates are as follows (source Reuters):
Production range: 12.165 - 12.375
Average guess: 12.265 with a 146.163 yield
December USDA: 12.310
Production range: 3.010 - 3.200
Average guess: 3.048 with a 41.358 yield
December USDA: 3.046
Chart: March corn - we continue to find some resistance at that 100 Day Moving average. It may take a bullish report to bring us above those levels.
Chart: March soybeans - The 100 Day Moving average is currently at $12.50 and may be where we find short term resistance before the report.
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