Grains finished mixed with March corn down ¼ of a cent, March wheat down 1 ¾ cents, and January soybeans up 5 cents.
Dryness in South America is providing some support for beans. Corn and wheat held resistance into the close which may have been partly due to weaker outside markets as well as continued resistance from the bearish USDA report last week. The December Supply and Demand report showed increases in world carryout for both corn and wheat. China’s increased production was the main cause for the higher world corn numbers. For wheat the main increases in production could be found between the countries of Argentina, Australia, and Canada. These increases only highlight the fact that the world has options for feed products, and this can continue to put downside pressure on these markets.
Factoring in the sharp decline in outside markets today I would say that grains held up pretty well. The Dow Jones futures were as much as 275 points lower on the day and the Dollar was sharply higher. Crude oil was over $1.50 lower and gold over $55 lower.
As we get closer to January we could see some pre-positioning before the 1st quarter rebalancing by the funds. We also have the January Supply and Demand report and Quarterly stocks data coming around the corner and will have estimates as we get closer to the report.
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Chart: March Corn
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