Markets finished strong with beans leading the way. December corn finished 8 ½, January soybeans finished 24 ½ cents higher at $12.27 ¼, and December wheat 12 ½ cents at $6.36.
We started the day out stronger and with the ECB cutting their key interest rate by 25 basis points we found extra strength from the outsides. The Dow was up over 200 points by the end of the day and the dollar was sharply lower.
Export sales were rather weak for soybeans and at the high end of estimates for corn. Wheat was as expected.
Estimated Range Actual
Corn 375,000 – 650,000 MTs 622,600 MTs
Soybeans 400,000 – 800,000 MTs 209,700 MTs
Wheat 300,000 – 500,000 MTS 320,100 MTs
I have included our Supply and Demand estimates in the chart below. The main demand differences we have from the October report are the ethanol usage as well as the wheat feeding number. We still think the USDA is underestimating the amount of wheat being fed in the US, and we also feel the conversion ratio they are using is too low for ethanol production resulting in an overestimation of corn used. (see chart)
Until the November 9th Supply and Demand report the market could continue to chop around as it has over the past few weeks. Given the discount world grains have to undercut our prices, as well as the net long positions the spec longs are still holding, we like making sure the downside risk is well covered. To receive a two week trial of our services please contact an EHedger broker today or sign up using the link below.
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