Grains finished slightly higher with March corn up ½ of a cent, March wheat up 6 ¼ cents, and January soybeans up 6 ½ cents.
Outside markets had large swings today but were overall supportive for grains during the trading session. For one there were rumors that Iran closed the Straits of Hormuz which sent crude oil to almost $4 higher on the session. About an hour later Iran denied the reports and crude came well off those highs. We also had the FOMC meeting today which made little to no changes on their statement regarding keeping rates low through 2013 as well as continuing with their "operation twist". By the end of the day the equities reversed and the dollar strengthened suggesting the overnight trade may be a little bit lower for grains than today’s settlements.
Forecasted rain events in South America do not appear to be providing enough moisture to change the current dryness concerns of the market. This may bring some additional support in soybeans especially over the next couple of weeks unless the forecast changes.
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
Chart: January Soybeans
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