Soybeans with the Biggest Loss in the Overnight
Apr 25, 2016
Grains were lower overnight with soybeans taking the biggest loss. In outside markets, crude oil and equity futures were also lower in overnight trade.
After Friday’s meltdown in the soybean market, prices on front-month May futures seemed to find support at $9.80 before the regular session open. However, news that fueled the rally over the past month seems to be waning in importance. Argentina’s weather woes look to be in the rearview mirror. Bean harvest was picking up in SW Argentina and receipts at port terminals are gaining to almost normal harvest levels. Weekend rainfall was spotty in Argentina with a few areas seeing a 0.50 inch, but most key areas were dry over the last 3 days.
In the US, rains were prominent in IA, MN & ND over the weekend bring an inch or more of precip, while the Southeast also saw large rain events. Rain looks to be prominent in the 7-day forecast with accumulations heaviest from IA to TX, and potentially excessive at times.
USDA will release planting progress today after the market closes. Average corn plantings on this date are around 25% and good weather last week may lead to a big jump in plantings to over 30%. Also, look for winter wheat conditions to improve on improved moisture in the Plains. Some producers in HRW country are talking yields 10% above last year.
Crude prices fell overnight following a report saying Saudi Arabia could maintain its total production capacity with the expansion of an oilfield, fueling fresh concerns about the global supply glut. Saudi Arabian Oil Co will complete an expansion of its Shaybah oilfield by the end of May, allowing the world's largest exporter to maintain total capacity at 12 million barrels a day, Bloomberg News reported. The expansion will see Shaybah's capacity rise from 750,000 barrels to 1 million barrels a day, the report said.
The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)