The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
The Grain Hedge Team provides a macro-focused daily view of the world’s grain markets. Kevin McNew received a bachelor’s degree from Oklahoma State University and his master’s and Ph.D. degrees in Economics from North Carolina State University. He spent 10 years as a Professor of Economics with the University of Maryland and Montana State University focusing on commodity markets and is widely regarded for his ability to boil-down complex economic situations into easy-to-understand concepts for applied life.
Grains posted positive gains overnight with soybeans leading the markets to the upside on a 12-cent advance. Corn and wheat prices followed with modest 1-cent and 4-cent gain, respectively.
Beans moved higher as patchy rains in Argentina have done little to stem the hot and dry conditions plaguing the crop there. The outlook for the next 5 days shows little chance of significant rainfall in key growing areas of Argentina, instead rains look to be more on the western edge of Argentina where crop production is limited.
In wheat, Egypt bought 60,000 tons of US SRW wheat over the weekend. In addition, Russia is considering a proposal to suspend a 5% grain import duty until Aug. 1, 2013 which would allow more imports from the EU. Growing conditions in the Plains continue to be bleak. While precipitation seems likely over the next week for the Delta region, much of the HRW wheat territory will likely not see any significant moisture.
For corn, prices continue to slowly inch up reaching their highest level in 7 weeks. But, the lack of any real demand stimulus from exports or the ethanol sector has kept prices from catapulting higher. Even with concerns of dry conditions in Argentina, chances are they will still produce a record-large crop keeping US exports out of the global marketplace in the last half of the marketing year.
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