Grains Rebound Overnight
Feb 14, 2013
Futures markets found support overnight as weeks of selling finally seemed to come to an end. After 10 straight days of lower closes, corn starts the trading session in positive territory with a 6-cent advance. Nearby bean and wheat futures were also up 6 cents.
Corn futures traded above $7 on the front month March contract. News of ethanol plants coming online again has helped reverse the trend of lower prices in weeks. But lackluster export demand should continue to keep prices on the defensive. Thursday’s weekly export sales were 225,400, up from the previous week, year-to-date sales are lagging last year’s total at this time of year by 53%. In comparison, USDA’s official export estimate for the year shows a 42% expected drop in exports.
In wheat, export sales were robust with a total of 706,000 tons, but several weeks of solid business will be needed to get traders excited about the prospects of improved wheat export business. In the US Southern Plains, there is a slim chance of precipitation today in Oklahoma and Kansas, but beyond that the 5-day forecast looks to continue the dry spell.
For soybeans, export business was noticeably lower than expectations on Thursday as numerous cancellations left old-crop bean sales at a deficit for the week. Weather in South America continues to be favorable as harvest there begins to pick up. Brazil’s harvest is 12% complete, above the five-year average of 7%.
Markets are closed on Monday for the President’s Day Holiday.