Corn, soybeans and wheat all saw a melt down heading into the weekend.
Darren Frye, Water Street Solutions, says the sell off in grains was tied to profit taking after some gains early in the week, but it was also tied to a little farmer selling and a change in the weather.
“The forecast is also calling for a little wetter weather, especially in parts of the Dakotas, Minnesota, Iowa and maybe reaching farther South and West than what was originally thought a couple of days ago,” he explains.
The models are indicating the heat ridge will break down midweek to allow for cooler temperatures as well. As a result, Frye says the market removed some weather premium.
Corn and soybeans did technical damage on the daily charts, according to Frye, but if forecasted rains don’t materialize the markets could shoot back higher Sunday night.
“We had a pretty bad close today if you look at the daily charts. We were up on the week, surprisingly enough, but not by much ... 5 cents in corn and 12 cents in soybeans. Obviously if we had immediate strength on Sunday night because of weather or something else you could negate the negative action of today, but I think I’d be looking for new lows in these markets unless we see a quick turnaround.”
A bearish ruling against biofuels and Small Refinery Exemptions also pulled down corn and soybean oil.
Both classes of winter wheat made new contract lows and hard red spring wheat was also lower under the pressure of ample supplies and better yields.
