Grains ended mostly lower on Friday with the soybean complex leading losses. John Payne with Hedge Point Global Markets says the biggest issues for the soybean market is Brazil’s soybean harvest and their collapsing basis and China’s weak demand. “I think Brazil is the reason we are lower with the anticipated value of supply and demand in the future. Plus, we’ve lost market share to China.”
However, he says traders also continue to sell the large carry in the soybean and grain markets. “The worry you have is the carry. The deferreds just continue to come down to trade with that front month contract. You can see the price go nowhere and still lose if you’re storing physical supply into the summer.”
Corn has moved sideways according to Payne, holding above long-term support and unable to take out $4.50 on the charts. “Corn has found its price and continues to bob around that level,” he says.
Wheat ended mixed but lost early gains on the lack of bullish news and Payne says the lack of demand as Russia continues to undercut global prices.
Plus, the whole grain complex saw risk off fund selling with bearish outside markets like crude oil and the higher dollar which reacted to the better-than-expected Non-Farm Payroll (NFP), which showed an additional 353,000 jobs.
