Grains fail to see any follow through buying after the higher day yesterday with profit taking across the complex and a lack of supportive news.
Randy Martinson, Martinson Ag, also says rain chances in Argentina are weighing on futures, especially soybeans. “The forecast last Friday was hot and dry for Argentina which caused some buying in soybeans but that changed midday on Tuesday and so there is some premium being taken out of the market.”
Martinson says there was some farmer selling on the rally Tuesday and he anticipates more selling pressure heading into the end of the month, as basis fixed contracts will need to be rolled or executed on before March goes into delivery. March options also expire on Friday which often creates fireworks and positioning.
Base prices for insurance are being set and are well below last year with grain prices well off their 2023 highs. Martinson says, “For Minneapolis wheat from the summer high on July 24 prices on the March contract have plunged $3.08 1/2. March soybeans hit their summer high the same day and have dropped $2.68, while March corn hits its high on June 21 of 2023 and has lost $2.21 1/4.”
Live and feeder cattle futures have taken out chart resistance areas hit on Tuesday and are making new highs for the move again. Buying Martinson says is coming from lower feed prices and positioning ahead of the Cattle on Feed Report with expected lower placements. Outside markets are seeing weakness in the equity sector.
