Soybeans Rally with Lower Brazil Crop But is $12 Possible? Corn Ends Steady, While Cattle Recover
Markets Now Closing Markets 3-12-24 Video
Grains end steady to higher on Tuesday with soybeans the price leader on lower Brazil production estimates and weather, plus the rally in soybean oil.
Alan Brugler, Brugler Marketing says Conab lowered Brazil soybean production by 2.5 million metric tons and added to a hotter drier forecast that helped to trigger some buying in soybeans. However, soybean oil has been up sharply the last several sessions including a 118-point gain on Tuesday as that market is following palm oil prices which have been on the rise.
Funds are covering shorts with many soybean contracts above 40 day moving averages, but will they keep buying and push contracts above $12? He says funds want to exit short positions with this chart action, but farmers are selling on the higher days which caps rallies, so it is a continuous circle especially as prices ramp up to $12.
Corn ends off highs after running into chart resistance and with a pickup in farmer selling as futures approached $4.50. "Farmers need money to put the crop in this spring and pay other bills, so they are selling when the market rallies," he says. Plus, there is still a large percentage of corn in storage that needs to be sold.
Wheat ended mixed still absorbing the China cancellations, but Brugler says the lower Black Sea and European prices are capping technical rallies.
Cotton continues to rally with tight supplies as Brugler says USDA continues to lower yields on old crop. The new crop contracts are bidding for acres with December futures nearing 85-cents.
Cattle tried to recover with higher boxed beef values and a higher stock market, but can it negate Friday's reversals? Brugler says the tight supplies have not changed the overall bullish fundamental picture.
