Grain Market Chatter Closing Comments 03/04/2015

Craig’s Closing Comments

March 4, 2015

I want to remind you that we will be having a marketing meeting in at the Agronomy Center in Bowdle at 3 p.m. this Thursday, March 5^th.  Hope to see some of you there.

Corn:

The weekly ethanol report was put today showing that we ground 97.755 million bushels of corn last week in the creation of ethanol.  This was less than the pace needed to achieve the USDA projection and heading into this week we now need to average 101.881 million bushels per week to achieve the USDA annual projected usage number.

Also adding some pressure to prices today was the thought that the higher dollar could lead to increased production in Black Sea region as well as South America and the EU.

At the current time two of my three technical indicators are bullish.  We continue to languish in a sideways market.

Soybean:

This market was driven by South American news and fund selling today.  The trucker strike in Brazil appears to be over for all intents and purposes.  The main road BR-163 is fully open for the first time since Feb. 17^th and traffic is moving.  With this increased movement comes talk of a big increase in Brazil farmer selling soybeans which of course added more pressure to today’s market.  The selling was aided by a stronger USA dollar and weakness in the Brazilian Real which combined to give farmers in Brazil the highest prices for soybeans they have seen in a while.

Meanwhile, in Argentine growers have announced that they will stage a 3 day strike beginning March 11th.  They are pretty darn angry about the 35% bean export tax that has been imposed on them and so are choosing to halt grain sales to draw attention to their situation.

With the Brazilian logistical crisis seeming to have reached a conclusion we saw the funds in as sellers today.  By noon today they had sold 5,000 contracts as they add to their already short position.

With today’s lower close two of my three technical indicators are now bearish both the old crop and new crop futures.

Wheat:

It appears to me that the thing that killed wheat today was a report out of Russia.  The 2015 Russian grain crop is now estimated at 100 MMT, the high end of recent estimates.  According to reports the reason for the increased production is that the winter kill areas were not bad as previously thought.  It is assumed that wheat makes up about half of this 100 MMT of production and when this news hit the trading floor bearish traders hit the market with a barrage that had it off balance all day.

At the present time two of my three technical indicators are bullish the Minneapolis futures while two of three are bearish the Kansas City May futures.