Our office will be closed today at 3:00 pm for our staff Christmas party.
Grains Matter Chatter – Episode 230
Tuesday was a negative day for our markets. Harvest corn closed down 1 1/2, spot soybeans closed down 5 1/4, spot winter wheat closed down 5 and spot spring wheat also closed down 5. In the overnight trade corn and the wheat sector are positive with soybeans still on the negative side. Oil closed down $0.63 yesterday at $70.08 per barrel. It is stronger in trading this morning with it now valued at $70.58 per barrel. Our dollar had a high yesterday morning of $0.701 US and has trended mostly lower since then. This morning it is currently valued at $0.698 US. This is the weakest our dollar has been since March of 2020.
Yesterday was yet another negative day for soybeans. They hit a new low on the January contract before climbing back up some to end the day. The marketplace is focused on the weather in South America and the record crop being projected in Brazil. The USDA has this crop pegged at 169 million tonnes with some private analysts estimating up to 174 million tonnes. This is 20 million tonnes more then what was produced last year. As we keep saying the supply side is dominating and with numbers like this it is overwhelming the demand side.
The only real positive from the action in the markets yesterday was that they bounced back up some as the trading day progressed. All of our markets hit their lows earlier in the day and bounced back some before the trading day ended. Corn and the wheat sector have kept that positive vibe going this morning but soybeans have pulled back yet again.
A current bill proposed in the US Senate would include allowing higher ethanol blends in gasoline in the US. If this was to pass this could be a major support for corn prices going forward. It is unknown at this time what blend levels they are looking at however any increase should result in more ethanol usage which results in more corn being utilised to make the ethanol. All in all this can be a big positive for the corn market going forward.