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Closing Comments

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Closing Comments

Spread unwinding between soybeans and corn/wheat was prevalent today, while soymeal helped bring soybeans off their daily lows. 

US Climate Prediction Center in their latest update says that the bureau in now on La Nina watch and added that conditions are favorable for development during the 2016 summer in the northern hemisphere.

Brazil’s Senate will need to have 54 votes to remove current President Rousseff at the conclusion of the impeachment trial and the Vice President Temer would replace her if convicted.  President Rousseff  has said that she would not give up and that she is confident that she will win her fight against impeachment and plans to use all means necessary.  The recent uncertainty has played havoc with the Brazilian Real, but has attracted more business to the US for exports. 

Corn rebounded with a few more comments coming that it would possibly lose more acres over the next few weeks, especially in areas that are being delayed by saturated soil conditions and more rains in the forecasts.  Export sales this morning were strong again, and showed 49.4 million bushels of new business, within expectations.  Also, Saudi Arabia bought 8.3 million bushels in a private sale announced this morning as well.

Soybean backed off today, albeit only about .05 -.06 lower when they were down around -.16 at one point today.  Weak export sales of only 8.0 million bushels in soybeans, when expectation were closer to 25.0 – 36.7 million bushels inspired some profit taking.  The recent run up of the corn / bean ratio was seen as another reason to take some money off the table for longs, and again more hints of acres switching to soybeans were in the trade as well.  The current guesses we are seeing the most for acres being turned from corn to soybeans would be 1 -2 million at this point.  Soymeal still showed a lot of strength into the close today and may not be ready for a break just yet, and is the one to watch going into the weekend.

Wheat showed some better than expected export sales this morning at around 25.0 million bushels, while the expected range was between 9.2 – 18.4 million bushels.  Given the large net short positions held by commodity funds, short covering rallies can be expected in the near term and if corn decides to start working up.  South African Crop Estimating Committee thought the country’s 2015 final winter wheat crop estimate was around 52 million bushels, off 18% from last seasons.

Cattle and feeders traded in a mostly lower today with higher corn and wheat prices wanting to limit to many early gains, while optimism of rising retailer and consumer demand helped rally initially this morning.

Hogs modestly higher today on persistent demand from pork packers and gains in wholesale pork prices.  Average hog prices in Iowa and Minnesota late yesterday had hit their highest levels since last August. 

Closing Market Snapshot

 

 

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