Crude oil traded to its highest level since December on falling rig counts and continued fund buying.
Corn closes incrementally higher but on the lows of the trading session.
Farmer selling and profit taking weighed on the corn rally as the day progressed. Ample supplies to get sold before spring continue to weigh on rallies.
The size of the current fund short position and the reluctance of farmer selling at aggressive levels are likely to limit downside price pressure, but rallies continue to struggle ahead of the Wednesday supply/demand report and ahead of spring planting concerns. Trade anticipates an incremental increase in stockpiles Wednesday.
USDA export inspections jumped nearly 30 percent over last week, coming in at 37.5 mln bushels – above the largest trade expectation.
Soybeans higher on short covering but close in the bottom off the range on farmer selling.
USDA export inspections came in just above last week at 39.2 mln bushels – near the upper end of expectations.
Soybeans in the May contract ran into the $8.90 resistance and failed. Now the question is if the market sets back to fill the gap from last night before starting up again – or if funds will defend their short positions and find fresh sellers.
May soy meal had its second close above the 50 day moving average today – the first time the market has traded above that average since last October. Strength in the meal market will be important to provide support to the soybean futures.
Reports out of Brazil are for an effort for an organized trucker strike on March 11, however the recent strikes have failed to have the market impact of disruption of just a few years ago.
Funds were reported to be buyers of 4,000 soybean contracts.
Wheat higher on dryness concerns in the Plains.
Dryness concerns developing in the Plains and heavy rains forecast for the Delta provided short covering support in the wheat complex today.
Weekly export inspections came in at 16.3 mln bu, putting the pace compared from last year at just over -12 percent behind.
Southern and western Plains continue to deal with dryness concerns and looks to continues the next couple weeks. While it’s too early to call for yield issues yet in the Plains, the large short fund position should offer support to the market here as we move into the uncertainty of the growing season.
Closing Market Snapshot
All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.