Corn and wheat closed last week much higher, while beans managed to take the long way to close within a couple cents of where they started.
Lots of folks are scratching their heads as to why the corn and bean markets refuse to break after what seems to be a string of bearish news, with some trying to say it's an indication we must move higher. In reality, while it may be an indication we aren't going to put any new lows in anytime soon, it doesn't necessarily mean we have to put new highs in either.
Until energies, wheat, and vegetable oils break, we will continue to find buyers, while sellers will likely be found in corn and beans on moves higher.
Looking ahead, today we will be watching export inspections closely again as the Gulf continues to work its way back to normal capacity. Based on grain flow to our export terminals last week, large weekly shipments are likely to be seen.
We are starting to hear more Chinese purchases being made of beans out of Brazil for the Nov/Dec time frame. As we mentioned last week there is some concern now due to global shipping struggles and general sailing time that any bean purchases made from the U.S. Gulf at this point would put beans into ports during the Spring festival.
Reports of more cargoes being purchased out of our South American counterparts during what is traditionally the U.S. export window is not what bulls want to hear, but again it will take months to see whether these shifts in demand will have a significant impact on ending stock outlooks.
Wheat continues to trade to the high-side with Minneapolis breaking $10 on the front month, hitting its highest level since 2012. A cancellation of 1165 contracts from the delivery market in Kansas City wheat was considered a bullish development for both cash and futures as a desire to keep those bushels in the local cash market versus work them into the delivery market could be seen as an indication of demand.
Russia continues to dominate the wheat market as well as we work to figure out just how much they will have available to send into the global pipeline in the months ahead.
In addition to export inspections, we will be watching crop progress closely today as harvest is stalled across much of the Corn Belt. Traders are expecting 75% of the bean crop to be harvested, with 68% of the corn crop ran and 85% of the winter wheat crop planted.
Corn 2-3 higher
Beans 8-9 higher