Wednesday, December 15, 2010

market comments from 12-15-10

Markets are called mixed this a.m. behind a choppy overnight session as markets continue to move towards holiday mode in an environment that is lacking a little news. 

In the overnight session the grains started off and shown weakness for most of the session; but they did show some strength by the time overnight session was over or paused at 7:15.  At that time corn was up 1-2 cents, beans where up 5, KC wheat was up 4-5, MPLS wheat was up 6, and CBOT wheat was up 4.  The December contracts expired yesterday and with that we did leave a cap on the continous corn chart.

At 9:15 outside markets are mixed with equities firmer with the DOW up 28 points, crude is down about 40 cents a barrel, European wheat is up about 1 %, and the US dollar is stronger up 230 on the March contract at 79.920.

Weather still appears one of the main drivers, as does fund cash flow movement.  Many firms have put out their picks for 2011, most of those have included crude oil, soybeans, and corn as top investments or commodities that they project a increase in price in.  How accurate these will be only remains to be seen but how the funds decide to position themselves over the couple weeks of the year will help determine where we go to finish off the year.  Any major fundamental factor changes probably won’t happen until the January crop report; weather and pace of sales/demand will be important but the most likely to change the fundamental direction will be the USDA report in January as if I remember correctly it is a report that has moved at least one grain limit one direction or another for the last 3 years.

With a lack of news and yesterdays weakness many thought we could see the grains tail off right off of the opening; but after about 10 minutes of trading the grains have shown more strength then where they overnight session left off at.  Wheat and beans are both up 10-12 cents and while corn is up about 6 cents.  Generically speaking one thing I wouldn’t care to see is today’s bounce attempt fail.

The markets did slowly give the early gains back plenty of the early gains today; the US dollar showed strength and that lead to most of the grains closing under pressure.  Corn was down 3-6 cents, wheat as down 4 in KC, MPLS was down 1, CBOT wheat was down 2, crush sunflowers where off 20 cents, the DOW was down about 20 points, and the dollar is firmer up 900 points.

Not a lot of new news to report; but I did attach a couple of items.  One is some info from RJOMRT and the other has some trade thoughts/ideas on corn.

Wheat basis did feel better and I noticed the spot floor was firmer on high pro’s.  Birdseed buyers didn’t show tons of interest but have been calling a lot and leaving a sense that they need to buy.

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