Tuesday, January 4, 2011

opening grain market comments 1-3-11

Markets are called mixed to weaker this a.m. behind weaker overnight markets and weak outside markets.

In the overnight session corn was down 1, beans where up 2, KC wheat was off 4, MPLS wheat was off 5, and CBOT wheat was down 1.  At 9:25 outside markets have crude under pressure down about 2.00 a barrel, the equity markets are near unchanged, the US dollar has firmed up a couple hundred points, and European wheat is down about 1 %.

It looked like the grains had a little follow threw on yesterday’s weakness in the overnight session.  European wheat weaker helped push wheat markets softer.

I ran late getting the comments out this a.m.; as markets have opened and at about 9:50; we have wheat down 6-8 cents; which is a dime off of it’s session lows, while corn is down 11-12, and beans are off 16-19. 
 Rather volitale markets that have seen many swings just in the first 30 minutes of trading.  With the market not really expecting this price action and the overall market sentiment rather bullish we have to watch out to see if we trigger additional sell stops or if we find some solid consumptive demand/support.

Basis for high pro spring wheat on the spot floor is very firm; while some of the other cash markets are a little on the weak side.  Watch out for the sunflower market as birdseed buyers are very quick triggered to pull bids in down markets; much like producers don’t like to offer much in up markets.

A break on the corn and bean markets before when we are suppose to see the index fund-reallocation does have me scratching head a little bit and probably throws ideas in the market direction up in the air; but that is what the market is suppose to do.  Perhaps the break is a normal correction and an opportunity to look at re-ownership strategies for producers or coverage if you are an end user.

update..........at about 10:20 we have seen wheat move back to  

near unchanged; now 15 cents or so off of it's lows

When looking at newswires that main headline is profit taking; which makes sense as depending on how one is accounting for tax purposes there are methods out there that are realized; so perhaps some didn't have interest locking in profits closing out the year and are choosing to lock in those profits to start the new year.

The price action today and yesterday should have some head scratching going on...........it appears maybe there is a little left to the wheat story while the price action for the row crops is still disappointing.

The action is telling me that for I really need to get marketing charact StraightShooter Joe; up rather sooner.  His plan is going to be rather straight forward and incorporate more traditional marketing approaches; the only exceptation is that he will have re-evaluate on his plan more then a normal marketing plan and he will use trailing stops along with target dates

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