closing grain market comments ahead of the USDA Crop Report for March 31st - Acre and Stocks

Below are short closing comments as well as some info ahead of tomorrow’s USDA report which should help stages for fundamental price direction.

Today corn closed down 9 cents on the old crop, new crop was off a nickel, Beans where up 11 on old crop, new crop up 9, KC wheat was off 5, MPLS wheat was down 2 on the nearby while deferred slots where weaker, and CBOT wheat was down a dime.  Outside markets where mixed with the equities firmer for 6^th session in a row, crude was down, the US dollar is off with the Juen at 76.33, and European wheat was down 1.50-2.00 %.

The market traded today like what has been in the news lately or leading the headlines and that is that we saw the market play the hand that they feel beans will have a supportive report and corn a negative report.  Only time will tell and my bias is that even if we have a negative report the only way we really see extended pressure is if the USDA throws out numbers on the stocks report that are so high that they say it doesn’t matter how many acres we have.  I.E. I feel there are too many what if’s in regards to weather, acres, demand, etc to see grain just fall off of a cliff unless we see a number in the stocks that indicates we don’t need an acre battle.

Charts do look a little scary and really have set the stages to see tomorrow’s movement provide direction as most charts have condsolidated near support type areas that should either hold and provide another leg up or if broken indicate that much more downside is quite possible.  The other factors besides our supply and demand fundamentals will also play a big role; lately one of the biggest the US dollar has started to gain a little upside traction.  Will we see the dollar put in a bottom or should I say have we seen the dollar put in a bottom that could tie in with grains having made a top or is the price action in the dollar that of a corrective nature before more lows which would tie into the grains bouncing?

For risk management sake don’t be afraid to use the tools that are out there to help protect yourself as we really never know what will happen; that only thing we really have going for is right now is the fact that we are at profitable levels and a break probably still gives one a chance to sell profitable levels come tomorrow.  The other thing we have or should have going for us is seasonal tendencies; that we usually rally during uncertain times like planting and early growing seasons. 

Basis has been super firm on spring wheat so don’t forget to have your offers out there as things are hot and it is more freight related then anything. 

Please give us a call if there is anything we can do for you.

Thanks