Markets are called mixed this a.m. behind a choppy mixed
overnight session, pre-report trading, and supportive outside markets.
In the overnight session we saw corn unchanged, beans
unchanged to down a couple, KC wheat off a couple, MPLS wheat was down 4, and
CBOT wheat was down 3. At 9:00 outside markets have the DOW up nearly 100
points, crude up a little over a dollar a barrel, and the US dollar in the red
with the cash index down 222 at 80.825.
A waiting game is what some are saying this a.m. as parts of
S.A. get some moisture; the market waits to see how much and how wide spread
coverage. Forecasts are still for hot and dry after the current weather
event.
More then the weather the market is waiting for the big USDA
report which is out on Thursday. Don’t forget that we did move our weekly
marketing meeting to this afternoon and we plan on covering the USDA report as
well as some strategies to consider heading into the report.
Here are the estimates heading into the report. Don’t
forget this report will also have the final crop yield as well as winter wheat
planted.
U.S. ending stocks 2011/12
Wheat Corn Soybeans
Average trade estimate
0.842 0.749 0.233
Highest trade estimate
0.888 1.020 0.285
Lowest trade estimate
0.766 0.587 0.127
USDA December estimates
0.878 0.848 0.230
Basis is defensive and likely remains that way until we see
some sort of export to domestic competition. This goes for most of the
grains; and wheat and corn in particular. We lack the export demand and
the domestic demand is soft. For corn the domestic demand should be soft
if the ethanol plants are running in the red like many are saying. Wheat
mills simple feel full and know that we lack export demand (competition) and we
have the rail road have one of their best performances of all time for the
winter season which just adds supply.
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