Opening Grain Market Comments 9-3-13

Markets are called better this a.m. behind a very firm overnight session that was lead by soybeans.

When the overnight session ended we had soybeans up 46 cents, KC wheat up 5, MPLS wheat up 4, CBOT wheat up 6, and corn up 6.  Outside markets at 8:00 have the US dollar up 200 points with the cash index at 82.318, crude about unchanged at 107.50, gold up 2 bucks, and the DOW futures pointing towards a positive start of about 100 points.

A very choppy volatile trading session last night.  In the soybean market in particular.  We gapped higher by opening up around 37 cents higher, then moved up to nearly 50 higher, only to break some 26 cents, before moving higher getting to up 50 cents with just a few minutes before the end of the session

Why so strong in the soybean market?  First off we did have some longs exit late last week before the long weekend.  So perhaps some of them wanted to get back in?  Overall it looked like most called the moisture that we got over the corn/bean belt over the weekend as expected to less than expected.  Plus the forecast doesn’t show much moisture any time soon.  Many are saying that it will be too little too late when/if the moisture hits.

Fundamentally many are talking about even lower bean yields with some thinking perhaps we will be less than year ago.  So many are jumping on the bandwagon that we need to ration off demand.  One thing to keep in mind is that the USDA had big increased year over year in demand; so don’t be surprised if the USDA report we get Thursday the 12^th shows some demand coming off the table to offset production decreases.

Corn and wheat seem to just be following the bean market.  Not exactly super willing followers either; at least not yet.  Now if the bean market is for real and it looks to be that right now.  One has to thing that it gives some support to corn and wheat; if for nothing else for acre purposes in the coming year.

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