A slightly higher opening in grains quickly gave-way

12-10-09

GLOBAL COMMODITY ANALYTICS & CONSULTING LLC MID-DAY GRAIN UPDATE:

GOOD DAY EVERYBODY, HERE’S THE LATEST AT THE MERC AS WE HEAD INTO THE MID-DAY SESSION:

• A slightly higher opening in grains quickly gave-way to two-sided trade as this morning’s USDA monthly supply-demand report came in as expected by the trade—with the corn and wheat seeing a reduction in demand while the soy continues to see increased demand in the form of higher exports. As a result of the demand changes, stocks went up in corn and wheat but were reduced by 15 Mln. Bu. In the soybeans. The net effect of the report was to keep the grain trade focused upon the outside markets.

• Given the neutral report and the continued shaky outside markets, the grains couldn’t hold-onto a stronger opening across the board, and has now turned negative in both the beans and wheat while the corn continues to feel the strength of the western corn belt blizzard.

• Going into the close, if the crude oil could turn positive again, I would think that the beans and meal may be in a position to rally—especially given that the weekly meal export sales were nearly double expectations and bean weekly sales were nearly 1 MMT. So, I’ll be looking to see if the Jan. Beans and Meal can take out their highs from Wednesday, where buy stops are likely resting.

THIS IS MIKE ZUZOLO, AT GLOBAL COMMODITY ANALYTICS—VISIT WWW.GLOBALANALYTICS.BIZ FOR MORE INFORMATION AND MARKET ANALYSIS.

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