USDA released their monthly supply-demand report before the opening this morning

3-10-10

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:

• USDA released their monthly supply-demand report before the opening this morning, with widely anticipated revisions made to the ’09 corn and bean crop coming in pretty disappointing; for corn, USDA left harvested acres for both corn and beans unchanged from the Feb. report, and took corn yield down only .3 bu/acre while leaving the bean yield unchanged. These lackluster revisions were accompanied by revisions higher for bean exports but lower corn export. The net result was an increase in corn carryover to 1.8 Bln. Bu. And a decrease of 20 Mln. Bu. In beans to 190 Mln. Bu. Wheat carryover was raised to the point where we are now over the 1 Bln. Bu. Mark.

• So, we had the report numbers as well as news that China bought 110,000 tonnes of US beans before the opening bell; with these pieces of news, the grains opened down 5-6 across the board. As we head into mid-day, with outside markets starting to come alive and support a little more risk-taking, the front-end beans have turned positive and this has allowed both corn and wheat to cut their losses in half.

• As we head into the close, given that USDA’s report is mostly a let-down for the bull, I would think that both weather and outside markets need to compensate to keep trading psychology at least friendly. For me given the fundamentals, front-end beans continue to be the leader to the upside while the front-end wheat continues to be the market leader to the downside.

DON’T FORGET TO VISIT THE WEBSITE: WWW.GLOBALANALYTICS.BIZ

The information above is not meant to be advice to buy or sell futures or options. Copyright, 2009 Global Commodity Analytics & Consulting LLC