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Grain Trading Hours (Effective January 15, 2016) Grain Buying and Trading hours will be 8:30 a.m. and 1:20 p.m. weekdays (except for holidays). All grain must be bought and sold during these hours. Click here to read more information.
I'm going to sound like a record on repeat since we still cannot gain any traction or direction in this market. Grains continue to chop sideways and ever so slowly towards the bottom side of our ranges. Both corn and beans ended the week in the red.
Corn this week could not make a break to the top side of our ranges and instead succumbed to closing weaker for the 2nd straight week. Corn finished the week closing at $3.6575, down 2.75¢. Farmers continue to keep the bin doors locked shut until the market is willing to reward them with a 15-20 cent rally. Export sales were above estimates this week but we are still well behind the pace that the USDA has set for us. As the dollar cheapens up, other countries will hopefully look to us again and begin sparking demand. We are going to need help in this category if we want to see any significant rallies. We have so much supply in our area and the Eastern Corn Belt isn't running out anytime soon either, and little demand to move it anywhere. Continue to watch South American weather and the US Dollar for some direction. Basis continues to widen out locally, so in my opinion think about locking in some basis contracts in the coming months. Options have also gotten really cheap. For those that like to add options to cash sales as an insurance policy, I would take a peek at the $4.00 and $4.20 July Call options. As far as new crop goes, I would look at utilizing a combination of basis contracts and target orders above the market to capture any rally opportunities. Initial resistance for corn lies at $3.7375 and the corn bears are eyeing a test of support at $3.645.
Soybeans have not been able to hold any ground at all this year and make me a little nervous. Prices were driven lower today by a weather forecast that's calling for rain in much needed areas of Argentina. Beans ended the day closing down 7¢ at $8.675. Demand continues to falter as export sales resulted in a net cancellation this week. Some bullish news this week was that CONAB did lower Brazil bean expectations by 1.2 mmt as they feel Mato Grosso yields are somewhat disappointing compared to past years. Last year's Brazil bean production yielded 96.7 mmt and stands as a record bean crop for Brazil. As with corn, farmers are not willing to part ways with the beans they have left since prices are just not high enough. I think this year is going to be very different in the respect to seasonal basis trends. Rumors are out there that bean crushers are filling up and needs are met until possibly late spring-early summer. I don't see any reason for bean basis to improve anytime soon if at all before harvest. I think the tone for beans is the same. Sell into these rallies as we near the top side of our ranges. Initial resistance lies at $8.725 with support lying at $8.67. $8.67 is acting as our current range floor. A close below that next Monday opens the field to retest $8.55 and then our major support low at $8.47 in days and weeks to come. With the weak close going into the weekend the market could be hinting that another leg lower could be in the cards.
Crop Report February 9th @ 11:00 a.m.
FCA has a new grain policy. FCA will only be purchasing grain during CBOT trading hours, which are 8:30 a.m. to 1:20 p.m. FCA will be accepting offers to sell grain before and after market open and close but the offers must be in increments of 5,000 bushels allowing us to place orders in the overnight session. Call with any questions!
If you have any questions or need any marketing advice please give us a call!
Have a Great Weekend,
Aric Gordon- 507-847-4160 ext. 1104 Glen Nordhausen- 507-847-4160 ext. 1103 Bob Bloomgren- 507-847-4160 ext. 5002 Eric Dubbelde- 507-847-4160 ext. 1102