Wheat
Monday's session had wheat closing higher. That was brought on by the jump in the stock market and the weakness in the dollar. The stock market jumped higher was very supportive of commodity prices. Also a weak dollar was good for exports that drove wheat. These outside markets have been very helpful by delivering a nice bounce in the market especially after setting new lows last week. This was important that we did not stay at the levels we found last week. Also boosting the wheat market was a strong crude oil market that had gains today. This helps support all commodity prices.
The Dec. 8 session had Chicago March up 15 cents to end at $4.735, Kansas City March was up 12 cents to end at $5.0175, and Minneapolis March was up 12.75 cents to end at $5.7375. Cash Minneapolis bids for 14 percent protein wheat finished up 17.25 cents to 6.0825.
Wheat finished the Dec. 9 session slightly lower. Wheat opened the trading session following the firmer trend set in the overnight trade. Trading was light as many traders were evening up in anticipation of the Dec. 11 supply and demand report. Wheat gained on corn in the early going. Rain and snow in the central and northwest parts of the Midwest and in the Central and Northern Plains is considered beneficial to the U.S. winter wheat crops. And moisture levels in the Southern Plains are said to be getting dryer.
The Dec. 9 session had Chicago March down a cent to end at $4.894, Kansas City March was down 2 cents to end at $5.15, and Minneapolis March was up 2 cents to end at $5.6825. Cash Minneapolis bids for 14 percent protein wheat finished up 17.25 cents to 27.25 cents to end between $7.3825 and $7.8325.
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Dec. 10's session also had wheat starting higher following the other commodities. The spillover support from other markets was beneficial to the wheat exchanges. Traders were expecting Dec. 11's USDA report to be neutral for wheat. They are not expecting much of a change in the supply and demand for wheat. There is a strong basis right now that could be seen as a sign of strong demand. With a strong basis this could eat up supply driving prices higher. With the dollar weak again, there is some promising news for exports that could carry this price higher.
Chicago March was up 20 cents to end at $5.095, Kansas City March was up 16.25 cents to end at $5.3125, and Minneapolis March was up 21.4 cents to end at $5.90. Cash Minneapolis bids for 14 percent protein wheat finished up 22.75 cents at $7.7125 to $8.0625.
Wheat opened trading Dec. 11 with traders feeling bearish after a negative USDA supply and demand report. Traders said strength came on a supportive USDA report in soybeans, a sharply lower dollar and sharply higher crude oil. Although wheat finished the day lower much of this support helped it to not experience losses it could have had. Widespread noncommercial interest broke through the more influential bearish commercial selling.
In its December crop production report, USDA increased wheat imports by 10 million bushels and decreased food demand for wheat by another 10 million bushels. The net result was a 20 million-bushel increase in wheat's ending stocks estimate. The trade had been expecting USDA to decrease wheat's ending stocks estimate, so the report was more bearish to wheat than most expected.
The export sales pace did nothing to help wheat either as wheat sales were a very disappointing 8.8 million bushels. This brings the year-to-date total wheat export sales pace for the year to 766.4 million bushels compared with 1.05 billion bushels for last year at this time.
Corn
March corn started the week up 14.5 cents and quickly moved higher to post closing prices up 20 to 21 cents for the day. Strong support came from the outside markets as well as from a lack of sellers in the marketplace. Informa cut its production estimates for South America, while Australia and Argentina received beneficial rains for their corn crops.
March corn opened down 4.75 cents Dec. 9 but moved higher to post strong gains midday. The market then moved lower near the end of the day to close down 1.5 to 2.25 cents. Overall trade was light and narrowly mixed. There was a report of bird flu in China, though little effect was felt in the corn market. The corn market appeared to be in consolidation mode ahead of the Dec. 11 USDA report. The corn market continues to be heavily influenced by the value of the U.S. dollar, moving lower when the dollar rallies and recovering when the dollar falters.
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March corn opened up 14.75 cents Dec. 10, then encountered some weakness in the first half of the session. The market then moved higher later in the session to close up 14 to 15 cents. Corn followed crude oil very closely. Traders seemed to be willing to bid this market up ahead of the USDA report, which was expected to be bearish corn with lower exports and higher ending stocks.
March corn opened down 1.25 cents Dec. 11, which was a strong opening considering the bearish USDA report. The market quickly found more strength from outside markets to trade higher throughout the day, closing up 9 to 11 cents. The December USDA report showed ending stocks of 1.474 billion bushels, which was up from the November estimate of 1.124 billion bushels and higher than trade estimates. The weekly export report put exports at 41.7 million bushels, which is much stronger than what has been seen in recent weeks. The daily chart is showing what could be a bottom, but will need continued support from outside markets for it to hold.
March corn opened down 10.5 cents Dec. 12 because of weakness in outside markets overnight from the failed auto industry bailout. The market continued to struggle early but found tremendous buying interest and was 17 cents higher by midday. Farmer selling is very light, and two private forecasters put 2009 planting projections way down from 2008.
Soybeans
Soybean's started the week 30.5 cents higher in the January contract. The market continued upward and ended near the session highs, closing 37 to 41 cents higher. Crude oil was up nearly $4, which propelled the soybean market higher. The strong stock market and weaker dollar also were supportive. While it was nice to see the strong recovery in the market, it needs to have a good week in order to avoid being just a blip in the recent downtrend.
Soybean started Dec. 9 5.5 cents lower in the January contract. The market then moved upward to post some positive gains before retracting to close 7 to 10 cents lower. Crude oil was mixed as well with late weakness dragging down the soybean market. Traders were expecting a friendly USDA report, while rain in Brazil was helping the crop there. Soybeans are fundamentally bullish but could see more downward pressure from the technicals.
Soybean trade started Dec. 10 26 cents higher in the January contract. The market quickly moved lower, then had a surge in the middle of the session before closing up 16 to 18 cents. Crude oil was higher as well with soybeans following the crude almost tick for tick. Traders were expecting a friendly USDA report, but trade in recent weeks has been anything but fundamentally based. Basis levels got significantly stronger due to continued light selling by farmers.
Soybeans started Dec. 10's session 15.75 cents higher in the January contract. The market then continued to move higher because of support from higher crude oil and a weaker dollar, closing up 25 to 27 cents. The USDA ending stocks report had soybean stocks basically unchanged, but this should have been bearish because of expectations of lower ending stocks. With crude oil up over $4 and the dollar weaker, any bearishness from the report was overrun by outside market support. Export sales were strong for the week at 29.8 million bushels, with China buying another 4.4 million bushels. Traders are starting to see the V-shaped bottom they had been looking for.
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Soybean trade started the day Dec. 12 16.5 cents lower in the January contract. The market then continued to move lower because of pressure from outside markets and reports of higher planting intentions for 2009. With strength in the corn market and new export sales to China the market recovered to mixed trade by midday. Basis levels were firm with continued light selling by farmers. There is bullish carry in the soybean market with July only 2.2 percent higher than the January contract, which is 0.37 percent per month, equivalent to 4.4 percent per year.
Barley
USDA reported no barley shipments for last week. This brings the year-to-date barley shipments pace to 9.9 million bushels compared with 23.4 million bushels for last week at this time. The USDA supply and demand report reduced exports by 5 million bushels and raised imports by 5 million bushels to raise the ending stocks from 68 million bushels to 78 million bushels. The weekly export sales report has exports for the year at 188,400 metric tons vs. 544,400 metric tons last year. Cash barley bids in Minneapolis were unchanged with malting barley bids at $4.90 and feed barley at $2.25.
Canola
The Winnipeg, Manitoba, canola futures market closed higher for the week. Most of the strength was a result of carry-over strength from a stronger U.S. soybean complex. Adding light support was a decent performance in the U.S. energy sector. Also news that China was interested in buying canola helped to lend support as well. Cash canola bids in Velva, N.D., ended Dec. 11 at $13.49.
Sunflowers
The USDA weekly export sales report showed exports of 6,400 metric tons on the year vs. 3700 metric tons at this time last year. Cash sunflower bids remain stagnate with bids in Fargo, N.D., at $11.60.
