AG
The markets were higher early, as the morning progressed the markets liquidated in general.
BEANS – The soy was actually led lower by the bean oil. The fundamentals remain supportive at present. However, the oilshare has had a very significant move of late with the market above 46 % at present. It has been my contention that the oil share could move to approx 50%. I still am of this belief. The reason here is that the bio market is a large draw on inventory. The stocks reflect this. In addition, the South American situation could turn tenuous if the Parana river water level remains shallow. This appears to be getting worse at present. The bean oil today stopped short of an all time high. The beans in my opinion will follow veg oils. The market will look to month end for planted acres. My hope is that we see a large rally into the acreage estimate. It is my thought there may be more bean acres planted than the market has figured into the balance sheet . This is my thought and is not a sure scenario.
CORN – The corn was again under liquidation. The market is in no mans land in my opinion. Somewhere between the recent highs and lows. The inverses remain large. I am watching this closely. The fundamentals remain intact, however some of this is dialed into the current price. Like the beans the acreage looms large. The Safrinha crop remains on the down trend. This is perhaps somewhat figured in. It appears to me there is some risk in the old crop length. The new crop too may well be supported. The one caveat is if there is a larger than estimated acreage number. The Chinese appear to still need corn on a regular basis.
WEATHER INSIGHTS
There are concerns in and through the upper Midwest / Plains. The Dakotas and Minnesota will become stressed through the weekend further as the temperatures are poised to increase. The overall moisture levels outside of these areas in the US are fairly favorable with more moisture called for.
There remain concerns as well through Canada in the southern crop regions. They too will feel the brunt of the weekends expected heat.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
800-993-5449
312-208-8836
jwalsh@walshtrading.com
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