No one knows what the USDA will present to us at 11:00 tomorrow…………………………………………We’ve been surprised with the last two reports and it is always good to approach these numbers with caution………………………………………………………………………
World wheat stocks and feed grain stocks have been interpreted as potentially bullish in the last few reports yet, we haven’t rallied given the macroeconomic reality of quantitative easing and fear of stagnation in trade pacts and agreements…………………………….Timing is everything! Soybeans remain in a perceived surplus and South American planting and weather conditions have been good so there has not been an urgency for ownership even though we are at the wrap up phase of harvest in the USA………………………………………………………..Thursday’s figures may paint another friendly picture for grains but we may need a weather scare to generate renewed speculative buying as the macroeconomic influences have been neutral to bearish………………………..
After the USDA figures we’ll have to contend with the end of the month, December deliveries and Holiday trade atmosphere! Presently, basis levels suggest that we will see healthy deliveries on corn while wheat may be light……………Regardless, we need to see much firmer basis levels to generate any interest in lifting wheat out of Toledo before the Great Lakes close in mid December! We still sense that the March contract will be the one which shows value if anyone needs to own quality stocks in the Spring!
Too cheap to sell and no urgency to own! ………………………expect on November 28 when it is a “Voice From the Tomb” day to buy March wheat!
The information contained on this site is the opinion of the writer and obtained from sources cited
within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.
Steve Bruce
Walsh Trading
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