The Beans and Meal finished the day with modest gains. The market is looking at rainfall in ARG. The Brazilizn crop is being harvested on a very quick pace. The availability is high and the sales have been huge. Meaning the Brazilian exports are moving. The next three to four months the US will take a back seat. The one saving grace for US exports is the Decline in ARG production. Or our exports would be in further decline. I am not sure the debate going on. We added 30 – 34 million tons of global carry in the last 2.5 years. In addition oilseed stocks in general are close to a record. These prices to me look like a opportunity to the producer. I believe the acreage report will lean in favor of beans 91.2-92 million acres. This will be significant. If the weather is good then we will see a huge carry. If that plays out the market will need to find demand through price. Betting on weather problems this early seems like a gamble.
Corn was steady slightly lower today. The temporary highs were made at 412ish basis dec18. The market is now backing up a bit waiting on the acreage and weather. The weather will be important for corn. The carry could be 1.6-1.7 bil. Given demand this is not bearish. A weather disruption could send us higher. Be patient here. A bit more break can set up a longer term opportunity. Breaks should be bought by users. The risk in corn having some run is real this summer. More so than beans in my opinion. As usual quantify your risk.
The tech picture on the daily in beans again has the opportunity to be short. Trade with stops, risk is high given market movements. To discuss opportunities in the acreage report please give a call 312 208 8837 jwalsh@walshtrading.com
Be Well