Grain Spreads: Early Rally/Late Fade

Sean LuskGeneral Commentary

Commentary

Slower news day in the corn market after it started the day stronger with a March 23 Corn posting a high on the day at $6.60/bushel. However, Corn fell negative by the close to lose a half penny to 653.4. Beans took back just about all of the prior day losses, rallying almost 20 cents to finish the day at 1479.6. Down only 3.6 cents on week. Crude oil strength and equity strength following the CPI report supported soybeans & soybean oil today in my opinion. A new crop export flash sale of soybeans was observed this morning for 140,000 metric tonnes of soybeans for delivery to unknown destinations. The US dollar is making new lows, back to levels last seen in June of this year, which is adding overall strength to most commodity sectors today. The wheat sector was mixed today, Minneapolis up 6 cents, Kc up 3 cents, Chicago down 4 cents. Big fade though across the wheat Board as both KC and Chicago finished 14 to 19 cents off the morning highs. That perhaps was the theme of the day across the commodity Board. Morning rallies were faded as the Dow futures contract fell over 800 points from the session highs. We saw similar pullbacks in grains, livestock, and energy. Tomorrow the Fed concludes a 2-day meeting with an announcement on short term interest rates and a press conference with Chairman Powell to follow. It may be the reason for no follow thru rallies in many markets as the trade awaits Fed commentary. 

Trade Ideas 

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Sean Lusk

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