GENERAL
ENERGY – The crude is down nominally today. Although near highs. The market, as suggested, has the demand, the technical and the political reason to remain supported. The demand destruction theory has yet to materialize. Look for the administration’s stance on energy. The lack of domestic expansion continues to be supportive energy. The natural gas market now solidly above 9.00, looks to also remain supported given the fundamental base. METALS – The silver has rebounded off the $20.00 level. I look for strength here. However no clear direction has materialized as higher rates have perhaps been a hinder to the bulls. BONDS – The recent rally in bonds has been short lived. The near term actually is giving a technical sell signal again. The rates are heading higher over time. The fundamentals support the need for further increases. It was my thought that the bonds have had such a significant move lower, perhaps a rally could unfold a bit more. The macro remains down.
SOY
Overall a quiet day. The bean spreads came under moderate pressure with the weather viewed as positive overall. The expectation for increased plantings is in line with the weather pattern. The demand for nearby beans remains strong. The US at present holds a key position for exports with the South American not participating in a large way. The weather will remain key through the course of the year. A good US crop is needed. However, will also be a key to a more than ample global carry. The Bio blending remains in a growth mode. This is supportive bean oil and vegoils in general. There remains a long term dichotomy here however. The global vegoil production is starting to grow. At some point ample supplies will be reached. This will be key to price discovery. As mentioned the meal remains weak relative to beans and oil. I continue to watch this closely.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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