COMMENTARY:
SOY
BEANS – The beans were a bit lower Friday after the recent appreciation in price. The recent sales mostly to China have been better. The weekly sales were just under 2.9 mmt. This is a positive but the Chinese purchases are way off at present. The weather in South America have been beneficial. However, duly noted they are needed as well as much more. The market will continue to focus on concerns over La Nina. It is my belief these fears are over blown. However, the market needs to focus on something and weather is a hot button with the Media.
MEAL – The meal exhibited strength Friday, and has risen approx 12-14 dollars per ton of late. This is due to a corrective bounce, short covering, and bean oil is correcting a bit. There are no new bullish meal fundamentals that I see at present. Somewhat to the contrary. The meal in China has been weak. The US market is well covered. The demand is not picking up in the near term either. The oilshare is approximately 50%. This was my target over all.
BEANOIL – The bean oil is correcting. The palm market is down approx 3% over the last week. The fundamentals are slow to change. However, the price appreciation has been steep and quick. This gives pause to demand. It is tough to pick tops. Although perhaps the highs are in. On the bull side. The veg oil prices in China are still appreciating and pushing crush margins to very high levels. Lets see what next week holds.
CORN – The corn has risen approximately twenty cents over the last short period. The corn in my opinion is at a critical juncture, flat price. The export sales are supportive. The ethanol situation supportive at present. The Mexican government has said that they will continue to purchase GMO corn. They just will not grow it themselves. The corn will watch planting in the Southern Hemisphere. This will be a key factor there. An issue with production and prices will go higher. A good season and perhaps not. It is worth noting, in my opinion, that the corn could stay stronger than beans on a relative basis.
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BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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