The big grain report was released at 7:30 a.m. CST yesterday and it forced the market move down, and in a hurry. Corn futures were limit down seconds after the open, coming off the limit move around 10 a.m. for roughly five minutes, then right back down to the 40-cent limit move. Due to an underestimation of corn supply, the news came out that production and supply of domestic corn and beans came out better than predicted. Thus, the concerns about South American weather subsided for a day and March corn traded to $6.11 ½. The news on the beans was bearish, as well — not as bad as predicted on the international front, but came in a bit higher.
It looks as though grains have some more room to head down, and with all the grains coming in strong, including wheat and beans, there looks to be some more attractive prices for end-users. March beans fell to 11.825 down 20.5 cents, as they have been under similar downside pressure from yesterday. We are looking for prices to continue to the downside into the weekend, with questions still looming about the international weather implications and margin clerks sharpening their pencils.
We look for corn to open 1 to 3 higher and for beans to open 2 to 5 higher.
Daily CME spot market prices:
Block cheese: $1.595 (unchanged)
Barrel cheese $1.58 (unchanged)
Butter: $1.6125 (down 1.5 cents)
Grade A NFDM: $1.45 (unchanged)
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