Grains were mixed with little movement overnight as wheat finished the overnight session fractionally higher while soybeans gave up 3 cents and corn was unchanged. Outside markets continued to move lower with the S&P futures and crude oil futures lower.
This morning’s export sales report showed corn and wheat in line with trade expectations while soybeans came in above expectations. In other export news, USDA announced a sale of 116,000 MT of milo to unknown destination in their flash reporting system.
Today, Informa is expected to release updated 2016 planting forecasts at 10:30 AM CDT while next Monday the monthly NOPA crush estimate for October will be released with traders looking for a 161 MB crush of soybeans.
S&P futures (ESZ5) continue to be pressured by weak commodity markets and the potential for a Fed interest rate hike in December. Comments by Fed Chair Yeltsen and other Fed directors yesterday seemed to confirm to traders that an interest rate hike is likely in the December meeting.
In crude futures (GCLZ5 / QMZ5), prices continued to move lower following yesterday’s unexpectedly high inventory build of crude stocks. EIA reported that stockpiles increased by 4.2 million barrels last week, compared with expectations for a 1.0 million-barrel build. Gasoline stocks, which have been hovering at seasonal record highs since early October, fell by 2.1 million barrels, compared with analysts' expectations in a Reuters poll for a 807,000 barrels drop. Distillate stockpiles, which include diesel and heating oil, rose by 352,000 barrels, versus expectations for a 931,000 barrels drop, the EIA data showed. Inventories now stand at their highest for this time of year since 2010.
The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a dba of Foremost Trading LLC (NFA ID: 0307930)
