In the overnight session the grains are trading lower with March corn down ¾ of a cent, January soybeans down 2 ¼ cents and March Chicago wheat down 1 cent. Kansas wheat is down 1 ½ cents this morning after six days of drifting higher due to a forecast for a cold snap in the HRW growing region at the end of December. The slight rebound we have seen over the last week will likely run into overhead resistance at the November 28th low of $4.22.
Yesterday it was announced by the USDA that China is reducing the amount of foreign material allowed in shipments of U.S soybeans starting the first of the year. Shipments that contain less than 1 percent FM will be processed quickly while cargo’s of soybeans that test greater than 1 percent FM will be investigated further. The standard quality specification for No. 2 yellow soybeans allows for up to 2 percent FM which will add further frustration to grain exporters and may even curb imports. Ensuring that soybeans contain less than 1 percent FM will add cost to our exports which may reduce how competitive we are with South America.
The EIA announced ethanol production dipped last week to 1.077 million barrels per day from 1.089 million bpd. Despite the decline this is well over last years production during the same time period. Weekly stocks also declined slightly to 937 million gallons from 940 last week. Weekly stocks continue to be sharply higher than last year during Mid-December.
Strong export sales numbers released this morning for the period between December 8th and 14th. Wheat sales were reported at 796,300 metric tons which was a marketing year high for the grain. Net corn sales were reported at 1,558,300 metric tons which was up 80 percent from the previous week. Soybeans sales also increased compared to last week, booking 1,742,900 metric tons of sales.
Weekly Export Sales-
|
Actual |
Estimated |
|
|
Wheat - NC |
796 |
300-600 |
|
Corn - OC |
1,558 |
800-1,100 |
|
Soybeans - OC |
1,742 |
1,300-1,800 |
The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)
