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US Dollar Index Falls Below the 100 Mark

Grains Continue Lower in the Overnight

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Grains continued lower overnight although managed to curb losses heading into the morning break. In outside markets, the US dollar index fell below the 100 mark for the first time in 7 weeks and equity futures firmed into all-time high territory.

USDA announced export sales 141,224 of corn to unknown destinations

Conditions in Argentina appear to be stabilizing for after serious flooding after Christmas stoked fears of big crop losses. Hot and dry weather in the past week has helped limit the potential for loss. Analysts down there suggest only about 10% of the production is at risk which is in-line with estimates floating around the Argentina’s crop size will be 52 to 54 MMT vs 57 current projected by USDA. One other potential driver for beans is the thought that Argentina farmers will be slow to sell beans but quick to let go of corn off the combine as the eliminated export tax on corn will give farmers incentives to sell. Meanwhile, the soy export tax remains intact until Jan 2018.

On the soy chart, yesterday saw a couple of tests of fresh lows around 10.51 versus March before closing at 10.59. But, in overnight trade, the market quickly returned back to the recent lows testing the 10.50 wall a couple of times overnight before recovering to the 10.54 area. Watch the 10.50 area as it seems to be serving as key support right now.

New procedural moves by the Trump administration are causing concern in grain after the EPA announced a delayed implementation of its RFS for 2017. China's corn futures are on track to rise almost 3 percent this month, on speculation that major corn-growing provinces in the world's top producer are preparing to buy grain in a bid to support farmers as demand is expected to drop. March corn futures came off the recent highs yesterday, posting a key reversal on the charts.

Japan's Ministry of Agriculture is seeking to buy a total of 110,687 tonnes of food quality wheat from the United States and Canada in a regular tender that will close late on Friday.

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