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Wheat Continued its Climb in the Overnight

For the third day in the row, another flash sale by the USDA.

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Wheat continued to move higher overnight following yesterday’s double-digit gains, while soybeans and corn were slightly weaker. In outside markets, S&P futures tried to recover from the huge sell off while crude oil continued to move higher after yesterday’s gains.

For the third day in the row, another flash sale by the USDA. Exporters sell 178,000 MT of soybeans for delivery to China during the 2015/2016 marketing year. In an additional sell, exporters sell 249,000 MT of soybeans for delivery to unknown destinations during the 2015/2016 marketing year.

Global markets were shook up yesterday after the European Central bank announcement that they wouldn’t lower interest rates nearly as much had been expected. The result was a big swing in currency values as the Euro shot higher while the US dollar plunged, erasing all of the gains in the last 30 days. By the close yesterday, the US dollar Index (DX-MZ5) was off 2.5%. In overnight trade, the dollar has recovered about 0.5 % but still seems likely to continue to move lower.

In grains, the downdraft in the dollar spells good news for higher grain prices as a cheaper dollar helps make US exports more competitive. This is especially beneficial for wheat that depends so heavily on competitive pricing to be viable in the world trade.

In other news yesterday, Informa released production estimates for South America pegging corn production at 102.3 MMT versus a previous estimate of 100.3 and soybeans at 159.9 versus 160.0 previously. This morning, Stats Canada pegged the 2015 wheat crop at 27.59 MMT, which came in higher than expectations of 26.7 MMT.

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