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Grain Hedge Overnight Highlights

Grains were mostly quiet overnight with little news or volatility to change prices.

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Grains were mostly quiet overnight with little news or volatility to change prices. In outside markets, S&P futures were fractionally higher while crude oil dipped in early trade.

For soybeans, there was mild support to start the week from planting delays in Brazil. Soybean planting in Brazil remained behind the historical average even after isolated rainfall hit the mid-section of the country. Planting in Brazil stands at 31% compared to the 42% five-year average and 20% last week.

For wheat, Ukraine continues to struggle with dry conditions for the winter wheat crop. A senior weather forecaster there said the driest winter in 50 years could potentially lead to a 20% reduction in wheat output. In other wheat news, Japan is seeking to buy food quality wheat in its normal tender to the US, Canada and Australia with the deals expected to be announced on Thursday.

In outside markets, Asia sold off overnight as slow Chinese factory data took its toll. S&P futures (ESZ5) had been lower overnight but managed to fight its way back to positive territory heading into the morning opening bell. The US dollar index (DX-MZ5) was slightly weaker as well in overnight trade, but still remains up 3.2% in the last two weeks.

Oil prices (GCLZ5 / QMZ5) fell on Monday as weak Chinese economic data fueled concerns about demand slowing in one of the world's largest oil-consuming nations, while record-high production in Russia exacerbated the global supply glut. China's factory activity fell for an eighth straight month in October, a survey showed, pointing at continued sluggishness in the world's second-largest economy. The global oil supply glut, which has more than halved oil prices since a peak in June last year, was underscored on Monday when Russia reported that its October oil production hit a post-Soviet record of 10.78 million barrels per day.

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a dba of Foremost Trading LLC (NFA ID: 0307930)

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