Sunday Night Grain Outlook, 3-01-09
Sunday Night Grain Outlook
By Duane Lowry
Sunday, March 1, 2009
OPENING CALL:
Corn= 1-2 higher, Wheat= 2-3 higher, Soybeans= steady-better.
Weather continues to suggest the US hrw wheat region will remain dry this week, but the 6-10 day forecast begins to offer improved moisture prospects. Some talk exists that weekend cold temps were detrimental to recently greening wheat.
News> Tensions between Argentine farmers and government officials remain heightened, limiting natural grain movement.
Wheat will start higher on ideas Friday’s 5-cent dump in the final minute of trade was overdone. Weather spin is not much different than Friday. Technical conditions are not poised to fuel downside follow-through from Friday’s late weakness. Speculative buying interest is expected to increase with the beginning of a new month.
Corn will start higher on ideas Friday’s late weakness will lack follow-through this week. New news is limited. There is growing interest in the speculative community to look for buying opportunities. Whether that manifests in the form of buy-stops above the market to force favorable price action to occur before new longs are initiated or whether it arrives in cautious/gradual bottom-picking activity remains to be seen.
Soybeans will support from Friday’s ability to stage independent strength, especially since it comes at a time when many see soybeans as the preferred bearish expression vehicle. Argentine farm/political leader tensions continue and this is not conducive to orderly grain trade flow domestically. It also makes potential foreign buyers uncomfortable, remembering added costs experienced during last year’s farmer strike that prevented orderly movement to the export ports. Technical conditions seem capable of spurring buying activity—both short-covering and new speculative interest.
In summary, overall price action during the past several days has been stabilizing and you can sense an improving mood in the speculative community to consider long positions in agricultural markets. At minimum, this minimizes selling interest. Outside market tone will continue to be an important barometer, but clearly the spec community is most interest in “going with” some bullish aspects of these outside markets, with bearish aspects’ influence limited to sidelining potential players, as opposed to generating bearish commodity positions.
This newsletter is prepared from information believed to be reliable. Early Market News, Inc. does not guarantee that such information is accurate or complete and it should not be relied upon as such. Opinions expressed are subject to change without notice.
