Good morning!

Soybeans surged higher on the opening tick last night – pushing to a new all-time high.  The traders who are bullish keep reiterating the fact that these high prices are not slowing demand down for soybeans (inelastic demand).  The thought process now seems to be that if these record high prices aren’t rationing demand, why does the market need to move lower?  Statements like that are reasons why this market is choppy to the upside, as nobody is willing to go short.  A wild card in the soybean complex is yield/crop size – the USDA’s report on Sept 12^th will help us figure that out.

Corn demand on the other hand is showing signs of relief, namely in exports.  Japan for example is reportedly still 60% uncovered in its Oct/Nov/Dec corn imports (for feed).  Due to these record high prices it is thought that they will be pulling this corn from Brazil and Ukraine instead of the US.  We need to see markedly more of this if we are to ration enough demand. 

This afternoon we have our crop ratings (irrelevant) and harvest progress numbers out.  US corn harvest is expected to show 10-12% completed.

Currently

Corn is 4 to 6 cents higher

Soybeans are 17 to 20 cents higher