AM Comments 05/22/13
Wednesday, May 22, 2013, 8:09 amSubmitted by: Dustin Weiner
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Good morning!
Our markets are mixed this morning with old crop a little weaker while new crop is a little stronger. The old-new inverse made new highs yesterday, but traders took profits in those spreads last night which is explains why new crop months are trading higher.
This relaxation of spreads is also reflective of the strong cash movement we have seen lately – especially in soybeans. Nearby soybean basis has collapsed over the last 48 hours as farmer-owned soybeans are hitting the market.
Weather… we have a slow moving system coming through this week with light rain showers for Iowa, Minnesota and Wisconsin and heavier rain forecasted for Illinois. The weather should stay active for next week as well with some showers scheduled for mid-week and next weekend. After that however, the 11-15 day models look like above normal temps and below normal precip. We need to be careful here as the market will start to view rainfall as “rain makes grain” instead of as a planting delay with every additional acre planted.
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