AM Comments 02/27/14
Thursday, February 27, 2014, 7:59 amSubmitted by: Dustin Weiner
Good morning!
The USDA was out this morning with their weekly export sales report (details below) and this should finally be the week we see big net cancellations to China right? WRONG. Another 327k MT of old crop beans were sold (along with 315k MT of new crop sales) last week meaning we still haven’t seen net cancellations and we are increasing –not decreasing—our export commitments. Simply put, ANY old crop soybean sales are ‘too many’.
Corn also saw strong export sales but that market has pulled back and is trading lower as corn futures reached certain objectives on the chart. The corn market isn’t afraid of export sales, instead it NEEDS them. Soybeans have 105.8% of the USDA projected sales already on the books while corn has 88.9% of the USDA projected sales on the books.
The outside markets are lower with Crude Oil lower at this time (DN 11 @ 102.48) along with a higher US Dollar (136.61 vs. Euro) and the US stock market is lower (DN 17). Palm Oil was lower overnight (DN 24) pulling back after a higher move on Wednesday.
So for today expect soybeans to continue to march higher thanks to tight US supplies (that just got a little tighter) mixed with lower production ideas out of South America. Every day that soybeans work higher they are making new contract highs. It seems like everybody who cares to talk about soybeans right now tends to be bullish. Sounds great if you are long beans, but remember that when you put everybody on the same side of the boat… the boat tips.
Opening Calls
Corn down 2 to 4 cents
Soybeans 4 to 8 cents higher
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