Early Market Talk

Starting the week mixed and on thin volume. At 0600 CH19 off $0.02 at $3.79 ¾ with SH19 down $0.02 ½ at $9.14 ¼. KC and Chi wheat each $0.1 ¼ higher.

CH19 has been inside a $0.23 ¾ range now since September 28th with SH19 inside a $0.82 higher trending range since September 21st. Soybeans need to take out the January 7th high of $9.27 ½ to keep the trend alive. Picture of that to follow shortly.

Pessimism this morning that “IP theft” is nowhere on the radar of trade concessions with China. Dow futures off 140 points this morning at 24,548 in response.

Wheat markets firmer on world wheat values which are nearing 4-year highs. US wheat competitive in world markets. Russian Ag Minister threatening domestic price controls through rail subsidies.

SNSX in to $0.12 ¼ after hitting 18 early last week. Flat price market action continues to dominate spread with futures up $0.28 over the same time.

Corn basis firming with limited farmer sales and commercial eyeing carry to CN18.

Soy/Corn ratio heading the wrong way to entice soy acres to switch to corn. Ratio at 2.41 this morning. Up from 2.35 December 26th. Last time we saw a significant switch out of beans this ratio traded under the 2.0 level. Current market structure would suggest no more than a 2-million-acre switch?

Senate expected to vote on a border security package Thursday. Govt shutdown has no end is site. COT data now four weeks old.

Traders lowering Chinese soy import forecasts in the face of ASF outbreak.

Brazil weather remains problematic with a well followed group lowering production 1 mmt on the week to 115 mmt. Last USDA forecast at 122 mmt.

Article Written by:
Bruce Nelson