Early Market Talk

Firm trade overnight but volume continues the lite side. At 0600 Ch19 up $0.02 at $3.75 ¾ with SF19 at $8.74 ¾ a modest $0.04 ¾ higher. Chi and KC wheat showing fractional gains.

Dow futures giving up 343 points this morning after a record setting gain yesterday. Crude oil also giving back some of the sharp gains it saw yesterday. WTI trading off .74 at $45.45 this morning. US $ Index showing some sharp losses as well.

Question lingers on whether the partial gov’t shutdown will be resolved prior to the Jan 11th and if not impact on USDA report. Trade expecting a lower corn yield.

Since 2000 there have been 7 years that the corn yield declined between the Oct and Nov report like this year. 5 of those years there was a further reduction between the Nov and Jan report. Lower corn yield this year fits the pattern.

Will not see export sales report tomorrow due to Gov’t shutdown. We saw inspections yesterday because those numbers are privately funded. Sales figures are not.

Corn flirting yesterday with its up-trend line established off the Sept 18th and Nov 26th lows. Continues trading inside price wedge with the apex forming mid-February. Breakout to the upside during that time would suggest a move into an area that several other tech formations would target and fill a gap left back in June. Need some yet unwritten news to get that done?

Concerns on dryness in Mato Grosso Do Sol and Parana continue with that area receiving just 10 – 20% of normal precip the last month. Most certainly some yield declines in this region but overall suspect Brazil still has a potential soybean crop size north of 120mmt or 4,400 mln bu.

Corn market needs to hold yesterday’s lows or a quick run to the $3.67 ¼ low set Nov 26th would be expected by many…