CMEGroup Grain Futures Calls:
-March corn called 2 to 5 higher.
-March soybeans called 7 to 10 higher.
-March wheat called 1 to 2 higher.
March US dollar is down 16 at 80.55. April crude is up $.48 at $80.54. March Dow futures are up 49.
Economic Information:
-Federal Reserve chairman Ben Bernanke will give is bi-annual testimony to congress on Wednesday and Thursday.
-A second revision to our fourth quarter GDP rates is due later this week. The trade expects the original reading of a 5.7% growth to be revised to a 5.6% rate.
-Israel’s prime minister calls for an oil embargo on Iran, even without official UN sanctions.
-The National Association for Business Economics indicated the economy is growing. They do expect unemployment to remain above 9% the entire year though.
-Consumer confidence, durable goods orders, and home prices and sales will be out this week.
-Rumors circulate that Germany has prepared a 20 to 25 billion euro bailout package for Greece.
Weather:
-The rain and snow system will finish up in the east this morning. There are no forecasts for precip in the Midwest through next week.
Grain Market Influences:
The government’s very mild inflation report on Friday, the CPI, showed a very mild 0.2% increase for January. That should alleviate fears of inflation and also keep the Fed from raising interest rates. That is supportive to crude oil and therefore grains.
Corn summary… This was an interesting commodity week with many emotional stories to swing thinking from bullish bearish. Corn ended the day +2 3/4 and the week -1 1/2 cents. Ag news this week included Japan and S Korea balking about US quality.
Soybean summary… It was another very low volume trading day in beans today. This morning started with a day session reaction to the higher dollar and after that trade was dead calm for the rest of the day. Next week we get China back into the market. They have been tied up with the Lunar New Year holidays. That is not to say they will come back into the market causing an instant reaction but they can give us some demand news to trade from.
The focus will remain on South American soybean production this week. Is Argentina too wet? Is Brazil really that good looking?
Wheat summary… It is encouraging is to see the 3rd weekly higher close for the wheat despite nearby neutral fundamentals. Technically, higher wheat futures are extremely important this time of year. Fundamentally, we view the weekly export sales as neutral for this week.
The Philippines purchased 25,000 tonnes of feed wheat overnight. Officially it is optional origin but the trade views likely suppliers as either Ukraine or South America.
The private industry continues to up their estimates of potential Indian wheat exports. One report suggests they may export up to 2.5 million metric tonnes after June. The sales would only be made as special one time government to government sales.
An economist with the United Nations Food and Agriculture Organisation suggests 2010 wheat production could fall by 5%. .........more detail
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