Schwieterman: Corn demand remains strong

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Corn                                      Estimated Fund Position
Trends – March Contract
Short Term:Down                 Net Long Futures and Options: -173263
Long Term: Down                Change: +4000
Overnight Trade: H -1 @7:30 AM


The March corn is creeping towards the 40 and 50-day moving averages. A move to $4.35 in the March contract wouldn’t be a surprise today. Demand numbers are still strong and there is potential for yet another cut in the ending stocks estimate once we get to the January supply and demand report, which means there is still potential for year-end short covering by the funds.

Wheat                                    Estimated Fund Position
Trends – March Contract
Short Term: Down                 Net Long Futures and Options: -114996
Long Term: Down                  Change: -1000
Overnight Trade: Chicago: H Unch KC: H +2 @7:30 AM


The wheat market had a flash of brilliance yesterday and took out the previous day’s high for the first time in ages, but the market eventually failed and posted an outside day down on the charts. The March KW was a little firmer overnight, but we will have to see a move to $6.62 to get anyone excited about the wheat. Chances are that we will continue to see demand from Brazil, which will draw down our HRW ending stocks to very low levels. There is still potential for strength in the wheat, but we haven’t got a sign of a turn in the market yet.

Soybeans                                Estimated Fund Position
Trends – January Contract
Short Term: Up                       Net Long Futures and Options: 137672
Long Term:Up                         Change: +4000
Overnight Trade: F +2 @7:30 AM


The January soybeans held at trend line support yesterday and rebounded back towards the middle of the recent range. The news is still the same. There is a little bit of concern about the Argentine weather, a little concern that the Chinese haven’t quit buying US beans, and the fear that eventually the Chinese buying will stop. This is a recipe for range bound trade, so plan on that continuing.



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