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All grains close lower

01/04/2011 @ 9:41am

CHICAGO, Illinois (Agriculture.com)--Just as they opened, the CME Group agricultural commodities finished lower Tuesday. Mainly, profit-taking swept across the floor, igniting a lower trading session.

The March corn futures settled 12 cents lower at $6.08 1/2. The March soybean contract ended 7 cents lower at $13.72. The March wheat futures closed 16 1/2 cents lower at $7.89. The March soybean meal futures settled $2.30 lower per short ton at $366.70. The March soyoil futures settled $0.75 lower at $56.95.

In the outside markets, the NYMEX crude oil is $2.17 per barrel lower, the dollar is higher, and the Dow Jones Industrials are up 14 points.

Tim Hannagan, PFGBest.com senior grain analyst, says two selling issues entered today's market sending prices lower. "One, more forecasters are leaning to a wet forecast in Argentina this weekend, with several suggesting two more rains will follow in the 15-day outlook. The weather rally in corn started at $5.42 and beans at $12.00, basis March futures. So, there's plenty of weather premium to extract if rains continue. 

The second selling source was funds selling the board, including everything from hogs, cattle, grains, softs, metals, energies, Hannagan says. "Last year, selling buy funds began after the January USDA Crop Report and the year prior on January 2. This year, funds need to get out of thousands of longs loaded upfront before re-positioning into longer term contracts."

Luisa Longo, a CME Group floor trader with Trademaven, says the profit-taking and a stronger U.S. dollar have a grip on the market. "I see any weakness as a buying opportunity as there is still strong demand from China and weather concerns in South America and Australia still plague the crops."


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