China DDG Talk Sinks Corn
DES MOINES, Iowa (Agriculture.com)--Trade rumors about China blocking U.S. DDGs helped push the CME Group corn market to a lower close Monday. Also, soybeans had gains capped.
The July corn futures contract closed 8 cents lower at $4.51. The Dec. corn futures finished 7 3/4 cents lower at $4.50. The July soybean futures contract ended unchanged at $14.57. The Nov. soybean futures closed 5 1/2 cents higher at $12.24. July wheat futures closed 5 3/4 cents lower at $6.12. The July soymeal futures contract finished $5.40 per short ton lower at $482.20. The July soyoil futures settled $0.27 higher at $39.28. In the outside markets, the NYMEX Brent crude oil is $1.71 per barrel higher, the dollar is higher, and the Dow Jones Industrials are 8 points higher.
Monday's trade rumor is that China has found an unapproved GMO gene, MIR 162 in DDG shipments from the U.S. As a result, the country has stopped issuing import licenses for DDGs. It is applying significant pressure on the corn market Monday.
Jack Scoville, PRICE Futures Group vice president, says corn is down big today on the news that China will not buy DDGs.
"I kind of feel we might be making a temporary low on this kind of news," Scoville says.
Wheat is lower too on good planting weather and good harvest weather for the winter crops, as well as cheaper overseas prices, he says. "Wheat should be near some kind of low, too. Prices are starting to turn higher on Russia, so maybe the extreme downside pressure is passing. But there is nothing around to make for a long-term move higher, maybe we just level off for a while."
The big action is in beans and especially the July-Nov spread. "It has been a yo-yo today. Broke support but rebounded right back. We still got the roll this week, so this might be short-lived. Beans looking good out there, too, and the crop ratings should be very high – for corn, too."