Corn, soybeans close higher
CHICAGO, Illinois (Agriculture.com)--The CME Group corn and soybean markets close strong Friday, setting up a higher start to next week, analyst says.
The Dec corn futures closed 5 1/2 cents higher at $4.27 1/4. The Nov. soybean contract closed 15 1/2 cents higher at $10.44. The Dec. wheat futures settled 9 1/2 cents lower at $7.34 1/4. The Dec. soymeal futures contract ended $0.50 per short ton higher at $296.70. The Dec. soyoil contract settled $1.31 higher at $43.14.
In the outside markets, the NYMEX crude oil is $0.34 per barrel lower, the dollar is higher, and the Dow Jones Industrials are up 9 points.
Tim Hannagan, PFGBest.com senior analyst, says traders are trading weather on foreign growing ports, not yesterday's USDA report.
"After no surprises in the USDA report, traders turned right away to trading the weather concerns. The market is asking how is the weather in the Black Sea region, in India, China. India, the second-largest producer/exporter of wheat has now suspended all wheat exports. India is reporting poor rapeseed and rice crops. So, India could be in the market looking to buy high-protein soybeans."
In addition, Russia's drought problems still lead the world weather concerns.
Meanwhile, the soybean market is getting exciting, Hannagan says.
"The next shoe to drop, for this market, is the realization that eastern Europe and Russia's soybean and corn crops may be hurting. In the 1970's, it was shown Russia and the EU countries grow corn and beans for their own needs, only entering the world market when they have shortfalls. So, the thinking is Russia may be in the market for corn and soybeans, if they are going to maintain their livestock."
To thicken this demand plot even further, China's recent gigantic purchases of U.S. soybeans may be indicating that country believes that EU countries could be in the market for U.S. soybeans soon. As a result, China, that normally slows U.S. soybean purchases in August, waiting for a fresh fall U.S. crop, is trying to capture supply before irregular buyers step-in, Hannagan says.
Heading into the weekend, a Dec. corn contract close on Friday of $4.26 signals a strong technical finish, Hannagan says. "This would spark a higher open for Monday, before profit-taking Tuesday, Hannagan says. For Nov. soybeans, a close, today, over $10.36 tells technicians to buy, buy, buy, and Monday's trade could be higher," he says.