Corn, soybeans close lower
DES MOINES, Iowa (Agriculture.com)--The corn, soybean and wheat markets closed before they could take advantage of the supporting news that China will bail out the European banks Wednesday.
The Dec. corn futures closed 13 1/2 cents lower at $6.37 1/4. The Jan. soybean contract settled 14 cents lower at $12.19 3/4. The Dec. wheat futures ended 16 3/4 cents lower at $6.19 1/2. The Dec. soymeal futures settled $5.20 per short ton lower at $317.00. The Dec. soyoil futures closed $0.61 lower at $50.89.
In the outside markets, the NYMEX crude oil is $2.64 per barrel lower, the dollar is lower and the Dow Jones Industrials are up 162 points.
It's China to the rescue! China will buy bonds from Europe's banks, bailing them out of their debt crisis. As a result, the U.S. stock market jumped, the dollar weakened. But, the announcement was made after the grain markets closed. The details of the deal won't be officially finalized until the European bank officials vote in November, reports indicate.
Joe Bedore, FC Stone Inc. CME Group floor manager says a bull market needs to be fed.
"We don't have any of that today. The idea being promoted was that technically the market was holding up, and as a result it was going to move forward. However, we haven't played technicals on this floor in years, regarding relying on them to move the market upward," Bedore says.
Simply put, the markets are looking for any news. The market couldn't handle the selling, despite light volume, Bedore says.
"Now, we have broken through the technical levels to the downside and we're hearing corn is headed to $6.22-$6.25 and soybeans to $11.88. Without being fed any news, you have to believe that's where we are going," Bedore says.
Meanwhile, the Europe's debt crisis has been in the news for so long that it's built into the grain market, he says. But, if the EU announcement will not have much affect unless it fails.
Jack Scoville, PRICE Futures Group vice-president, says the market finally figured out that the EU situation will not get solved overnight. "So, people decided to sell their positions," Scoville says. "Plus, the Dollar was unchanged when I walked in to work, then went $5.00 higher. Crude went lower but does have a fundamental there."