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Corn, soybeans end sharply lower

05/22/2012 @ 9:37am

DES MOINES, Iowa--(Agriculture.com)--Favorable weather and world economic troubles spooked speculators, causing that investment group to liquidate commodity positions Tuesday. 

As a result, the CME Group corn, soybean and wheat markets closed sharply lower.

The July corn futures settled 36 cents lower at $5.97, while the Dec. contract closed 20 1/2 cents lower at $5.20. The July soybean contract finished 30 1/4 cents lower $13.81 1/4, while the Nov. 2012 contract finished 24 cents lower at $12.82. The July wheat futures closed 18 1/2 cents lower at $6.85 1/2. July soyoil futures ended down $0.35 at $50.57. The July soymeal futures settled $11.00 per short ton lower at $405.50. 
In the outside markets, the NYMEX crude oil is $1.01 per barrel lower, the dollar is higher and the Dow Jones Industrials are up 45 points.

Tim Hannagan, PFGBest.com senior grain analyst, says an updated weather forecast builds in rain for next week.

"Today, Tuesday, WXRISK.COM now sees a rain potential for Monday and Tuesday in the upper Midwest of North Dakota, Minnesota, Wisconsin and Michigan. Here's the problem. It's only Tuesday and by Thursday or Friday it could be called to move further south into the heart of the Midwest Corn Belt. Should that forecast be realized, traders won't want to buy long adding risk with a three-day holiday ahead," Hannagan says.

Jack Scoville, PRICE Futures Group vice president, says weather and macronews keeps pushing farm markets lower.

"We are dumping out with lots of default talk from China around. I saw it for coal and iron, but not beans. But, I suppose there is talk about it with the government ready to auction off 600,000 tons on Thursday there," Scoville says.  

Other than that, no demand news, a stronger US Dollar, and good condition and progress ratings have people negative, he says.  

"A bearish day here in Chicago, but we seem to be trying to find a place to hold now.  Charts suggest that downside should be limited from here.  

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