Corn trades over $5
CHICAGO, Illinois (Agriculture.com)--Speculators, weaker crop rating, and disappointing yields pushed the CME Group corn prices over the $5.00 price level Tuesday.
The Dec corn futures settled 11 1/2 cents higher at $4.95. The March corn futures closed at $5.08 1/4, May at $5.11 1/2, and July $5.14 1/4 per bushel. The Nov. soybean contract finished 1 cent higher at $10.35 1/2. The Dec. wheat futures closed 9 cents lower at $7.36. The Dec. soyoil futures ended 10 points lower at $41.71. The Dec. soymeal futures settled $3.00 higher at $296.50 per short ton.
In the outside markets, the NYMEX crude oil is $0.24 per barrel lower, the dollar is lower, and the Dow Jones Industrials are up 11 points.
Jack Scoville, PRICE Futures Group vice-president, says it was a wild day for the grain markets. "Corn and rice lead the way and corn was able to hold. The yield reports are just not good and the harvest is now into central Illinois and Indiana, so the trend is coming clear," Scoville says.
Scoville adds, "Bulls are targeting $5.00 Dec Corn for now, but I am now hearing people talk as high as $6.00, if the yields stay bad. Sounds pretty high to me. But, it could be possible later on. Wheat was not able to rally as the Aussies have a big crop over there and will provide tough completion with the US and EU in sales."
Soybeans rallied with corn, he says. "For me, it was mostly spec buying today, but I did tell some of my overseas guys to go ahead and get priced late yesterday and I think they did. So, there was a little commercial buying as well."
Tim Hannagan, PFGBest.com senior analyst, says the speculators are in the market heavily today. "The overnight market opened higher, pricing in the crop condition report, out after the Monday's close of trading, showing another 1% decline in the good-excellent condition in corn and beans. But, selling entered and carried over to the Tuesday opening."
Hannagan adds, "Traders and funds are heavily long with profitable positions. Traders are aware of the fund pattern of taking profits ahead of month-end yet the quick harvest in the corn market and farm talk of poor yields keep speculators buying dips in corn. That's what is happening today. We have had seven consecutive higher starts to the week on Mondays with seven straight lower Tuesday trade. Lows are occurring each Tuesday and or Wednesday weekly now with highs on Friday. But, traders are concerned about a bigger correction coming before positioning ahead of the October crop report begins."