Farm markets close stronger
DES MOINES, Iowa (Agriculture.com)--Though thought to be moving higher off of fresh fundamental deemed, the CME Group corn, soybean and wheat markets rallied Friday off of technical drivers, some marketwatchers say.
The March corn futures settled 5 1/2 cents higher at $6.41 3/4. The March soybean contract closed 9 1/4 cents higher at $12.67 1/2. The March wheat futures settled 15 1/4 cents higher at $6.44. The March soymeal futures ended $1.70 per short ton higher at $332.50. The March soyoil futures closed $0.35 higher at $53.40.
In the outside markets, the NYMEX crude oil is $0.74 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 40 points.
Joe Bedore, FC Stone's CME Group floor manager, says the rally is based off of technicals rather than fundamentals.
"We've hanging more towards the highs vs. the lows. At some point, the market attempts to break through those levels. And, I think that's what is happening here. The trader that is short the market is getting blown out of the market. That trader is gone for the weekend. That short trader has decided to not battle this uptrend right now," Bedore says.
The fundamental traders are letting the technical traders have their day in the sun and just get to the sidelines, Bedore says.
Meanwhile, the big soybean sale to China, announced Friday, and the news that Ukraine may suspend wheat exports, has no market impact, one grain analyst says.
"I'm being told that it's Friday, we are headed for a long weekend, and the rally is based upon the short-covering that is going on," Bedore says.
Separately, the corn trade is starting to believe the old-crop corn contracts are under-priced and the new-crop corn futures prices are over-priced.
However, the soybean trade minds see the old-crop soybean contracts over-priced and the new-crop futures contracts are not as high as they should be, based upon the lower crop estimates in South America.
On Friday, the USDA announced fresh export grain and soybean demand. Surprisingly enough, some grain analysts believe short-covering, not new export sales is driving the markets Friday.