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Grains tank on EU debt, MF Global news

Jeff Caldwell 10/31/2011 @ 11:04am Agricultural content creator and marketer.

Worries about the European debt crisis and fresh concerns about the news that a major trading firm has filed bankruptcy have the grains trading sharply lower in early Monday trading.

At 11:00 AM CST, December corn futures were 14 cents lower at $6.41 per bushel, while November soybeans were 19 cents lower at $11.98 and December wheat was 22 3/4 cents lower at $6.21 3/4, according to Barchart.com.

Though there's been a lot of bearish news for the grains lately, one saving grace could be the volume of Monday's trade in general, says Derivitaves manager for ICAP Energy LLC and Agriculture.com Market Analyst Scott Shellady. Monday has typically been the quietest trading day of the week over the last few weeks, he says, and that could keep the floor from falling out from under the grains.

"Here we go again. Speculators in Europe have begun to attack Italian bonds and we continue to lurch from one headline to another here in the states with the MF chatter dominating the wires," he says. "The market is under pressure and will trade that way today as we continue to suffer from Thursday's ridiculous rally and the constant drip drip drip of unsettling news our of Europe. Play defense. Mondays have been quiet as of late."

"MF chatter" is a reference to the news Sunday night that the trading and analysis firm MF Global was filing for bankruptcy protection. The global trading firm, of which the grain trading arm is just a part, reported a $191.6 million quarterly loss earlier this month, leading its credit rankings to be classified as "junk" by some major investment services, reports indicate.

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