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Soy, wheat stay strong

Updated: 08/17/2011 @ 11:02am

CHICAGO, Illinois (Agriculture.com)--Trading on more of outside market factors and less about fundamentals, the CME Group grain and soybean markets remain higher Wednesday.

At mid-session, the Dec. corn futures are trading 1 cent higher at $7.28 1/2, while earlier today hitting a high for the year. The Nov. soybean contract is trading 12 1/2 cents higher at $13.62. The Sep. wheat futures are 6 3/4 cents higher at $7.31 1/2. The Dec. soyoil futures are trading $0.73 higher at $56.27. The Dec. soymeal futures are trading $1.30 per short ton higher at $358.70.

In the outside markets, the NYMEX crude oil is $1.22 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 31 points.

Tim Hannagan, PFGBest.com senior grain analyst, says the markets are being pushed up by outside influences.

"The outside markets are favorable for the grains. This is sending a message to Index and trend-following funds to buy commodities," Hannagan says. 

However, beneficial rains that are expected to hit the Midwest this weekend are capping gains, he says. Corn is making highs for the year, for the second day in a row. The soybean and wheat markets are still trying to catch up to corn's fast trading pace. 

"Keep in mind month-end profit-taking is right around the corner. It's believed the funds will take profits and then turn around and get long before the September 12 USDA Report," Hannagan says. 

Also, the worst ever drought in the Plains states has some thinking the U.S. winter wheat plantings will drop, he says. "Much like Russia experienced a year ago, the U.S. wheat market could explode from significantly lower wheat acres."

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