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Soybeans show most strength

Updated: 10/16/2012 @ 4:41pm

DES MOINES, Iowa (Agriculture.com)--The CME Group corn and soybean markets finished only slightly higher Tuesday following a slew of profit-taking Tuesday.

The December futures corn contract closed 1 cent higher at $7.38. November soybean futures contract finished 1 1/4 cents higher at $14.93. December wheat futures close 1/4 of a cent lower at $8.47 per bushel. The December soyoil futures contract is trading $0.46 higher at $50.47. The December soymeal futures contract settled $3.30 per short ton lower at $452.80.

In the outside markets, the NYMEX crude oil is 16 cents per barrel higher, the dollar is lower, and the Dow Jones Industrials are 105 points higher.

Tim Hannagan, Alpari (U.S.) LLC, senior grain analyst, says that after breaking hard Monday on a continuation of the harvest price correction the markets have been in since last month, profit taking is occurring Tuesday. 

"This pulled grains up in early trade, but they sold the rally into mid-session. It's hard for corn to hold gains, as demand has dropped to marketing year lows even after a $1.10 break in price," Hannagan says. 

China's corn is cheaper than U.S. corn now, and without China buying it indicates that the market has to find a price lower to find foreign business, Hannagan says. 

"Domestic feeders and ethanol guys await harvest low signals before they will enter. That price for corn could be in the gap at $6.75. We're still $1.80 higher than a year ago at this time. We could see some more price strength Thursday, if rumors turn out to be true that China was indeed buying large bean tonnage last week. 

If realized, those sales will show up on Thursday's weekly export sales report. "A report day rally will be sold with a resumption of the harvest correction," he says.

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