Issue Date: October 09, 2009
Higher Corn and Beans and a Weaker Dollar Support Wheat
The wheat market has recently enjoyed support from higher corn and bean markets and a weaker dollar to correct oversold conditions. Additionally, these markets are garnering some support from an increase in tender activity. There certainly are not any supply concerns, but these markets need buyers and they need improved global wheat demand to take place.
The market has rallied nicely from the lows experienced late last week and early this week. While this rally was triggered by big moves to the upside in corn and beans, based on expectations of a killing frost this weekend, the weakening of the US dollar has allowed the move to build momentum. I expect the market to reach levels that trigger selling, but the large net short fund position has limited my aggressiveness on this rally. As long as the greenback continues to weaken, the price of wheat futures can continue to increase. However, if the export pace remains slow, basis levels for most wheat varieties are likely to weaken.
By Brian Henry
|
Can Anyone Save The Dollar?
The sun may come out tomorrow but is anybody betting their bottom dollar that the dollar may find a bottom tomorrow? Come, what may the dollar has been the major influence on the petroleum prices and yesterday if only for a moment the dollar took a back seat to a wildly bearish Energy Information Agency oil inventory report. Still with the dollar talking another drubbing overnight the question is, can anyone save the dollar?
Well they may try. Yesterday Russia and China were reportedly buying dollars. Overnight Dow Jones news reported that the sinking dollar prompted a wave foreign exchange intervention by central banks in South Korea, Taiwan, the Philippines and Thailand seeking to limit damage to their export industries. Still half hearted intervention measures may only add to the dollars bearishness.
By Phil Flynn
|
Marketing Your Corn - 2009 Part IV
For those who were following the marketing advice in Part I and II of “Marketing Your Corn in 2009” a farmer would have had 40% of their 2009 crop sold at an average price of $4.45 basis Dec-09 futures. In Part III, which I wrote in early Aug-09, after the market had peaked the first few trading days in August, I recommended that a farmer price an additonal 10% of the crop at $3.70 on a retest of the early Aug-09 highs. For much of the past 2 months, Dec-09 corn prices never seriously challenged this price level until very recently, as Dec-09 corn prices peaked this week at the $3.70 level. Some of my clients were able to sell Dec-09 corn futures at this price. For those that were not able to I suggested we just go ahead and get the 10% priced on the fear that prices may have peaked, once we began trading below the 100 day moving average, currently near $3.66 (see chart below).
By Mark Soderberg
|
|
|
