AG MARKETS FINISH MOSTLY HIGHER THURSDAY

INVESTORS REMAIN LONG, A BET THE PRICES GO HIGHER, IN THE CORN AND SOYBEAN MARKETS.

On Christmas Eve’s trading day, the CME Group’s farm markets close mostly higher.

At the close, the March corn futures closed 3¾¢ higher at $4.51. May corn futures finished 3½¢ higher at $4.51¾.

January soybean futures settled 4¾¢ higher at $12.63. March soybean futures finished 4½¢ higher at $12.64½.

March wheat futures finished 2¾¢ lower at $6.27.

March soymeal futures closed $4.90 per short ton higher at $414.10.

March soy oil futures settled 0.52¢ higher at 41.13¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.11 per barrel higher (+0.23%) at $48.23. The U.S. dollar is higher, and the Dow Jones Industrials are 70 points higher (+0.23%) at 30,199 points.

Bob Linneman, Kluis Advisors, says that investors are mostly long the market, leaving no selling pressure.

“As the year winds down, the grain market continues to push higher. A softer-than-expected weekly export sales report on Wednesday (a day earlier due to the holiday) did not slow the bulls down. Soybean and corn prices pushed to new contract highs. There are very few in-the-money puts vs. in-the-money calls in the corn and soybean markets for option expiration today. Traders are likely holding long call spreads. There is no selling pressure to stop prices from climbing. As prices climb, those traders who are short call spreads have started to feel the squeeze. Will the trend continue next week as fund managers complete their ‘window dressing’ (i.e., adjust their positions) for year-end?” Kluis noted in a daily note to customers.

Linneman added, “The trade has known for a few months that soybean ending stocks are going to be tight. Has the rally over the past two weeks pushed prices high enough to ration demand? With U.S. ending stocks likely to break under 100 million bushels in 2021, who is willing to give up possession of physical soybeans?”

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Wednesday’s Grain Market Review

Soybean and grain futures surged Wednesday in thin trading ahead of the three-day weekend.

Rinafall is helping build soil moisture in parts of Brazil, the world’s biggest exporter of soybeans, though stress likely will build in the next week, Commodity Weather Group said in a report.

In Argentina, showers are expected in some growing areas this weekend, but the best chance for precipitation will be Monday and Tuesday, the forecaster said. Stress likely will rebuilding for the southern half of the country’s crop-producing regions.

March soybean futures closed 11¢ higher at $12.61 a bushel on the Chicago Board of Trade.

March wheat futures jumped 13 3/4¢ to $6.30 3/4 a bushel.

Soymeal futures rose $4.80 to $419.10 a short ton.

March soy oil futures were up 0.64¢ to 40.6¢ per pound.

In the outside markets, the NYMEX crude oil rose 2.2% to $48.03 a barrel. The U.S. dollar was higher, and the Dow Jones Industrial Average gained 0.4% to 30,129.83.

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets watch investors position themselves ahead of the Christmas holiday.

At the close, the March corn futures finished 3½¢ higher at $4.43¾. May corn futures are ¾¢ higher at $4.44.

January soybean futures closed 4¢ higher at $12.47½. March soybean futures closed 2½¢ higher at $12.50.

March wheat futures settled 5¾¢ higher at $6.17.

Jan. soymeal futures settled $2.70 per short ton higher at $415.00.

March soy oil futures closed 0.41¢ higher at 39.96¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.95 per barrel lower (-1.98%) at $47.02. The U.S. dollar is higher, and the Dow Jones Industrials are 161 points lower (-0.53%) at 30,055 points.

Al Kluis, Kluis Advisors, says that investors will be watching South America’s crop weather updates and Argentina’s port strike for price direction.

“The ability of the grain market to rally back on Monday shows good commercial demand on any setback. Many end users in the U.S. and around the world have limited coverage going forward,” Kluis stated in a daily note to customers.

Kluis added, “I am watching the ongoing strike at the ports in Argentina. Many boats are waiting to load soybeans and soybean meal. Some of the meal export business is now shifting to the United States. This is creating a huge rally in nearby soybean meal, and it’s one of the main reasons the soybean rally continued on Monday. If the strike is settled, then watch out for soybean meal and nearby soybean prices.”

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Monday’s Grain Market Review

On Monday, the CME Group’s soybeans close 23¢ higher.

At the close, the March corn futures finished 2 1/2¢ higher at $4.40 1/2. May corn futures closed 2 3/4¢ higher at $4.42.

January soybean futures settled 23 1/4¢ higher at $12.43. March soybean futures settled 23 1/2¢ higher at $12.47 1/2.

March wheat futures finished 3¢ higher at $6.11 1/2.

Jan. soymeal futures closed $6.80 per short ton higher at $412.30.

March soy oil futures finished 0.12 of a cent lower at 39.55¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.31 per barrel lower (-2.67%) at $47.79. The U.S. dollar is higher, and the Dow Jones Industrials are 92 points higher (+0.44%) 30,271 points.

Al Kluis, Kluis Advisors, says that investors will be watching South America’s crop weather updates for price direction.

“It was another dry week, last week, across most of Argentina. The hit-and-miss rain pattern continued in Brazil. The week one and two forecasts again bring more rain to Brazil, while Argentina stays mostly dry.  My source on Brazil reduced his corn crop projection for Brazil by 2 million metric tons (mmt). For Argentina, he reduced the corn and soybean crop projections each by 1 mmt. Going forward, he has a negative outlook for crops in both nations,” Kluis stated in a daily note to customers.

Kluis added, “Watch crop conditions in Argentina. The report last week from Argentina rated their corn crop 24% good to excellent. This is down 18 percentage points from last year. For soybeans, the ratings are 50% good to excellent. This is down 5% from last week and down 3% from last year. We are watching the direction of the trend, not just the numbers.”

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