CNS Canada — Corn, soybean and wheat futures in the U.S. are awaiting the latest U.S. Department of Agriculture (USDA) reports, but traders aren’t expecting the reports to much of an effect on prices.
USDA releases its quarterly grain stocks and small grains summary reports on Friday.
“It basically wraps up the 2017-18 crop year for the U.S., which is already behind us. So whatever they report for stocks will influence the carry-in for the new crop. But traders are not looking for much change in what the USDA already predicts,” said Terry Reilly, a senior commodity analyst with Futures International in Chicago.
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There were good gains for the Chicago soy complex during the week ended Feb. 4, due to positive news that Wednesday.
However, Reilly said he is looking for corn ending stocks to be much higher than what USDA has forecast, which could present a bearish undertone for the market.
Most market participants aren’t looking for much to change from previous USDA numbers, according to Reilly. The wheat numbers will be outdated by the time they are released, so most traders won’t pay attention to those either, he said.
“What (traders are) doing (now) is lifting positions off the table just in case there’s a surprise in these numbers… so we’re seeing a little bit of basically short-covering,” he said.
Traders are starting to place a weather premium into corn and soybean markets on the Chicago Board of Trade. Wet weather has caused harvest delays in both Canada and the U.S., which, according to Reilly, could stop both commodity contracts from hitting fresh lows.
He expects the November soybean contract to trade in the $8.35-$8.65 per bushel range, while the December corn contract could trade in a wide $3.50-$3.75 per bushel range (all figures US$).
U.S. wheat futures are seeing strong global demand which is supportive for the markets. Better weather conditions in Europe, allowing producers to seed winter cover crops, is tempering gains and keeping the contracts in a sideways trading range.
— Ashley Robinson writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.
