CNS Canada – Chicago Board of Trade (CBOT) soybean contracts could see some action this week as the November contract near expiry. The corn contracts could also be hopping around during the week.
“We’re getting some pressure in these markets because of the harvest pace that’s going on for the U.S. producer. So farmers are out there, they’re getting their work done,” said Steve Georgy, president of Allendale Inc.
While the soybean harvest is behind schedule compared to years past, yields are looking good still. The market has also seen some pressure from the ongoing trade war between the United States and China. Some large sales of soybeans were also cancelled during the last week.
“All that compiled together is what’s keeping beans about where they’re at. November beans around US$8.50 a bushel is kind of a happy spot. If we go much below that we see demand start to kick in…but much above that you’ve got producers selling and able to take advantage of a little bit higher prices,” Georgy said.
The market should be choppy for the rest of the week though as traders adjust their positions before the November contract expires.
“Overall harvest is going to keep any kind of big rally from happening at this point unless we see something done with trade,” Georgy said.
The CBOT corn market is currently stuck in a sideways pattern with the lows already priced in, according to Georgy. He expects the market to chop around at the US$3.70 per bushel mark.
“Any time you get a big bounce for corn or you see that move higher it’s met with selling because farmers need to find a home for (the crop),” Georgy said. The U.S. corn harvest is just over 50 per cent complete and farmers could be looking to sell some of the crop as it comes off the combine.
The corn market though could find itself being influenced by the wheat market. The CBOT wheat market is currently range bound at around the US$5 per bushel mark and if the export pace picks up Georgy thinks that it could move higher.
“If we can get the wheat market to jump higher that may influence that corn to push a little bit higher as well,” he said.