- Chicago prices are mixed at midday with the grains firmer while the soy complex is weaker. The soy complex is still suffering from fund long liquidation in soymeal while funds enter a larger net short position on soybeans and soyoil. It has been a largely technical week with traders squaring positions ahead of the coming Christmas Holiday. Normally, like Thanksgiving, there tends to be some sort of bounce into the long holiday weekend with the shorts always more nervous about their positioning. Chicago brokers estimate that funds have bought; 4,100 contracts of corn and 1,900 contracts of wheat, while selling 3,800 contracts of soybeans. In soy products, funds have sold 3,100 contracts of soyoil and 1,200 contracts of meal. Fund traders have come out of long soybean vs short grain spreads, and are now entering a net short soybeans position.
- US sorghum sales are soaring with another 17.2 million bu sold last week. For the crop year to date, the US has sold 158.4 million bu of sorghum, which accounts for 61% of the projected annual exports. China remains on a purchase pace that they could easily run the US short of sorghum. USDA has already sharply curtailed US sorghum feed and industrial use, making any future monthly reductions difficult. US corn will be left to find larger tonnages of US feed and industrial demand based on the void that stronger sorghum prices are now leaving. US elevators/banks report that US farmers have been larger sellers of cash corn/soybeans as their need for cash increases, and bankers force sales before the New Year. This could account for a portion of the open interest increase in Chicago corn futures in the past two weeks. A “give up” mentality prevails in the country as farmers give up on the prospect of a Chicago rally.
- It is all about the technicals with soybeans lower and the grains firmer. Fund managers want to see if March corn can close above its 20 day moving average at $3.5125 and if better rains can fall across the parched areas of Argentina The holidays and the end of the year loom with many traders loath to take on new positions. The grains should bounce.