- As this is written we are seeing another day with CBOT markets displaying a marked divergence with the soy complex making gains at the expense of wheat and corn. Seemingly further fund selling in wheat has led the way a weighed on corn prices. The selling was preempted by further snow forecast across the Plains, which will aid new crop but does not impact old crop!
- As mentioned last week the technical chart picture across all three crops looks decidedly bearish albeit with oversold conditions fast approaching, which may lend some short term support. Price dips are certainly attracting consumer interest, China with its strong soybean crush margins, continues to appear as an interested buyer on the decline.
- Despite Paris wheat being dragged lower by CBOT, the most notable feature is the inverse, or spot premium, which widened €12.5 on the close. It is little wonder that the trade of choice is nearby export; who would wish to hold grain to sell at a lower level in two months time?
- Southern Russia and Ukraine have experienced an extremely dry February after a stormy January period which helped to replenish low soil moisture levels. It appears that the region is caught in-between north and southern jet streams. Southern Russia experienced a dry autumn which extended into December, unusually as the normal conditions would be wet. Whilst there is no current cause for concern precipitation is necessary in coming weeks if crop stresses are to be avoided.