- Wednesday’s Chicago markets have seen prices move lower and bullish input has been lacking. It appears that our thoughts that the big drop in open interest suggesting that we were in the final stages of a short covering rally may well prove correct – ti e will prove us either right – or wrong! Fresh buyers appear scarce to say the least, and leave prices open to correction lower in coming days unless we see new buyers step up to the plate – and quickly. The long fund holders appear reticent to add to positions and chase the rally, although it could well be they buy breaks lower to build on positions and use their volume buying power to protect their fresh longs.
- There are a number of unknowns in the soybean market, Argentine crop size and quality, Chinese demand in the face of negative crush margin – can it continue, will the US plant an additional two million acres in the light of higher prices. A few issues that could change the big picture!
- The EU’s crop monitoring arm (MARS) increased its 2016 crop estimates in yesterday’s release; soft wheat yield was increased to 6.11 mt/ha from 5.96 estimated last month, winter barley was also uplifted to 5.97 mt/ha from 5.82 a month ago and rapeseed was also increased to 3.35 mt/ha from 3.31 last month. Clearly early season weather has bee beneficial from a grower’s perspective.