** 6:30 AM CDT CBOT Prices: January soybeans are up 2.00 cents at $9.9775, Dec corn is down 1.0 cent at $3.4675, while Dec Chi wheat is down 2.50 cents at $4.2475.
** AgResource AM Grain & Oilseed Comment: Good Morning! Pre report positioning has created a mixed CBOT in the early AM hours. Funds continue to push their long soybean/short grain spread position as traders bet on a decline in the 2017 US soybean yield and an increase in corn.
A push above last week’s high of $10.005 in January soybeans is likely to fuel additional chart based buying, while a push below last week’s low ($3.4525) in December corn would fuel additional chart based selling. The spot soybean/corn spread has risen to 2.85:1 as the market tries to deal with all of the US corn and a smaller pile of soybeans. The charts of CBOT soybeans and CBOT corn look totally different.
Tuesday’s CBOT preliminary open interest indicated a 729 contract gain in corn, a 618 contract gain in soybeans, and a 7,547 fall in wheat.
There were 133 contracts of November soybeans tendered for delivery. ABM AMRO put out an additional 100 contracts of November soybean receipts.
Egypt’s GASC is seeking world wheat for December 15-30th shipment. The lowest offer was $195.30/MT fob for Russian wheat. This is down around $2.50/MT from their last tender and is deemed slightly bearish. It’s expected that GASC will secure 3-5 cargoes of Russian wheat in this tender.
China imported 5.86 MMTs of soybeans during October, which was down 28% from September, but up from last year’s 5.12 MMTs. Based on vessel loadings, analysts were looking for a total closer to 6.2 MMTs. The slower October import pace could push December and January soybean imports closer to 9.0 MMTs as crushers push demand ahead of their Lunar New Year holiday.
Argentine President Macri stated that Argentina will fight US biodiesel tariffs at the WTO. The battle is likely to take years, but like the recent EU decision and return of Argentine biodiesel trade, President Macri is hopeful for a favorable outcome for Argentina.
European wheat futures are unchanged with Paris December at $161.75/MT. Malaysian December palmoil futures closed with strong gains amid concerning weather that palm production could be lowered by excessive rains into yearend. The December futures contract settled 32 ringgits higher at $2,800.
US President Trump has arrived in Beijing for diplomatic meetings. Dalian corn/soymeal futures closed with very modest gains in reduced volume trade. South America weather is favorable for the next 10 days. Additional rain will benefit Northern Brazilian soy crops through the weekend while some needed drier weather advances spring planting across Argentina and S Brazil. High temps to range from the mid 70’s to the lower 90’s – which is seasonal.
ARC looks for another day of buying soy/selling grains ahead of the USDA report tomorrow. We doubt that corn can drop too far amid a record fund short.