eCBOT Close, Early Call

The eCBOT grains traded either side in the overnight session, but ultimately ended up in negative territory with July soybeans down 1 3/4 cents, corn 3 cents lower and wheat 10 1/4 cents easier.

In a reversal of yesterday, crude and metals were lower and the dollar higher, all dragging the grains down as the morning session wore on.

Crude oil dipped on ideas that the recent rally has been overdone, speculatively driven and without too much focus on demand. July crude currently stands $1.49 lower at $71.19/barrel.

For soybeans it's still all about old-crop tightness. The US will not run out of beans everybody keeps re-assuring us, prices will ration demand, China have more than enough and will go away etc.

The USDA projected ending stocks at 110 million bushels earlier this week. That might be the lowest for 32 years, and the tightest stocks to usage ever, but it's still a surplus isn't it?

Well, that's true, but where were the physical ending stocks last year when the September contract closed more than four limits up on the last day of trade? They were more than double then what they are projected to be this year, but physically where the hell actually where they? Nowhere to be seen, floating around in the USDA ethereal, that's where they were.

The South Korean Feed Association bought 165,000 MT of US corn overnight. Nonghyup Feed Inc., also of South Korea, bought 275,000 MT of mixed US/optional origin corn.

South Korea also bought 55,000 MT of optional origin wheat and Algeria took 150,000 MT of the same.

The CWB peg the western Canadian grain crop 18-20% lower in 2009/10, saying that conditions have worsened considerably in the past two weeks.

Early calls on this afternoon's CBOT session: Corn Down 2-4c, Wheat Down 8-10c, Soybeans Down 3-5c.