CBOT Closing Comments - Fireworks!

There were indeed some fireworks Wednesday, as all the grains markets took a heavy battering, led lower by crude oil following Barrack Obama's US presidential election win. Obama, who favours a windfall-profit tax on petroleum producers and boosting renewable energy, is seen as a bearish President as far as the oil market is concerned.


Corn futures closed Wednesday's trade with steep losses in most contracts. Funds were quoted selling an estimated 7,000 contracts in the pit almost awash from Tuesday's trade. Ethanol profitability and financial concerns did ration demand for the 07/08 marketing year as total production came below USDA's estimates at 8.2 billion gallons. The Presidential election is over; traders will resume trading now that they know who will be in office. Weather turns ugly for the rest of the weekend and most likely halting harvest as snow and rain is forecast for much of the CB. Crude oil is selling off at midday down about $5 and is trading in the $66-$67 range. Dec -22 at 3.90.


Soybeans finished at least 50 cents lower in every contract that was traded throughout July '10. Funds sold an estimated 5,000 beans, 2,000 meal, and 3,000 bean oil contracts. Deliveries against the Nov contract are very minimal at 32. The dollar backed off from early morning lows and was near steady when the closing bell rang. Crude oil was about $5 lower during trade Wednesday at $65 per barrel, weighing in on prices as well as some profit taking from yesterday's impressive gains. Bean harvest should be near complete next Monday when USDA releases crop progress report as farmers rush to get the last of the beans out of the field before unfavorable weather hits. Nov -54 at 8.94; Dec Meal -12.80 at 265.00; Dec BO -1.95 at 34.02.


Wheat futures closed down 30 cents or more at CHI and KC and 24 cents lower at MLPS in the Dec '08 contract. Funds were net sellers of an estimated 4,000 CBOT contracts which added pressure to that exchange. Demand remains weak as wheat is plentiful around the world and possibly cheaper else where. Taiwan reportedly purchased 52,850 metric tonnes of US wheat. Drier weather has forced the Australian Government to reduce their wheat production estimate to 19.91 MMT which is down from the September guess of 22.46 MMT. Dec CHI -35 at 5.37; KC -32 at 5.76; MLPS -24 at 6.44.