eCBOT Close/Early Call/Nobody Saw This One Coming
eCBOT grains closed lower dragged down by falling crude oil and a strong dollar.
Beans closed around 9c lower, with wheat down 6c and corn one cent easier.
Crude is now firmly entrenched below $60/barrel. The gloomy global economic outlook seems to be capping any rallies in the grains sector.
So, if we are going to get a sustained rally then it needs to come from the supply side rather than being demand led. Corn could provide it, with over a quarter of the US crop still to be harvested, if the winter weather closes in.
On the wheat side, the Australian harvest is now underway and expected to produce a crop of around 20mmt, down on what was hoped for a few months ago, but still a substantial increase on 2007. The Argy crop is likely to be some 5mmt lower than last year, but that already seems factored into the market.
The nearest possible banana skin on the horizon for wheat would be a crop disaster in India, but that isn't likely to happen before Jan/Feb time.
This week's shockingly poor figures from Pacific Ethanol, hot on the heels of VeraSun filing for chapter 11 and a spate of other bankruptcies earlier in the year, seem to indicate that you don't want to be expecting any support coming from that sector.
How things have changed. Nobody saw this one coming did they?
See: Wheat, uranium, its all the same! posted 25th March 2008.
Early calls for this afternoons CBOT session: Corn futures are expected to open 1 to 3 lower; soybeans 7 to 10 lower; wheat 3 to 6 lower.
Beans closed around 9c lower, with wheat down 6c and corn one cent easier.
Crude is now firmly entrenched below $60/barrel. The gloomy global economic outlook seems to be capping any rallies in the grains sector.
So, if we are going to get a sustained rally then it needs to come from the supply side rather than being demand led. Corn could provide it, with over a quarter of the US crop still to be harvested, if the winter weather closes in.
On the wheat side, the Australian harvest is now underway and expected to produce a crop of around 20mmt, down on what was hoped for a few months ago, but still a substantial increase on 2007. The Argy crop is likely to be some 5mmt lower than last year, but that already seems factored into the market.
The nearest possible banana skin on the horizon for wheat would be a crop disaster in India, but that isn't likely to happen before Jan/Feb time.
This week's shockingly poor figures from Pacific Ethanol, hot on the heels of VeraSun filing for chapter 11 and a spate of other bankruptcies earlier in the year, seem to indicate that you don't want to be expecting any support coming from that sector.
How things have changed. Nobody saw this one coming did they?
See: Wheat, uranium, its all the same! posted 25th March 2008.
Early calls for this afternoons CBOT session: Corn futures are expected to open 1 to 3 lower; soybeans 7 to 10 lower; wheat 3 to 6 lower.
