November 28, 2014 Written by Chris Robinson Corn: March corn opened lower, bounced 7 cents early and then chopped lower through the rest of the abbreviated session to finally end down 3 ½ cents at $3.88 ¾ . For the week, CH lost 3 ½ cents on the week and oddly, down just ½ for the entire month. Exports today were very healthy coming in at 944,900 MT. This was up 4 percent on the week and 59 percent from the prior 4-week average. Monday we will get a fresh commitment of traders report, but given the short week and lack of movement, it most likely will be near last week’s tally of long 210K contracts. Hedgers: Protect 2015 bushels with a CZ15 4.00 put for 30 cents a bushel. Weather in South America continues to be favorable with ample rain recently and also forecast in the 10 to 14-day option. March corn has been chopping sideways for the past 2 weeks in the wake of the 4-month high at $4.01 posted on November 11th. This will continue to be the bull’s upside target for the time being. Support below comes at $3.75 which is a 1-month low. Wheat: March wheat opened lower and then took the escalator higher all day to finally settle up 15 ¾ cents at $5.78 ½ which is a 3-month high settlement. Today’s high tick at $5.81 was the highest price in 3 months and marked a $1.01 rally from the September 25th contract and 4-1/2 year low down at $4.80. Exports were good at 431,500 MT. This was up 19 percent from last week and up 16 percent from the 4-week average. Russia also announced new “phytosanitery requirements”. This is most likely a ruse so they can curb exports, most likely in retaliation for the current sanctions placed on them for their Ukrainian adventure. For the week, WH gained 25 cents. For the month, WH gained 32 ¾ cents. This week looked like a combination of continued short covering from the managed funds, and general worries about what’s going to come out of Russia next. Hedgers: Take advantage of the managed funds and Mr. Putin’s woes and get a floor on your 2015 grain. Soybeans: January soybeans opened lower spiked higher and visited the woodshed, skidding over 33 cents from high to low, to finally settle down 31 cents at $10.16. For the week, SH dropped 22 ½ cents. For the month, SH lost 30 ¾ cents. Exports were very strong at 1,485,400 MT. This was 34% higher than the previous 4 week average. Despite these good exports, SH could not hold a bid after about the first hour of trade. Today looked more like knee jerk reaction to the crude oil melt-down. For now there is major resistance at the $10.50 level on the daily charts, with the next resistance above at the 4-month high posted November 11th at $10.86. The biggest news today was the Saudi’s decision to keep pumping oil, damn the torpedoes, full speed ahead. Oil dropped almost $8.00 today, that’s 11 percent in one day. This is a 4 ½ year low in crude. The fact that it happened on a day most traders were still in a Turkey coma in the US probably made the move more violent. This corresponded to the US dollar moving to within spitting distance of its 4 ½ year high. What this all means will probably be clearer as we move through the year end. Monday is the first trading day of December. Only time will tell how much of an impact this will have on currency and grain markets. As always, it’s best to manage the risk, rather than to try to outguess these markets. Have a great and safe weekend. CER
