Morning CME Globex Update:
March soybeans were up 7 3/4 cents and March soybean meal was up $4.00 at the morning break after another weekend of mostly dry weather for Argentina. All three wheat prices were modestly higher with a mix of snow and rain falling from Nebraska to the Great Lakes.
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At 8 a.m. CST, USDA reported 10.1 million bushels (256,096 mt) of U.S. corn were sold to unknown destinations for 2017-18. March corn was down 1/2 cent earlier Tuesday, staying quiet in its sideways range while Monday's turbulent events settled down. For one, U.S. lawmakers reached an agreement to keep the government open until Feb. 8. Monday's second event, a winter storm across the Midwest has pushed eastward with lighter patches of snow around the Great Lakes and rain in the northeastern U.S. The next seven days are expected to be drier for the Corn Belt with precipitation in the eastern third of the U.S. In South America, this week's forecast is mostly dry, except for rain in northern Argentina. Otherwise, there is not much happening to move winter corn prices in a strong direction either way. The trend in March corn remains sideways with traders holding net short. DTN's National Corn Index closed at $3.20 Monday, priced 32 cents below the March contract and near its highest price in five months. In outside markets, the March U.S. dollar index is down 0.05, not showing much response to a temporary reopening of government. Outside commodities are mixed.
March soybeans were up 3 1/2 cents early Tuesday, still getting some benefit from dry weather concerns in Argentina. Tuesday's satellite map still looks mostly dry for the region, but northern Argentina is expecting rain in this week's forecast. Brazil's crop areas are expected to be drier this week. While Brazil appears to be headed toward a large, 4.0 billion bushel soybean harvest, the outlook for Argentina is not as clear and the persistence of dry weather has brought at least a temporary pause to the downtrend that prices began in mid-December. It is still difficult to see a bullish fundamental argument for soybean prices in this situation and so far, the trend in March soybeans remains down. DTN's National Soybean Index closed at $9.14 Monday, at its highest in a month and priced 70 cents below the March contract.
March Chicago wheat was down 3/4 cent early Tuesday, staying safely in the middle of its sideways range, caught between bearish traders holding a large commitment of net shorts and commercial firms willing to take advantage of the value offered at these low prices. The result so far, has been that prices are stuck in a sideways trading range with little disruption likely to happen in the winter months. One factor with potential to become important this spring is the drought in the western and southern U.S. Plains. It certainly isn't going away this week with almost no rain expected in the Plains, west of the Mississippi River. For now, the trend in winter wheat remains sideways with noncommercials vulnerable to bouts of short-covering. DTN's National SRW index closed at $3.95 Monday, priced 31 cents below the March contract and down from its highest price in three months.
Todd Hultmancan be reached at email@example.com
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