Soybeans closed lower on profit taking and a lack of follow through buying. Contracts saw early support from the outside markets but weren’t able to sustain those gains. Near term fundamentals look good, but the trade’s keeping an eye on the expected record South American crop and expects China to cancel at least some export purchases, combing to push beans to near four month lows. There are some concerns about this week’s weather in parts of South America but Argentina, Brazil and Paraguay are expected to see a more beneficial weather pattern fairly soon. Soybean meal was lower on a lack of follow through buying, spillover from beans and product spread trade. That spread trade and a sharply higher move in crude oil kept bean oil on the plus side.
Corn was higher on short covering, technical buying and outside market direction. In the outsides, the dollar was lower while the Dow, gold and crude oil were higher. Corn was due for a bounce and demand has increased after the recent losses. Also, there are continued concerns about the quality of 2009’s crop. Still, the supply’s large, cancelling out some of that demand support and keeping contracts moving in a very narrow range on Monday. Weekly export inspections for corn were solid, above what’s needed weekly to meet USDA projections for the 2009/10 marketing year. The overall good crop weather in South America is also a negative for corn. Ethanol was modestly higher.
The wheat complex was fractionally higher on technical buying, short covering and outside market direction. The dollar was down, which lowers the price of U.S. goods on the export market, cancelling out some of that U.S. premium over other origins. That said – fundamentals remain very negative with a large supply and no real new demand, which limited gains during Monday’s session. European wheat was higher on a lack of new selling interest. Algeria bought “at least” 50,000 tons of optional origin milling wheat.
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