Grains Tightly Locked to the Financials Again Today
A sharply lower to possibly limit down opening is expected, following the financial markets this am. The fate of the grains will probably be locked tightly to the financial markets all day and the financials are likely to be painfully lower all day. Traders will focus on the equity and credit markets today along with the energy and metals as well as the $, which is screaming higher - a bad sign for all commodities, including grains.
Pakistan's Agriculture Minister said Pakistan will import 750,000 tonnes of optional origin wheat within the next 2 weeks. Malaysian palm oil fell 160 ringgit today.
Over the last 24 hours, southwest Australia had up to .5" of welcome rain but dry weather is forecast in the rest of the country the next 5 days or more, which will increase stress on the wheat crop. Warm and dry weather will be featured in northern Mato Grasso, Brazil's largest bean growing state, the next 5 days or more. Favorable weather is forecast in Parana, the 2nd largest bean state. Argentina will be dry the next 3 days but up to 1.5" of rain is forecast the first half of next week, which will be welcome in wheat, corn and bean areas.
The southwest US winter wheat belt will be mostly dry the next 7 days or more. The midwest saw up to .5" of rain in the west and up to 1" in the east overnight. The west will be mostly dry tomorrow through Thursday while the east will see up to 3/4" today followed by dry weather tomorrow through Thursday. This dry period will allow for harvest progress in corn and beans once fields dry out from the latest rain event.
The grains showed some independence from the financial markets yesterday but don't expect this to happen today.---Vic Lespinasse
