If you watch the grain markets trade on a given day, it seems like prices are going up or down. If you watch for a week or so right now, you realize the prices are mostly sideways.
Movement is in a trading range, and no progress is being made. The grain market, as defined by the Chicago Board of Trade, is not accomplishing much right now.
The last big fundamental news for the season has come and gone. The January Inventory Report gave us final crop size and no real reaction price-wise. The December 1 Quarterly Grain Stocks Report, out the same day, gave us a bounce that lasted a couple of days, leading to the current doldrums. News since then has not helped us much, and is not expected to help.
Corn demand is suspect as the ethanol woes continue. Ethanol plants have slowed usage, and are closing in some cases.
Poet announced that their ethanol plant in Macon, Mo., would close because they are having trouble originating corn out of that drought-stricken area.
On the other hand, we finally got a week with a good export report. Grain inspections were 21.127 million bushels, up from the anemic 11.597 of last week.
We have said that the exports pace was running only 52 percent of that needed to meet USDA projections. This week we got them, and are looking now at 20.8 million a week needed to make our goal.
Soybean markets have focused on South American weather, but there has been conflicting news there. The soybeans in North America are mostly grown within a few degrees of latitude.
A weather pattern moves west to east and covers the whole bean patch. The opposite is true in South America. There, we have currently areas of Argentina that have not had rain in a month, but areas of Brazil where the heavy rains are delaying harvest.
Markets were closed for MLK day Monday last week. That did not seem to cause any effect except maybe to help us to the top of the recent range in corn and beans.
Last Tuesday, we touched 7.34-3/4 on March corn, with a low of 7.26-1/4. The recent low was 7.14-1/2 Jan. 24. The big day of the period was on the 28th when we had a high of 7.29-1/2 and gained eight and a half cents.
In early trading Tuesday we are at 7.31. The March soybeans had the recent low back on the 11th at 13.51-1/2. Last Tuesday we were 14.60-3/4 — quite a jump! This morning we are at 14.19-3/4.
The March wheat has made gains recently, the only grain to really look like maybe there is a trend. The low was on the 11th at 7.36-1/4.
Last Tuesday after the holiday we touched 7.99-3/4, a gain off the bottom of 63-1/2 cents. We are now at 7.81, having held much of the gain.
Still the mood among traders is not bullish. Only farmers think we return to high prices. The traders think these are high prices. I continue to say that we have trading this year as a short crop. The high comes at harvest, then prices decline. Nothing has happened to change that pattern.