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Today’s Prices
Grain markets traded on both sides of unchanged today with mixed news stories providing both higher and lower trades.
Grain Market News
30-Year Fixed Rate Mortgage
A year ago, mortgage rates were below 3% and today a new high at 6.02.
Interest rates have over doubled in the last year.
DOW Jones
Inflation currently combined with the potential for a recession also has the equity markets overall trending lower off the highs posted around the 1st of the year.
The DOW Jones is down over 6500 points from those early year highs.
U.S. Dollar Index
The U.S. dollar index continues to move higher making a new high today at 111.36, this makes U.S. exports much less competitive on the global market.
Another way to put it, it makes U.S. goods more expensive for global buyers.
The combination of higher interest rates, lower stock markets, and a high U.S. dollar is certainly putting the U.S. economy with plenty of challenges.
Crude Oil
The crude oil market is going down which is good news for inflation standpoint but not good news when it comes to biofuels, corn, and soybean oil.
As the energy markets fall, producers can pay less for the raw material which would be soybean and corn.
Even though we have tight stocks, and our crop yield may get a little smaller, there is plenty of headwind when it comes to overall demand with interest rates rising, equity falling, energy falling, and the U.S. dollar streaming to the upside.
Grain Market News
Weekly Ethanol Production
Ethanol production down sharply at 901 thousand barrels per day, that was very disappointing.
It’s not unusual to see ethanol production dip just before harvest especially in years of tight stock.
Nonetheless ethanol production at 910 is somewhat disappointing for the corn trade today.
Weekly Stocks of Fuel Ethanol
Ethanol stocks declined for the third consecutive week down to 22.5 million barrels.
That’s good news but its still well above where we were a year ago at this time.
Overall, the weekly ethanol production report provided some mixed influences for the corn market.
High Temperatures
U.S. weather is not going to have a big factor on yields going forward but the U.S. weather will determine how quickly corn and soybean crops are harvested.
High temperatures yesterday in the 100s in the plains and 90s through most of the belt, that will allow crops to be drying down very quickly as we move towards our harvest season.
7-Day Precipitation Forecast
The forecast shows some precipitation on the Nebraska/Kansas border, a little bit in the northwestern belt but overall, not a lot of precipitation in this forecast.
This is less than normal precipitation.
Temperature Outlook
As we look ahead the 6-10 day forecast shows heat to the west, some cooler weather in the eastern belt and great lakes, and then warm weather setting back in the 8-14 day.
Overall precipitation following the scattered showers this week looks very dry in the 6-10 day and continues in the 8-14 day.
Overall, that should provide a very rapid harvest with above normal temperatures and below normal precipitation.
December Corn Chart
Corn prices continue to be in an uptrend on the December chart off the July lows at 5.61.
Prices are again for the second time in 2 weeks challenging the $7 level which is overhead resistance.
If we did break through this overhead resistance many chart traders would be eyeing up the 7.50 level for the next potential objective to the upside.
At this point we have not broken through that overhead resistance.
That leaves overhead at $7, chart support at about 6.65.
November Soybean Chart
Soybean prices are still in an uptrend off the lows posted at 12.88 back in July.
Today we did not hit the $15 mark and we closed somewhat poorly.
That leaves overhead resistance around the $15 level and chart support down around 14.35-14.40.
December KC Wheat Chart
The wheat market continues to look impressive; we have broken through all the major moving averages, and they have all turned upward over the last few weeks.
December wheat did post a new high today at 9.82, it still leaves $10 as our initial upside objective.
Questions or Comments
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