Afternoon Comments 12.04.19
Corn (CH) 378-4 down 2 3/4 | Soybeans (SF) 878- up 7
The overall market was lead by fund positioning, primarily in soybeans, where the perception is that there may be a deal with China which is close at hand. Reversing the thoughts the trade had yesterday that a deal may not be done until after the 2020 election. Overall, the trade wants to see proof that the deal gets done before any real excitement can take place. With regards to recent price action, soybeans have found support off of the September lows, while showing signs of being oversold. So we may be heading for a bounce.
Over on the corn side, though the recent price action has been less than desireable, it has at least made the US corn more competitive on the world stage. US corn is currently competitive with South America, while only being undercut by Russia. It appears as though S. America is begining to run low on available corn for export while Russian corn is begining to be used domestically for their own feeding program due to it being locally competitive with wheat, and thus keeping it out of the export market. Hopefully, we will begin to see a pick up in corn export demand between now and when SA new crop corn hits the market this spring.