On Monday, the CME Group’s soybean market rallied to close higher, despite bearish news out of Argentina.
At the close, the March corn futures settled 3 1/4 cents higher at $3.73. January soybean futures finished 6 3/4 cents higher at $8.64 1/4.
March wheat futures closed 7 3/4 cents higher at $4.97 3/4.
Jan. soymeal futures settled $2.90 per short ton higher at $285.90. Jan. soyoil futures closed $0.01 higher at $28.19.
In the outside markets, the Brent Crude oil market is $0.26 higher per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 53 points lower.
Sal Gilbertie, Teucrium Trading, says that light, pre-holiday trading makes for exaggerated moves. “Wheat is definitely the leader, probably due to last week’s surprisingly strong export sales report, which seems to reflect US wheat is finally starting to become more competitive globally on flat price.”
The lack of a reaction to the Argentine election in the bean markets could be a signal that the bear market is running out of steam, he says.
“This could be holding sellers at bay. Traders have not forgotten that we are right in the middle of the harvest seasonal low for corn, and with risk/reward metrics that do not favor bears because flat prices at or near the cost of production, it feels like sellers are taking the day off today.”
Matt Pierce, Futures International floor trader, says that value-buying is supporting the market. “I think people are looking at this as a value buy. Some short- covering which is why beans bolted higher. Inability for market to hold early contract lows promoted a technical reversal sentiment,” Pierce says.
He adds, “A small pop in front-end basis prices, across the curve, shows GULF business is growing against the flat price decline.”
The news of a new president in Argentina, though important, will take at least 90 days to really impact the trade, Pierce says.
