Market Report: Corn and Beans Higher Wednesday

It was a good day for corn Wednesday, posting gains of 5-9 cents a bushel. There was probably some follow-through buying from the USDA Report Tuesday. I suspect many traders were surprised at how much the USDA cut Brazil's corn production. Remember the USDA dropped Brazil's corn production by about 10 percent, or 7 MMT. Normally the USDA is more cautious about cutting crop production. Traders also seemed to be concerned about weather next week. Both weather models agree it will be hot next week.

Beans had a good day too Wednesday, with gains of 13-20 cents a bushel. Beans moved through the 10- and 20-day moving average, plus beans got over the psychological $11 a bushel. With the hot and dry extended forecast we seem to be putting some weather premium back into the market. The USDA is projection a new crop carryover of 290 million bushels. That is starting to look a little tight. In addition the USDA is assuming very high bean yields this year. If you take just a couple bushel off the national yield we will have to "price ration" beans.