Markets Firmer Tuesday

Even though corn only closed 1-2 cents higher Tuesday, technically it was a very good day. Recently corn had been trying to get a rally going, and Tuesday March corn pushed through the 20-day moving average and held. Hopefully this signal can bring some short covering. The funds are quite short and if we can get nudge maybe we could have a nice rally. Corn was supported by strength in beans and the EPA renewable fuels mandate. With the mandate pushed to 14.5 billion gallons of ethanol usage in 2016, this would increase corn demand by about 150 billion bushels.

Beans had a good day, too, posting gains of 7-8 cents. The technical picture is improving for beans, too. Last week beans saw a reversal and Tuesday beans closed above the 50-day moving average, which has not happened for a while. Beans were supported by the news that Argentina will slowly reduce their export tax, which will not dump a lot of beans on the world market. Beans were also supported by strong oil prices. The EPA increased the mandate for biodiesel and of course most of the biodiesel comes from bean oil.