Markets Fizzle Again!

This was another one of those days when you think it could have been worse. Corn opened under a little pressure and actually recovered and traded 3-4 cents higher during the day. By the close corn was up a fraction. There was a lot of outside market action affecting the grain markets. The China stock market was quit a lot lower, tensions are building in the Middle East, and North Korea detonated what they claimed was a hydrogen bomb. Experts are not sure it was a more powerful hydrogen bomb, but any way you look at it did not help the grain markets. The Energy Information Administration reported that ethanol production last week increased 4,000 barrels per day to 996,000 barrels per day. Ethanol stocks were up, however, by 900,000 barrels.

Beans saw an active day, too. Beans traded 3-4 cents lower, recovered to get up almost 10 cents a bushel only to close up just 3-4 cents. Informa Economics released its bean production estimate for Brazil this afternoon. Informa left their estimate unchanged at 101.4 MMT. Apparently Informa does not think there has been any production losses in northern Brazil because it was too dry or southern Brazil because it was too wet. I guess our only hope of higher corn and bean prices is the funds covering their short positions. They are record short for this time of year. We need a spark to get them to cover. However, it has happened that all at once some day we gap higher for no other reason then the funds started to cover their shorts. The key is to have a plan in place with targets so you can react quickly.