Market Comments
By Jim Stephens,
President of Farmers National Commodities, Inc.
Market Update for January
6, 2009
Futures
prices continued to move higher through the holidays with the rally
continuing into January. Soybeans
have found some support from weather concerns in South America. Both corn and
soybeans have had some support from recovery in crude oil futures and
increased buying interest from Index Fund pools. Some of this bullish
sentiment has moved over to the wheat market as well. Market volatility will
remain a concern with price corrections expected to be as sharp as this price
recovery if market attitudes shift again.
We have
started to see some competition for acres with December 2009 corn and
November 2009 soybean futures showing good gains the past two weeks. We
expect this bidding war for acres to continue, but at what level is unknown.
Soybeans are currently getting support from concerns with South American
production. If rain showers in the forecast the end of this week develop and
cover a wider area, we could see soybeans slip back a little lower with corn
slipping back as well.
USDA will
release a supply/demand report on January 12. There could be some adjustments
in production as well as demand. Most feel ending carryout in soybeans will
remain close to current levels, while ending carryout for corn could creep a
little higher based on lower feed and ethanol usage. Only minor adjustments
are expected in wheat numbers.
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