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January 18 Grains Commentary: Larry Shover

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Hi, this is Larry Shover reporting to you from the CME Group in Chicago with Thursday's grain report. Mostly a sea of green except for corn. Corn fractionally lower this morning after a huge spike march yesterday matching levels we haven't seen since probably the very beginning of January. It seems any rally that we see in corn is met by hedging. People going out to the '18-'19 market year to hedge their crop. That said, yesterday there was some notable buying from speculators and funds. Demand remains sturdy, especially when we look at ethanol and what the reports are on that with consensus. But on top of that, it seems like corn continues to be trapped in this broad and volatile trading range between 340 and 370. And the excuse tends to be record inventory. Moving on to soybeans, soybeans just unbelievable. Still trying to put our heads around the rally we saw way back last Friday of 18 cents. After stumbling out of the gate today, soybeans rallied once again. Markets continue to digest news thinking that with all the reduced acreage around the world, but increased acreage here that perhaps we will be trapped in that 9.50 to $10 range. We will see, but beyond that, with favorable Latin American weather, increased acreage, that's really putting an overhang on soybeans. One thing to note is managed money did increase their shorts just slightly on the week. Lastly, to wheat. Wheat continues to be strong, strongest in Minneapolis but also in Chicago, up one to three cents. The market continues to grapple with the decrease of acreage in the US versus the increase of acreage around the globe, what that means. Yesterday we saw strong ruble again. That's impacting the wheat pricing Egypt paid up for wheat, prices we haven't seen in a long while. And consensus continues to look at Canadian dollar, Australian dollar, euro, ruble, and the price of oil, something that's going to be highly correlated to the wheat price going forward. I'm Larry Shover reporting to you the grain report from the CME Group in Chicago.

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Duration: 2 minutes and 41 seconds
Country: Andorra
Language: English
License: Dotsub - Standard License
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Posted by: cmegroup on Jan 18, 2018

January 18 Grains Commentary: Larry Shover

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