Now What?
Steve Bruce of Walsh Trading - - Fri Feb 08, 11:03AM CST

The reports are history and now it's time to focus on weather and Washington! Sort of anti-climatic!

When millers want to buy wheat this time of year in an environment where there is a shortage of quantity and/or quality they typically goose the basis and try to get covered through June. Calling up larger elevators and asking what they have and what it will take to let it go might happen and then if and when some smaller player needs to cover needs or export sale and tries to cover it becomes apparent that few bushels are left and basis, spreads and board may become unmerciful! Feeding the mill might get expensive! How we break dormancy in the next few weeks will be important and the anxiety over the weather might keep us volatile.

There's talk in the country that input costs for corn are getting extreme and the acreage might not be there this Spring if we stay at current levels. Traders have been hoping for more corn/fewer bean acres yet, bankers might keep producers from fulfilling this dream. Corn spreads are still languishing and the traditional last push of movement before the Spring thaw might keep spreads on the defensive.

The soy complex is still concerned with South American weather and hedge activity. The harvest has been enjoying a record pace to date. Spreads have been trudging along and, like corn, producers might make one last push off of the farm before we focus on Spring field work and plantings.

The information contained on this site is the opinion of the writer and obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.

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Steve Bruce

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