Grain markets got hit hard again today, and Bulls are excited to put the month of February in the rearview mirror. Make corn was 13 ¼ cents lower for the day settling at 630 ¼, which put them 51 cents lower for the month. The new crop December contract was down 6 ¼ cents today, settling at 569 ¾. Soybeans, which have been performing better than corn and wheat over the last few days, finally played catchup today after closing below trendline support yesterday. May beans were 33 ¾ cents lower on the day, settling at 1479. For the month, beans were down 51 ¼ cents. Chicago wheat was able to stabilize some and defend the psychologically significant $7.00 level. May wheat settled 4 ½ lower at 691 ½. May KC wheat was down 4 ¼ settling at 812 ¾.
Long liquidation was a big catalyst for the selloff in corn and beans over the last few sessions, while the opposite scenario is taking place in wheat. We haven’t gotten updated Commitments of Traders data for about a month, but it’s safe to assume that Managed Money are aggressively net short wheat, potentially holding one of their larger net short positions in years. This poses the risk of a short covering rally. In the month of March, we will start getting a lot of jawboning back and forth on how many acres and of what crop will be planted this year. The March 31st prospective planting report will put the line in the sand. Also, the deadline for the Black Sea grain deal is in the middle of march, we wouldn’t be surprised to see some headlines around that pop up in the coming weeks too.
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