Market News

Corn, wheat fail to sustain soybean’s support: July 28, 2009

Buying emerged Tuesday, leading to sharply higher soybean futures. That was despite pressure coming from outside markets. The dollar was higher, the Dow was lower and crude oil was lower. DTN says Tuesday’s action could indicate that commercial traders are becoming nervous about new-crop supplies because of the late developing crop and talk that China plans to purchase a couple of cargoes and that their reserves may not be as big as advertised.

Corn futures were unable to sustain buying enthusiasm late into the session after recovering from a lower open. For part of the day, corn enjoyed support from sharply higher soybean prices. Pressure instead came from the higher dollar. Losses were limited by the slowly maturing corn crop and cool Midwest weather. However, DTN says new-crop spreads continue to indicate bearish underlying fundamentals in the corn market.

Wheat followed soybeans higher for a majority of the session, but only Minneapolis was able to hold minimal gains by the close. Support is coming from lagging crop maturity and concern over protein levels as well as winter wheat’s bearish underlying negative fundamentals in the market. The higher dollar also exerted downward pressure. DTN says that from a technical standpoint, futures still have downside potential.