Grain > Commentary > 1/16/2020

1/16/2020

Jan 16, 2020

Today was not a good day in the grain markets.  Yesterday the Phase One deal with China was signed, but the markets continued to sell the reality.  Corn surprisingly took the brunt of the selling today as the funds continue to defend their short position.  The numbers of the China deal sound impressive but the fact China said they would buy based on needs and price suggest to some they may wait to buy most of the goods until later this summer and New Crop time slots.  Why would anyone think China wouldn't buy their cheapest option?  So now we watch the Ag export price matrix to see when the US becomes the most competitive.  Some feel they still may show up for some small good faith bean purchases in order to get the US to drop tariffs.  We will see if that happens or not, but for now the market feels nervous.  Corn broke through support this morning and never looked back as we now target the Dec 3.71 low.  Beans tested the 50% retracement level for the move, but finished a couple cents above it.  Hopefully that level holds or the 61% retracement level comes into play at 9.12 march futures.  The DOW continues into new highs, up over 150 points again today!
 


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