Dec 27, 2022

Grains followed crude oil's lead the first day back from Christmas break. A combination of crude oil futures opening significantly higher and China announcing they would be ending all covid restrictions Monday night spurred funds to add fresh length. Corn and soybeans both gapped higher at the 8:30 a.m. cold open. Corn finished the day firmly 4-8 cents higher and near its intraday highs. Soybeans traded 16-37 cents higher, setting new 6-month highs before fading back quickly after updated weather models put a fair amount of precipitation into the South American forecast. The USDA announced a sale of corn to Japan that included 7,500 tonnes for delivery in 2022/23 and 170,000 tonnes for delivery in 2023/24. Weekly export inspections came in at the top end of expectations with 856k tonnes of corn and 1.753 mln tonnes of soybeans inspected last week. Shipment pace for corn is short of the USDA target by 176 million bushels, improving from 186 million last week. Soybean shipment pace is short of the USDA target by 24 million bushels versus 33 million bushels last week.

A poor technical look for anyone bullish soybeans. After appearing to break out to the high side, setting new 6 month highs, soybeans reversed lower, and finished weak. Mostly closing below the opening marks on the day. Set up for a classic “bull trap.” China opening faster is supportive but around the mid-day point, trade questioned if that means $15 beans with an expected big Brazil soybean crop that began early harvest last week.

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