2/10/2022

Follow-through buying ensued almost immediately to begin the overnight session after the prior day's strong close.  Corn trade experienced what could be a very short breakout, stretching out another 10-15 cents to set fresh highs on the 2022 contracts before closing lower on the day.  The political chess match between the Ukraine, Russia, and the US saw its next move with Russia supposedly moving naval vessels in to block ports in Ukraine.  Ukraine is a US's competitor for Chinese corn business.  Soybeans had more than one log thrown on the bull fire today starting with CONAB (Brazil's USDA) showing a large decline in Brazil's soybean production estimate; from 140.5 million tonnes down to 125.5.  The market reacted immediately with beans rallying about 20 cents between 6-6:15 am.  The USDA announced a nice sized soybean sale this morning of 299,700 tonnes (about 11 million bushels) for delivery to unknown, with more than 75% of the total delivered in the 2021/22 marketing year.  We traded near 40 higher on soybeans before reversing lower and worked nearly a 70-cent range today.  Weekly net export sales for corn totaled 589k tonnes, within trade estimates but on the low end.  Soybean sales outperformed expectations with 1.596 mln tonnes sold.  Something I find extremely peculiar about this soybean rally is that we have not seen a single limit move higher.  Like computer trading is running the same algorithm programs day after day with a series of 30 higher moves.  Market corrections are inevitable and right now most commodities, with the exception of wheat, are extremely overbought.

While today’s reversals look bearish, we still have some room below before we test gap support in both corn.  March corn gap at 623’2.
A close above 1600’0 would have likely made that price a support level.  Finishing well off today’s lows is supportive but soybeans are still extremely overbought on the board.