Grains are mixed in overnight trading:

Mar Corn – 1 ¼ cent/bu (6.13 ½ )

Jan Soybeans + 1 ¾ cents/bu (13.64 ¼ )

Mar Chi Wheat – 10 ½ cents/bu (7.93 ½ )

Cdn $ +0.00070 (78.205 cents)

WTI Crude Oil +0.99/barrel (76.56)

Grains have traded both sides of unchanged in the evening session.  The market continues to be supported by concerns over widespread dryness in Argentina and in southern Brazil.  Most analysts have slashed their forecasts for South American production, with cuts of 2 million tonnes of Brazilian soybeans and 1 million tonnes of Brazilian corn quite common this week.  Similarly, cuts of a million tonnes of both corn and beans in Argentina are also being projected.  Overall South American production numbers remain huge, but the with current models trending to lower production, weather premiums will continue to support grain prices.

While weather forecasts support row crop prices, wheat is being adversely impacted by sluggish demand at the moment.  Global supplies of milling quality wheat remain tight, but we do need to see buyers come forward before we can see the wheat market rally significantly.

This morning’s weather maps are showing an increased possibility for rain in southern Brazil next week, which is a big reason why we have come off of the early overnight strength that we saw.  The market will be looking for verification of these rains in upcoming weather map model runs.  Argentina remains mostly dry in their forecasts.