Grains are lower in overnight trading:
Corn – 2 ½ cents/bu (May @ 3.79 ¼ )
Soybeans – 7 cents/bu (May @ 8.91)
Chi Wheat – 4 cents/bu (May @ 5.14 ¾ )
Cdn $ +0.00020 (74.51 cents)
WTI Crude Oil -2.40/barrel (43.50)
Grains traded both sides of unchanged overnight, but are currently sitting near their lows for the session. Outside markets are generally negative this morning, with energies, metals, and softs predominately weaker. USA equities are lower, with Dow futures down another 730 points @ 25,330.
Weakness is again being blamed on uncertainty and fears over the spread of the Coronavirus around the globe. As infections start to spread in bigger numbers over a wider geography, the markets are focusing more on the spread of the disease than they are on the apparent improvements seen regarding the disease within China. Global confirmed infections are currently listed at 100,271 cases, with 3,408 confirmed fatalities. Of note, overnight, China reported 150 new COVID-19 infections, while Iran reported 1,234 new cases. Last night, the International Air Transport Association ratcheted their estimates of airline losses due to the Coronavirus higher, raising their estimate of $30 billion losses (made 2 weeks ago), up to a whopping 113 billion dollars in losses. Such a number would be right in line with what airlines lost back in 2008 during the global financial crisis.
From a grain perspective, the lack of any Chinese buying of USA soybeans and corn this week has allowed the futures market to sell off, as was expected to be the case in the absence of any Chinese purchases as the week concluded. Market bulls will continue to hope to see such buying, but yesterday’s and this morning’s losses have put the soybean market back down just below last Friday’s close, and technically, the bean trading charts look ugly. Grains will struggle until such a time as we see either aggressive Chinese buying, or some positive news with respect to the Coronavirus. Unfortunately, neither of those scenarios are present this morning.