DJ US Cash Grain Review: General Price Retreat Led By Soybeans

[regoer]

Most U.S. cash grain markets weakened Thursday, led by a retreat in soybean prices.

  Soybeans were one of the weakest components of the basis trade, with a 2 to 8
cent-per-bushel downturn in export basis accompanying a barely steady interior
basis market.

  Although official accounts indicated that protesting farmers continued to
blockade ports and prevent soybean exports from Argentina, rumors of a pending
settlement to the strike swirled throughout the soybean market.

  "An end to the strike could easily break the soybean market $1, so be
prepared for even more volatility," warned eHedger.

  Soybean futures also dropped nearly 25 cents on the day, pressured by
expectations for a dramatic increase in producer plantings of that key oilseed,
as well.

  "The eastern corn belt is very wet as is the Delta/Southeast; this can delay
corn planting and mean even more acres of soybeans than currently expected,"
said North Dakota market analyst Ray Grabanski. "The (Monday) USDA planting
intentions report also will likely be bearish beans, as more people want to
switch away from corn due to high fertilizer costs and rotational
considerations."

  With such conventional wisdom getting broad play on the floor, cash contracts
of CBOT corn closed with 3 1/4-cent gains Thursday, although spot wheat futures
fell 14-24 cents at all U.S. exchanges.

  "Egypt's purchase of (6.6 million bushels of US SRW) wheat this morning did
not get the market running like one would expect," said Country Hedging's Jean
Wynn. "Most players don't want much to do with the market right now and one
can't blame them. It looks as though things will be quiet until the upcoming
crop report."

   CROP WEATHER


  The Joint Ag Weather Facility at USDA said locally heavy rain was
"maintaining soggy fields and perpetuating lowland flooding in the Ohio and
middle Mississippi valleys," Thursday, while snow fell in the Upper Midwest.

  "Elsewhere, warm weather is promoting winter wheat growth on the southern
Plains, except in areas with inadequate soil moisture to support proper
development," said agency meteorologist Brad Rippey.

  Warm, dry weather currently favors the growth of winter grains, as well as
summer crop planting/emergence across most of the Deep South.

  "Showers and thunderstorms will persist through today in the southern and
eastern corn belt, and spread into the northern Mid-Atlantic region," forecast
Rippey. "During the weekend and early next week, additional rain will develop
in already-saturated areas of the Mid-South and lower Midwest, while
thunderstorms may erupt from the southeastern Plains to the lower Mississippi
Valley."