Grains Ride The Wave
China woke up after its New Year’s celebration and the market rallied from the negativity that we have seen. Even with harvest ahead of schedule in South America the Grains found a way to rally. In the overnight electronic session the March Corn is currently trading at 361, which is 2 ¼ cents higher. The trading range has been 363 ½ to 359 ¾ so far. Weather, news and the South American harvest will dominate the price rang we will see until Planting Intentions.
On the Ethanol front there were no trades posted in the overnight electronic session. The March contract settled at 1.376 and is showing no activity with bids or offers at the moment.
On the Crude Oil front the market is abuzz with the Saudi, Russian and Qatar comments about a production freeze. The market would prefer to have production cuts in this oversupplied market. And the initial euphoria has distanced itself from the highs in the market. In the overnight electronic session the March Crude Oil is currently trading at 2949, which is 5 tics higher. The trading range has been 3153 to 2895 so far. Tomorrow we will have the delayed API data due to the Presidents Day holiday. Unless there is a big build the effect of the numbers will take a backseat to the news of OPEC and Non-OPEC nation’s cooperation.
On the Natural Gas front the market is selling off on warmer weather forecasted in the next couple of weeks. The March contract is currently trading at 1.906, which is 6 cents lower. The trading range has been 1.963 to 1.904 so far. The market is very close to our aggressive buy zone of 1.895. Although this number is aggressive, it is cheap versus cost of production.