MarketsFarm – Prices on the Chicago Board of Trade continued to rally on July 19, and to Scott Capinegro of Barrington Commodity Brokers of Barrington, Ill., they appeared set to push higher.
Capinegro pointed to the hot and dry weather across much of the United States as the main reason for the gains being made in the Chicago soy complex as well as in corn, plus winter and spring wheat. He also said the excessive rain in Kansas has slowed the harvest of the state’s winter wheat.
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“We got record temperatures over in Europe, Canada is dry and China is dry,” he added, noting Russia’s withdrawal from the Black Sea Grain Initiative and its missile attacks on Ukraine’s main port of Odesa.
Reports said Russian missile strikes on July 18 and 19 have prevented grain exports of 60,000 tonnes out of Odesa.
“The technical charts are moving up. We had some farmers who had hedges on, so they turned around and pulled them off,” Capinegro continued, stating this helped to fuel the rally as well.
The broker said he can see the rally pushing well into the week of July 24 and perhaps further.
“If the weather stays like this it could. We put a lot of weather premium back into the market,” Capinegro said.
However, he lamented that the United States might lose its competitive edge with Brazil over corn, should its rally carry on. But he also pointed to a much weaker U.S. dollar which slipped below 100 points on the U.S. Dollar Index.
Capinegro wished there were more export sales to China, particularly with corn and soybeans. He did point to rumours that Canada was looking to pick up its imports of U.S. corn.
— Glen Hallick reports for MarketsFarm from Winnipeg.
