The Grains Review For the Week of March 5, 2012

[pitgurufk]

On Friday markets saw a very messy trade. Early weakness in corn and wheat was erased as both followed beans to the upside. On the close, wheat popped to daily highs as positive floor momentum and strength in KC and Minny helped support the trade. This feels more like short covering (backed up by losses in OI) than anything on the fundamental side so I do not look for momentum to continue in Chicago where as KC and Minny have some reasons to continue higher as demand and weather remain issues. KC remains an unknown with the HRW crop sure to experience problems if below average precipitation and above normal temps persist through March. The SRW crop should have far fewer problems if the drought monitor is believed. Minny is again bullish due to commercial receipt ownership and talk of acreage losses to Canola and other small grains in northern regions. The acreage war in northern states should be a hell of a show this year with vegetable oil crops moving in on historical wheat land. Talk of corn seed delivery problems from DeKalb in the Dakotas adds to the issues in that region heading into the planting season. Corn saw a tighter trade in CN-Z and a move to an inverse in CH-K. The latter speaks bullish for corn but crude and a weak Euro kept the market in check. Flat price remains stuck in the established range looking for a catalyst that traders probably won