Looking at the market today we see a downside bias with all macro factors pointing to a flushout of weak length. There is no incentive to own commodities this week with weakness seen on fundamental, technical and macro fronts.
Tomorrow’s WASDE report is looking for an increase in S. American production numbers with Brazilian beans looking over 67 MMT with Argentinian corn looking over 20 MMT. Both will add downside pressure on the market. Only small changes are expected to US consumption numbers with Soy and Corn exports always on the move. Old crop carryout is in question following reports that hte remaining 4% of the corn crop left in the field will be tilled under to help expediate new crop plantings.
Outside of this we need to look at increasing reports of BioFuel mandates and increasing Ethanol mandates as we move through 2010. This is a major factor for Ann Frick, lead analyst for Bache. She is calling for July oilshare to reach 51%…WOW. Currently trading at 45%.
MPI
