Wednesday, February 25, 2009

Grains -- Building a Base... or Not?

I had begun to believe that grains were building a solid base for a bottom, since prices have moved modestly higher overnight, but the renewed selling pressure on stock index futures today has also put pressure on grain prices at the opening bell. It will be interesting to see if we can maintain a bottom and rise again from here. The March '09 corn contract is trying to hold support at around $3.40 -$3.50/bushel, and has been successful thus far over the past several days. Price levels lower than that may affect farm production negatively. (I am trading the May '09 contract, since it has four times the open interest.)