Several headwinds, including a stronger US Dollar and a bumper global crop have hit the grain sector over the past several months. Take Corn for example. Corn for December delivery fell almost $2.00/bushel from May to October, seeing prices hit a low of $3.20/bushel last week. And similar downdrafts hit Wheat and Soybeans as well.
In fact, Cargill, Inc. said that profits dropped 26% in the latest quarter as their grains trading business was hit by the steep drop in Corn, wheat, and soybean prices.
But the grain sector has finally begun to show signs of life. Corn rallied around 8 cents/bushel today and has rallied roughly 20 cents/bushel to around $3.40 since bottoming last week. Wheat prices have rallied around 8 percent off their August lows to settle near $5.06/bushel.
The chart below highlights the Futures price action in the grain sector over the past 4 months.
Key levels for the Grain Sector:
December Corn – $3.60/$3.65 resistance. Above this level and Corn may rally further.
December Wheat – $5.45/$5.50 resistance.
November Soybeans – $10.50/$10/60 resistance.
Note that these commodities are also trackable and tradable in ETF form via Teucrium Commodity Trust Corn (CORN), Teucrium Wheat Fund (WEAT), and Teucrium Soybeans Fund (SOYB). Thanks for reading.
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No position in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.