MarketsFarm — As prices rise on the Chicago Board of Trade (CBOT), the opportunity for profit-taking becomes more prevalent.
That said, values are very likely to continue increasing overall going into the week of April 26, according to analyst Terry Reilly of Futures International in Chicago.
“By the end of this week, I do expect some profit-taking to come into the market,” he said. “Being up three days in a row is pretty impressive, especially with the movements we’ve had.”
One of the big drivers in the gains seen at CBOT has been soyoil, he added.
“The soyoil basis, especially in the western United States, has been going to 1,000 and even to 2,500 over the May contract. It’s getting very hard to find soyoil, so tight supplies are driving the market higher,” he said, noting the commodity could become somewhat volatile.
However, solid support should be derived from unfavourable weather for the Brazilian corn crop as well as cold weather in Europe hurting rapeseed conditions, Reilly noted.
“I think we’ll see general support at least heading into next week,” he said.
The analyst forecast July Chicago soybeans to reach $14.90-$15 per bushel, July corn moving to $6.10-$6.15, and July Chicago wheat rising to $7 (all figures US$).
“In general, when you get soybeans up around the $15 area and corn around $6.15, you’re going to see some producer selling,” he said.
— Glen Hallick reports for MarketsFarm from Winnipeg.