Alaron Grains and Oilseeds Comment

CHICAGO - Mar 14/08 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Thursday's weekly export sales report showed 768 t.m.t. of corn was sold last week up 19% from the week prior, equal a year go.   This is 8% under our four week average.    Pre-report trade guesses were for 600 t.m.t. to 1 m.m.t.   We need over 1 m.m.t. to remain bullish but lower sales are traditional ahead of USDA crop reports such as we had this week.   Asian sales were 300 t.m.t. vs.. 440 the week prior.   It is a neutral demand indicator in a year of demand running ahead of USDA projections.   Ignore it, stay bullish.   December corn made new contract highs this week for the fourth consecutive week.   Like last week, we finished on a weak note.   With the March 11th USDA crop report behind us, we have a grey area before the big March 31st planted acreage report.   We are sure to have our fair share of down days as outside market influence has its way but equally as many up days will occur.   Expect a run up into the March 31st report on fear it will no show enough acres to be planted.   We had s support today on December corn at 5.64 and hit that price by mission.   A close under 5.64 makes 5.40 next support and worse case scenario ahead of the march 31st report.   May support lies at 5.44 today then 5.10.   Breaks in the grains today were deeper on fear the Bear Stearn Co. problems might lead to long fund grain positions.

Thursday's weekly export sales reports showed 257 t.m.t. of beans were sold last week, up 27% from a weak number the week prior, under a year ago of 451.   This is under our four week average by 41%.   Key player china, was in for 71 tm.t.   Here how to read this report:   The weekly number is consistant with more beans being bought out of Brazil which is seasoned now and expected, buy traditionally in years past we would see cancellations of previous U.S. purchases by China.   In lieu of cheaper south American beans and that is not happening.   In fact, China's buying with both hands, one from our ports and the other at Brazil's ports.   This in the big picture is bullish as demand outstrips supplies world wide and look for the U.S. to return as world's primary port of origin for beans late April when South American sales from their harvest wind down.   Stay bullish demand.   We are following bean oil and palm oil exclusively now.   The March 121st crop report brought a 90 cent rally off Monday's low and I expect a sharp run up into the March 31st planted acreage report as fear is if we do not show at least a 5 m.a. increase we may run out of beans in 2009.   Now from wheat level will they run.   New crop November beans had first support today at 12.75 then 12.40.   buy a little at each price.   May support is 13.40.   Depending on outside new news, a low on Monday could hold for the week.  

Thursday's weekly export sales report showed 210 t.m.t. of wheat was sold last week off 51% from the week prior and 9% under our four week average.   Before ending stocks dropped to 60 year lows we needed 700 t.m.t. or more to be bullish.   Now anything sold is too much.   I see it at friendly for demand.   Though demand is the primary driving force as supplies dry up, we are in for a change late month.   first, the March 31st planted acreage report will give us an idea of how many spring wheat acres will be planted but our winter wheat crop breaks dormancy any time now as temperature warm up in the western plains.   When dormancy breaks, we turn to weather reports on the hour to determine wheat's price movement and we look to the weather site wrist.com as they have been accurate in recent years on rain and temp forecasts.   We will break dormancy at 44% of the crop in good to excellent condition as stated on our last USDA crop condition report when wheat went dormant last fall.   This is a weak or poor rating and challenging wheat to find better than perfect weather to improve quality and yields and that maybe tough.   Nationally 52% of the nation has experienced serious dry conditions to severe drought through March 6th.   This week into next looks to bring the first good rains to the southern delta and 70% of the western plains.   Only big winter wheat producer Texas seems to be missing this rain and leaving most of their crop in poor to very poor condition.   Long term we have to remain bullish July new crop Kansas City Exchange winter wheat   crop futures as any weather problems through April 1st to May 20th our key yield development time and sharp supply side concern rallies will be certain.   If Mother Nature cooperates and condition ratings soar, exporters and millers will move in to buy wheat's most historically needed crop to fill empty warehouses.   Deliver a demand rally between May 1st and harvest beginning late May through June.   Support on July K.C. wheat lies at 11.50 then 11.10.

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

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