CBOT grains had another double digit loss day. December corn closed 19 cents lower at $7.24 ¾, November soybeans 38 ½ cents lower at $15.73, and December wheat down 17 ¼ cents at $8.69 ¼.
Without much supportive fundamental information the markets continued their downward trend. Ethanol production was down 25,000 bbl on today’s EIA report and stocks were left unchanged. We did see a private 2012 soybean sale of 140,000 MTs to an "unknown destination". Egypt bought 300,000 MTs of wheat (from Romania and France). CIF basis was steady to firm for corn and beans but producer selling has slowed after the most recent price break.
September has been a particularly poor month for grains. December corn is down 75 cents or -9.38%. December wheat is down 20 ¼ cents (-2.28%) and November soybeans down $1.83 ½ (-10.45%). The August low for November beans is $15.55 ¼, a settlement below there on Friday would signal a monthly key reversal. Now that we have surpassed the first major retracement level of $15.81 without breaking a sweat, the next major target for November beans would be $15.17. This is the 50% retracement level and 100 day moving average.
November Soybean Chart
December corn has had a very orderly departure from the highs. There are three major technical targets between $6.76 and $6.84 – the 4th of July gap, the 100 day moving average, and the 50% retracement. We have the stocks report on Friday as well as end of the month, end of the quarter. It may seem like a long way off to see these levels but we just broke December corn by $1.24 ¼ from the highs to reach today’s settlement. Another 48 ¾ cents to fill the gap isn’t necessarily out of the question.
December Corn Chart
Average analyst estimates for Weekly Export Sales source: Reuter’s Poll
Corn: 150,000 – 250,000 MTs
Soybeans: 650,000 – 800,000 MTs
Wheat: 400,000 – 550,000 MTs
The Quarterly Stocks report is out this Friday. I have included the average estimates as well as the EHedger estimates in the chart below. For now we want to remain with sustainable hedges as we progress through harvest. To sign up for a free EHedger trial please click on the link below.
Wheat Production Estimates (Report Friday)
Quarterly Stocks Estimates (Report Friday)
Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. The market information contained in this message has been obtained from sources believed to be reliable, but is not guaranteed as to its accuracy or completeness. Market information may not be consistent with current or future market positions of EHedger LLC, its affiliates, officers, directors, employees or agents.