Price action: Corn futures were firmer throughout the day on short-covering and spillover from soybeans, but settled off session highs with gains mostly around 4 cents. Funds bought an estimated 7,000 contracts (35 million bu.) of corn today.
Fundamental outlook: Corn posted gains on Monday, saw profit-taking yesterday and today rose to keep this week's back-and-forth trend in place. Upside potential is being limited by ideas the bulk of harvest-related hedge pressure is not yet behind the market, while pressure is being limited by ideas prices are spurring fresh demand.
Traders will get fresh demand news via the weekly export sales report tomorrow morning. Additional support came on news that ethanol production last week was the highest of the year (see "Evening Report" for more).
Technical outlook: December corn posted a weekly high of $4.46 1/4, which is initial resistance, before moving off the session high into the close. Support lies at the October low of $4.32. Futures need closes back above $4.50 to signal a low is in the works.
Hedgers: 25% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Price action: Soybean futures traded higher throughout the day but the gains were trimmed in late trading, leading to a mid-range close. Futures finished 2 1/4 cents to 7 3/4 higher in bull spreading.
Fundamental outlook: Soybean futures surged on news of overnight export business and expectations of more export business to come. The market then rose on news Russia bought 120,000 MT of soybeans for 2013-14 delivery. Gulf basis levels firmed 1 to 3 cents for immediate to December/January delivery, which contributed to ideas that more export business will be announced soon.
Also, with harvest progressing well past the halfway point, traders expect a reduction in hedge-related pressure.
Technical outlook: November soybean futures moved higher and probed resistance at the $13.18 area and the 50-day moving average. Initial support is at the October high of $13.05 3/4. The late-September double-top high around $13.28 marks important resistance, closely followed by the June high of $13.33.
Hedgers: Get to 100% sold in the cash market on expected 2013-crop production. We'll manage risk on the board the remainder of the marketing year.
Cash-only marketers: Get to 75% sold on expected 2013-crop production.
Price action: Wheat futures enjoyed gains throughout the day session, but the market pared gains heading into the close and finished around a penny higher in the SRW market while HRW ended 1 to 5 1/4 cents higher. HRS wheat finished mixed with nearby contracts around 2 cents higher.
Fundamental outlook: Wheat futures initially benefited from spillover from the corn and soybean market as well as ongoing concerns about production overseas, including in Argentina, the Black Sea region and Australia.
But a favorable start to the winter wheat growing season in the U.S. as well as news Lanworth raised its global wheat forecast today led to some late profit-taking. There is also some unease about what tomorrow's export sales update from USDA for the week ended Oct. 3 will reveal. Expectations are for sales to come in between 600,000 MT and 850,000 MT.
Technical outlook: December Chicago wheat futures finished low-range but above near-term support at the psychological $7.00 mark. Yesterday's high of $7.11 1/4 is initial resistance, but a tougher challenge stands at the June high of $7.38 1/4.
Hedgers: 75% sold on 2013-crop in the cash market. No 2014-crop sales are advised.
Cash-only marketers: 50% sold on 2013-crop. No 2014-crop sales are advised at this time.
Price action: Cotton futures faced heavy pressure today and the market ended 84 to 176 points lower for the day with nearby contracts leading to the downside.
Fundamental outlook: Cotton faced followthrough selling after yesterday's poor finish, which triggered sell stops. The December contract pushed through multiple levels of key support, including the bottom of the long-term consolidated trading range, though chart damage was less severe for other months.
While the latest update from USDA showed cotton harvest continues to lag the average pace, the near-term outlook is favorable for progress. Meanwhile, the lack of fresh export demand news remains a weight on the market. Traders will get an update on sales for the week ended Oct. 3 tomorrow. But traders are less than optimistic for a bullish number as recent reports have disappointed.
Technical outlook: December cotton futures took out tough support at the September low and then long-standing support at the June low. These levels are now resistance. Followthrough pressure tomorrow would point the market towards the psychological 80.00-cent mark.
Hedgers: 50% of expected 2013-crop production is hedged in December cotton futures at 83.87 cents. 50% of expected 2013-crop production is also sold via cash forward contract for harvest delivery.