Price action: July corn futures closed 3 1/2 cents higher. Deferred contracts closed mostly 1 1/2 to 2 3/4 cents lower, posting low-range closes.
Fundamental analysis: Traders continue to view recent weather patterns as mostly positive for crop development with drier weather in the forecast for the soggy western Corn Belt and moisture predicted for the dry southern Illinois. USDA's crop conditions report on Monday contributed to that view, listing 65% of the crop in "good" to "excellent" condition, a one-percentage-point uptick from the week-earlier figure. Traders are turning their attention to the Acreage Report due Friday from USDA. Most are expecting a downturn in planted acreage due to the late planting triggered by continuing rains. USDA's June 1 corn stocks figure will also be released that day.
Technical analysis: July futures found support just above Monday's low at $6.50 and resistance at yesterday's high around $6.61. The late-April to current uptrend line offers support at $6.47. The contract has solid resistance starting at $6.70.
The December contract expanded on yesterday's trading range, finding support just above $5.40 and resistance in Monday's downside gap at $5.51. Futures probed the gap area and then slumped through the remainder of the trading day. Prices need to surge to $5.53 3/4 to fill that gap. On a longer view, the contract remains trapped in a wide sideways trend with resistance near the $5.70 to $5.75 area and support under $5.25.
Hedgers: 100% sold on 2012-crop in the cash market. 25% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 90% sold on 2012-crop. 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Advice: Hedgers were advised this morning to exit the 50% 2013-crop hedge in Nov. soybean futures.
Price action: July soybean futures finished 13 1/4 cents higher, while the August and September contracts were 8 and 6 3/4 cents higher, respectively. New-crop contracts ended fractionally to 5 cents higher, with November futures up a nickel.
Fundamental analysis: July soybean futures were supported by tight supplies and a firming cash market. The tight supply situation is being heightened by new-crop concerns.
New-crop futures were supported by strength in the lead-month contract, crop concerns and spreading with corn. As of Sunday, 8% of the soybean crop had not yet been seeded and 19% must still emerge. The primary concern areas are Iowa and Minnesota.
As USDA's key reports at the end of the week draw closer, attention will turn to preparations for that data.
Technical analysis: Monday's low at $12.55 is key support for November soybean futures. A drop through that level would make $12.40 1/4 next support. To signal a short-term low is in place, bulls are looking for a close above the psychological $13.00 mark.
Hedgers: NEW ADVICE: The 50% hedge in Nov. soybean futures was exited at $12.75 3/4 for a 56 3/4 cent loss. 100% sold on 2012-crop in the cash market. 20% forward priced on expected 2013-crop production for harvest delivery.
Cash-only marketers: 90% sold on 2012-crop. 20% forward priced on expected 2013-crop production for harvest delivery.
Price action: Wheat futures closed mostly 2 to 3 cents lower in Chicago and Minneapolis, and fractionally to 11 cents lower in Kansas City. That was low-range for the day.
Fundamental analysis: Wheat futures traded firmer through mid-morning, but were unable to hold onto the corrective gains as corn favored the downside and the U.S. dollar index reversed higher after trading lower overnight. With harvest progressing in the Plains and yields improving as combines roll north, wheat faces a near-term uphill struggle. Even in short crop years, harvest-related hedge pressure still weighs on futures.
Canadian wheat acreage came in slightly lower than anticipated, which helped limit selling pressure in Minneapolis wheat. Traders are also concerned with the delayed plantings and emergence in North Dakota.
Technical analysis: Key near-term support for July Chicago wheat futures lies at the June 17 low of $6.74 1/2 and the May low at $6.74. A drop below that support would open downside risk to the April low at $6.64 3/4, which is key support.
Hedgers: 100% sold on 2012-crop in the cash market. No 2013-crop sales advised yet.
Cash-only marketers: 100% sold on 2012-crop. No 2013-crop sales advised yet.
Price action: Cotton futures closed 161 to 211 points higher through the December contract. Farther deferred futures were mostly 81 to 94 cents higher. Futures ended high-range.
Fundamental analysis: Cotton futures bounced back from Monday's losses amid short-covering. Some of the Chinese liquidity concerns that pressured the market to start the week have eased for now as the People's Bank of China says it will provide cash, if needed.
Traders are also showing some concern with the cotton crop, especially in Texas. USDA rates 37% of the crop as "poor" to "very poor" in the top production state, with only 25% of the crop rated "good" to "excellent."
Technical analysis: December cotton futures remain well within the bounds of the recent, choppy pattern. The June 3 low of 81.72 cents is key support, while the June 14 high at 89.56 cents is tough resistance.
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. 100% sold on old-crop in the cash market.
Cash-only marketers: 85% sold on old-crop. 50% of expected 2013-crop production is sold via cash forward contract for harvest delivery.