Price action: Corn futures extended overnight gains during the day session and futures rallied into the close to end near session highs with gains of 19 to 22 cents through the September 2014 contract.
Fundamental analysis: Weather concerns are in focus to start the week after rains failed to materialize over the weekend and as reports from Day 1 of the Pro Farmer Midwest Crop Tour hit the market. (See "Evening Report" for more). Heat is moving into the Midwest and is expected to remain in effect over the 6- to 10-day outlook, adding to existing concerns about Midwest dryness and its impact on yields. There are precip chances for the upper Midwest late this week and into next week, however.
Traders were also unwilling to be caught short ahead of USDA's Crop Progress and Condition Report this afternoon. It is expected to a show a slight decline in the "good" to "excellent" rating.
The market also saw some technical buying interest as nearby contracts moved back above the 20-day moving average for the first time since June. Funds bought an estimated 18,000 corn contracts (90 million bu.) today.
Technical analysis: December corn futures posted strong gains for the day and ended just a few cents shy of support-turned-resistance at $4.90, after which resistance stands at the psychological $5.00 mark. Support stands at the August low of $4.45 3/4.
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: 100% sold on old-crop. 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Price action: Soybean futures firmed as the day progressed and futures rallied into the close. September through January futures settled 38 3/4 to 44 cents higher; March was up 28 1/4 cents and deferred months ended 12 to 17 1/2 cents higher. Funds bought an estimated 15,000 soybean contracts (75 million bu.) today.
Fundamental analysis: High temps are forecast for the next two weeks with varied precip. This lifted the bean market today as the crop is entering its key yield determining phase. Check "Evening Report" for an update on the findings from Day 1 of the Pro Farmer Midwest Crop Tour. USDA will also provide an update on the condition and development of the bean crop at 3:00 p.m. CT today. Expectations for a slight decline in the amount of the crop rated "good" to "excellent" added support today as did weekly export inspections that came in above expectations and the week prior's tally.
The price rally in futures did encourage some farmer selling, which caused basis levels at interior locations to soften.
Technical analysis: November soybeans gapped slightly higher on the open and rose steadily throughout the day. Futures traded through and closed above resistance at the July highs and the psychologically significant $13.00 mark, setting the stage for a test of the June high at $13.33. Support now stands at $13.00.
Hedgers: 50% of expected 2013-crop production is sold via a forward-price cash contract for harvest delivery. 100% sold on 2012-crop in the cash market.
Cash-only marketers: 50% of expected 2013-crop production is sold via a forward-price cash contract for harvest delivery. 100% sold on 2012-crop in the cash market.
Price action: Wheat futures enjoyed light buying interest throughout the day and ended around 8 to 10 cents higher for SRW wheat, while HRS wheat finished 4 to 8 cents higher. HRW wheat closed with gains around 3 to 5 cents for the day.
Fundamental analysis: Early support for the wheat market stemmed from strong gains in the soybean and corn markets. Otherwise, buying interest is limited as demand concerns remain in effect. While weekly export inspections surged to 33.787 million bu. the week ended Aug. 15, topping expectations by a wide margin, traders remain concerned about the competitiveness of U.S. wheat prices. A rebound in production in regions like the Black Sea means that other locations are keeping prices below those of the U.S. Reminding the market of this was news Ukraine's ag ministry raised its grain export forecast for 2013-14 by 2 MMT to 30 MMT.
Ongoing spring wheat harvest is another limiting factor.
Technical analysis: December SRW wheat edged out slight gains for the week, but the downward posture of the market remains intact. Initial resistance stands at the August double-top of $6.79 3/4. Support is at last week's contract low of $6.35 1/2.
Hedgers: 50% of 2013-crop is sold in the cash market. 100% sold on of 2012-crop.
Cash-only marketers: 25% of 2013-crop is sold. 100% sold on 2012-crop.
Price action: Cotton futures settled low-range with losses of 5 to 64 points today.
Fundamental analysis: Traders booked some light profits after last week's impressive rally that took nearby contracts to their highest level since February 2012. Money managers expanded their net long position by 23% the week ended Aug. 14 to a record-large 74,810 contracts.
But selling interest was limited to profit-taking as traders readied for USDA's crop progress and condition update. Recent crop condition reports have pointed to deterioration in what is already expected to be a small crop.
Technical analysis: December cotton futures spent the day trading in the upper half of Friday's trading range, leaving resistance at Friday's high of 93.72 cents and support at the June high of 89.56 cents.
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 2012-crop in the cash market.
Cash-only marketers: 50% of expected 2013-crop production is sold via cash forward contract for harvest delivery. 100% sold on 2012-crop.