Price action: Corn futures faced pressure throughout the day and ended mid-range, with December through May futures down 6 to 7 1/4 cents, while deferrred months saw lighter losses.
Fundamental analysis: Traders focused on reducing their risk exposure ahead of USDA's Supply & Demand Report slated for tomorrow morning. Traders look for USDA to raise its 2012-13 corn carryover from 647 million bu. to 666 million bu., which is still well below last year's 988 million bushels. Adding to the risk-averse tone, Gulf basis levels softened for winter delivery this morning and the weekly export inspections tally was again disappointing.
Technical analysis: March corn futures remain within the lower portion of the contract's multi-month choppy trading range. Support is layered from the November low of $7.14 1/4 to the September low of $7.08 3/4. Resistance extends from the November high of $7.67 1/2 to the October high of $7.75 3/4.
Hedgers: 100% sold on 2012-crop in the cash market -- 10% for March 2013 delivery. No 2013-crop sales recommended yet.
Cash-only marketers: 75% sold on 2012-crop --10% for March 2013 delivery; 15% for May 2013 delivery. No 2013-crop sales recommended yet.
Price action: Soybean futures favored a weaker tone until around midday, when short-covered lifted the market. Futures closed near session highs with gains 2 1/2 to 10 3/4 cents.
Fundamental analysis: Early pressure was tied to improved weather in southern Brazil, as more rain is in the forecast for the area this week. Economic uncertainty surrounding fiscal cliff negotiations also triggered a "risk-off" day in the markets. But as the session progressed, focus returned to strong demand and expectations USDA will trim its carryover projection in tomorrow morning's Supply and Demand Report.
This morning's weekly export inspections report also reminded the market of the strong export pace. While the weekly tally was within expectations at 46.632 million bu., cumulative inspections are running 41.1% ahead of year-ago and USDA currently projects exports 1.2% below year-ago.
Technical analysis: January soybean futures posted a high-range close to give bulls momentum heading into the overnight session. Resistance stands at last week's high of $14.98 1/4, with support at today's low of $14.53.
Hedgers: 100% sold on 2012-crop in the cash market. No futures/options positions at this time. No 2013-crop sales advised yet.
Cash-only marketers: 75% sold on 2012-crop production for harvest delivery. No 2013-crop sales advised yet.
Price action: Wheat futures closed with losses of 6 1/4 to 12 1/4 cents through the September contract in Chicago. Kansas City futures ended mostly 2 3/4 to 6 1/2 cents. Minneapolis wheat closed mostly 2 to 8 1/2 cents lower.
Fundamental analysis: Wheat futures were pressured throughout the day as traders were unwilling to add new long positions ahead of USDA's Supply & Demand Report Tuesday morning. The report is expected to show an increase in wheat ending stocks amid sluggish demand, specifically export demand, which continues to lag the "required" pace.
There was some fresh demand news as Saudi Arabia purchased 295,000 MT of wheat over the weekend, including some U.S. supplies. Also, USDA announced a daily sale of 115,000 MT of U.S. wheat to Egypt. But the Egyptian business was already "known" and there are ongoing concerns with the competitiveness of U.S. wheat on the global market. That allowed traders to overlook the demand news today.
Technical analysis: March Chicago wheat futures are holding just above initial support at the November low of $8.45. Violation of that level would make the bottom of the downtrending channel from the August high, which intersects at $8.38 3/4 Tuesday, next support. Below that, flat support is at $8.23 1/2.
Hedgers: 75% sold on 2012-crop in the cash market. No 2013-crop sales advised yet.
Cash-only marketers: 75% of 2012-crop is sold. No 2013-crop sales advised yet.
Price action: Cotton futures settled 1 to 45 points lower in a quiet, pre-report day of trade. Futures ended near session lows.
Fundamental analysis: Traders put the finishing touches on their positions ahead of USDA's Crop Production and Supply & Demand Reports tomorrow morning. Traders are expecting the crop size to inch up slightly from last month while carryover is expected to decline. That signals traders are expecting a boost in demand, likely projected exports, following the recent pickup in export sales activity.
Aside from USDA's report data, traders continue to keep a close watch on the macro-economic front. While economic conditions in China are improving, exports remain a question mark as many of China's top customers continue to struggle economically. Until the Chinese export picture improves, there will be a cloud of uncertainty hanging over the cotton market, especially with China already sitting on nearly half of the world's cotton stocks.
Technical analysis: March cotton futures remain in the modest uptrend from the November low, but must push above the October high at 76.39 cents and the August high at 78.02 cents to signal an upside breakout from the extended, sideways pattern.
Hedgers: 50% priced on expected 2012-crop production via cash forward contract for harvest delivery. A breakout from that range is needed to spark a trending move.
Cash-only marketers: 50% priced on expected 2012-crop production via forward contract for harvest delivery.