Price action: Corn futures saw a choppy day of trade and futures ultimately ended split with old-crop contracts 3/4 to 3 3/4 cents lower and new-crop futures fractionally to 1 3/4 cents higher.
Fundamental analysis: Corn futures faced early pressure as beneficial rains fell in South America yesterday and more is in the forecast for Argentina tonight. But the release of the Energy Information Administration's weekly ethanol production data reminded the market that domestic ethanol demand is improving -- albeit slowly -- and that U.S. carryover supplies are very tight. Strong basis levels around the U.S. are also reminders of this.
However, traders will likely be reminded of lackluster export demand in tomorrow's Weekly Export Sales Report from USDA.
Technical analysis: March corn futures remain within their downtrend since the start of the month, but no major chart damage has been done. Strong near-term support remains at the January low of $6.78, while the February high of $7.46 1/4 is near-term resistance.
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: Nearby soybean futures gained upward momentum ahead of midday. The March through September contracts closed 1 1/2 to 4 cents higher, while new-crop futures closed mostly 3 cents lower. Meal was weaker amid spreading with soyoil, which was higher.
Fundamental analysis: Ideas the downside has been overdone and that nearby futures were due for short-covering lifted those contracts. But traders are hesitant to rebuild long positions given lackluster demand due to this week's Chinese holiday and expectations foreign buyers will soon favor South American supplies as its crop becomes more readily available.
But traders didn't want to get caught short in case tomorrow morning's weekly export sales report reflects another big weekly sales tally, as has been the trend.
Technical analysis: March soybean futures posted a daily low of $14.04 1/2 before bouncing and closing back above the $14.20 level. Violation of the psychological $14.00 level would make bears' next target the January low of $13.51 1/2, while bulls need prices to return above last week's high of $14.98 to gain traction.
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 mostly 3 to 4 cents higher in Chicago, mostly 1 to 2 cents higher in Kansas City and mostly 6 to 8 cents higher in Minneapolis. Futures ended high-range at all three exchanges.
Fundamental analysis: Wheat futures were pressured through the overnight and early morning hours by followthrough selling and recent precip in the Plains. But selling dried up around mid-morning and short-covering mildly supported futures amid ideas the downside has been overdone.
To spark a sustained price recovery, however, traders must see an improvement in export demand. That could be tough as India is more actively looking to export wheat as it cleans out government grain stocks.
Weather may also deter sustained buying interest. In addition to recent rains, the 6- to 10-day and 11- to 15-day forecasts call for better rain chances through the Central and Southern Plains. Still, the HRW crop is in dire need precip after a very poor start.
Technical analysis: Despite today's gains, March Chicago wheat futures are still oversold according to the 9-day Relative Strength Index, signaling more corrective gains are needed. To signal an extended correction is underway, the contract must post consecutive higher closes above the downtrend from the November swing highs, which intersects around $7.52 1/2 Thursday. Tests of this trendline have attracted fresh selling interest.
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 closed 71 to 99 points lower today, which was mid-range for most contracts.
Fundamental analysis: Cotton futures followed up Tuesday's decline with additional losses today. While there are some concerns over the impact recent price strength will have on export demand, it appears the losses the past two sessions are corrective in nature. Whether this turns into more than a corrective pullback will largely depend on weekly export sales tomorrow morning. If there are signs of demand destruction, additional price pressure is likely.
Additional pressure is coming from certified cotton stocks, which have risen to the highest level since May 2011. The sharp rise in prices is attracting more cotton supplies that are certified to be delivered against IntercontinentalExchange cotton futures contracts.
Technical analysis: March cotton futures stopped 5 points shy of the psychological 80.00-cent mark, which is also the bottom of the of short-term consolidation range. A close below that level would make old resistance at the August high of 78.02 cents key support. A close below that level would signal a short-term top is in place.
Hedgers: 50% priced on expected 2012-crop production in the cash market.
Cash-only marketers: 50% priced on expected 2012-crop production in the cash market.