Price action: Corn futures saw a choppy day of trade, but firmed into the close on spillover from soybeans to end mostly 2 1/2 to 5 1/4 cents higher. Slightly lesser gains were posted in far-deferred contracts.
Fundamental analysis: Corn futures were supported by light short-covering into the close. However, lackluster export and domestic demand continues to limit buying interest in the corn market. Corn is seeing limited spillover from the recent sharp rally in the bean pit, which suggests either soybeans are overvalued or there's little interest in buying corn due to demand destruction. But if soybean futures continue to rally, it should help lift corn futures.
Also limiting buying in the corn pit is more favorable weather. With much of the eastern Corn Belt now out of the drought watch and another winter storm headed to the country's midsection, traders suspect the weather pattern may be changing.
Technical analysis: March corn futures posted an inside day of trade on the daily chart to remain within the week-long consolidation range. The high-range close gives bulls the upper hand heading into the overnight session. Important support lies at the December low of $6.78 with key resistance at the February high of $7.46 1/4.
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 closed 10 3/4 to 14 cents higher today, which was in the upper end of today's range, but off session highs.
Fundamental analysis: Soybean futures built on Tuesday's strong gains on support from the possibility the export window for U.S. soybeans could remain open longer than anticipated. Labor unrest in Brazil and the likelihood Argentine farmers will be slow sellers of new-crop soybeans suggest foreign end-users (primarily China) could continue to come to the U.S. for soybeans near-term.
Additional support is coming from Argentine weather. While more precip is in the near-term outlook, rain events have repeatedly been disappointing the past two months.
Technical analysis: Tough resistance for March soybean futures stands at the December high of $15.01 1/4. How futures react around that level will determine if this week's strong price rebound is short-lived or if it turns into a more extended price recovery.
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 were choppy through the morning, but firmed this afternoon and finished mostly 4 to 6 cents higher in Chicago, mostly 5 to 8 cents higher in Kansas City and mostly 1 to 5 cents higher in Minneapolis.
Fundamental analysis: Wheat futures were supported by light short-covering amid ideas the downside has been overdone. Some fresh export news also contributed to the corrective gains. Egypt bought 60,000 MT of U.S. SRW wheat in an overnight tender and export sources signal China has purchased around 350,000 MT of U.S. wheat over the past 10 days. These are the first signs U.S. wheat prices may have dropped "far enough."
Limiting buying interest, however, are forecasts calling for heavy precip across areas of the Central and Southern Plains. While the HRW crop remains in rough shape, there's hope the recent wetter pattern will help the crop and that it could be a sign of a potential change in the weather pattern.
Technical analysis: March Chicago wheat futures remain in the strong downtrend from the November swing highs. The contract needs consecutive higher closes above this trendline, which intersects at $7.43 1/4 Thursday, before there is talk of a short-term low.
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 trimmed gains into the close to finish 6 to 47 points higher.
Fundamental analysis: Cotton futures continue to be supported by expectations China will return as a buyer of U.S. cotton now that its Lunar New Year celebration is over. However, Friday morning's weekly export sales report should reflect a slowed sales pace last week. Additionally, expectations that U.S. cotton acreage will be dramatically lower than last year is supportive for new-crop futures. Strength in the U.S. dollar index caused traders to trim gains into the close.
Technical analysis: March cotton futures briefly penetrated resistance at yesterday's high of 82.95 cents before settling near session lows. A close above the January high of 84.00 cents would open fresh upside potential, while support lies at last week's low of 80.05 cents.
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.