Price action: Corn futures closed mixed with July through March futures down 1/2 to 1 1/2 cents and later contracts fractionally to 1 3/4 cents higher. Futures finished high-range for the day. Funds were even today.
Fundamental analysis: Corn futures opened lower on a continuation of the profit-taking noted Friday. A stronger dollar and rains over the weekend in the driest areas of Brazil with forecasts for more contributed to the decline. However, futures found buying interest as followthrough selling dried up and export news proved positive. Today's weekly export inspections report came in at 791,947 MT, which was down 51,393 MT from last week but within pre-report expectations. Corn futures also received spillover strength from the stronger wheat futures market.
Technical analysis: March corn futures slumped through support at $4.50 in early trading but quickly found support at $4.45. Futures closed near their daily highs and back above the important $4.50 area, which again sets it up as an important support zone. Layers of resistance rest every nickel higher, however.
Hedgers: 60% sold in the cash market on 2013-crop. 20% of expected 2014-crop production is sold via cash forward contract sale for harvest delivery.
Cash-only marketers: 50% sold in the cash market on 2013-crop. 20% of expected 2014-crop production is sold via cash forward contract sale for harvest delivery.
Price action: Old-crop soybean futures closed 11 3/4 to 15 3/4 higher, while new-crop contracts ended around 6 cents higher.
Fundamental analysis: Brazilian crop concerns fueled price strength in the soybean market today. Heavy rains through northern production areas of central Brazil over the weekend halted harvest efforts in many areas, slowed transportation of beans to ports and shut off some soybean loadings at ports. Plus, there are concerns the heavy late-season rains will hamper crop quality and yields. This overshadowed beneficial rain through southern Brazil and forecasts calling for more rains this week. Brazil is still going to grow a record crop this year, but production estimates are on the decline.
Also, traders attitudes toward Chinese cancellations have shifted. With China continuing to actively take shipment of U.S. soybeans and given the growing concerns about logistical problems in Brazil, there are reduced concerns about China actively canceling purchases of U.S. soybeans.
Technical analysis: March soybean futures closed above the September high of $13.77 3/4 and came within a dime of the contract high of $13.99 3/4. The technical picture will remain bullish until there are signs of topping action, although the contract has moved into overbought territory according to the Relative Strength Index.
Hedgers: 100% sold in the cash market on 2013-crop production. 10% of expected 2014-crop production is sold via cash forward contract sale for harvest delivery.
Cash-only marketers: 90% priced on old-crop. 10% of expected 2014-crop production is sold via cash forward contract sale for harvest delivery.
Price action: Wheat futures faced pressure overnight and early this morning, but the market firmed ahead of midday and futures ended just off session highs with solid gains. SRW ended around 11 cents higher in most contracts, while HRW and HRS wheat posted gains around 6 to 9 cents in most contracts. Funds bought 6,000 contracts (30 million bu.) today.
Fundamental analysis: The wheat market faced pressure overnight and early this morning as traders looked to take advantage of recent gains. There were also some concerns that prices may have risen enough to slow export demand. But after this morning's weekly export inspections report indicated this is not yet the case (inspections came in near the upper end of expectations and above week-ago levels), traders began to cover short positions and push the wheat market higher.
There are also some concerns about a return of cold weather to the Plains with much of the winter wheat crop again void of snowcover. In addition, neither the short- nor the long-term forecast are favorable for drought relief in the Southern Plains.
Technical analysis: March SRW wheat futures posted a bullish reversal today, as the contract gapped lower on the open, but then firmed and settled just off session highs with gains for the days. This gives bulls a clear advantage heading into the overnight session. Resistance is tightly layered from last week's high of $6.20 3/4 to $6.25.
Hedgers: 100% sold on 2013-crop in the cash market. 35% of expected 2014-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 75% sold on old-crop. 35% of expected 2014-crop production is sold via cash forward contract for harvest delivery.
Price action: Cotton futures enjoyed an upside day of trade and ended around the midpoint of today's wide trading range. Futures settled 11 to 95 points higher, with nearbys leading to the upside.
Fundamental analysis: Strong gains in the soybean market provided spillover support to the cotton market today. The front-month also benefited from some technical-based buying as the contract traded all the way up to the psychologically significant 89.00-cent level, which triggered profit-taking. The May contract penetrated key resistance at 90.00 cents today, but the contract was unable to sustain buying above that level and settled below it.
Fundamentally speaking, China continues to purchase cotton supplies for its state reserves, despite plans to end its stockpiling program this year. This adds to uncertainty regarding Chinese export demand going forward.
Technical analysis: March cotton futures matched but failed to move through resistance at 89.00 cents today. A successful challenge of this level would set bulls' next target at the 2014 high of 89.31 cents followed by 90.00 cents. Last week's low of 86.24 cents remains near-term support.
Hedgers: 75% of 2013-crop is sold in the cash market. 25% of expected 2014-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 75% of 2013-crop is sold. 25% of expected 2014-crop production is forward sold for harvest delivery.