Price action: Corn futures settled 8 1/4 to 10 cents higher through the July contract. Farther deferred futures finished mostly 5 to 7 cents lower.
5-day outlook: USDA's report data and today's price action suggests a short-term low is in place for old-crop futures. But it will take a push above today's highs to confirm a low and attract active speculative buying to the long side of the market. Failure to see followthrough buying early next week could trigger additional price pressure even though USDA's numbers signal higher prices are needed to slow use.
30-day outlook: While old-crop corn futures firmed today, new-crop contracts couldn't sustain buying interest. That's a sign expectations for big corn plantings this year could limit the upside into spring. Planting expectations will be adjusted as private estimates are released ahead of USDA's Prospective Plantings Report at the end of March.
90-day outlook: With virtually all of the western Corn Belt's moisture tank on "empty" and soil moisture supplies just marginally better east of the Mississippi River, growing conditions will be watched very closely from the time seed starts going into the ground. If the moisture situation doesn't improve dramatically by spring, timely rains will be needed throughout the growing season to build a decent national average yield.
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: As expected, price action was highly volatile after USDA released its key January report data. January beans ended firmer, while March through July futures settled weaker, but near session highs. Far deferred futures posted double-digit losses and ended near session lows. Most contracts posted slight gains for the week.
5-day outlook: January reports are known for setting trends into the spring. With futures hovering above November lows, followthrough pressure early next week would open additional near-term pressure as it would suggest traders' focus is clearly on expectations for a record Brazilian bean crop.
30-day outlook: Meanwhile, a flurry of daily export sales activities signals soybean prices have found value. But traders have assumed a "prove-it" attitude, especially since new-crop Brazilian beans will soon be more readily available by the end of this period.
90-day outlook: USDA raised 2012-13 carryover by 5 million bu. in today's S&D Report, but 135 million bu. of supplies are still tight. With China expected to import a record amount of soybeans this year, there is still a need for soybeans to hold onto as many acres as they can this spring, especially if soil moisture remains dry in the western Corn Belt.
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 faced light pressure early in today's session, but the market rallied after the release of the USDA's reports at 11 a.m. CT. The market settled well off its highs, with Kansas City leading to the upside. Chicago wheat finished mostly 4 to 10 cents higher, Kansas City wheat 10 to 11 cents higher and Minneapolis wheat 5 to 7 cents higher. Today's gains helped wheat futures to end with slight weekly gains.
5-day outlook: Today's report data should limit selling interest and may even spark some short-covering next week. USDA lowered its 2012-13 carryover and Dec. 1 grain stocks estimates more than expected today and it also pegged all winter wheat seedings below the average pre-report trade guess. To confirm a short-term low, futures must take out today's highs and find followthrough buying.
30-day outlook: For the wheat market to repair major technical chart damage, support will need to come from the demand side. Over the past few weeks, there have been brief glimmers of hope U.S. wheat is being more actively sought on the global market, but a steady stream of export news will be needed to convince bulls to throw money at the long side of the market.
90-day outlook: As spring nears, the drought that was most recently estimated to cover nearly 72% of the contiguous U.S., including the vast majority of the Plains winter wheat country will begin to get more attention. Significant rain is needed to improve conditions for an HRW crop that entered dormancy with record-low condition ratings.
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 traded in a wide range today on both sides of unchanged and settled mixed with the March through July contracts 29 to 42 points higher and farther deferred months 1 to 11 points lower. Cotton ended with slight gains for the week.
5-day outlook: While domestic cotton production and carryover figures came in on the friendly side of the average pre-report trade guesses this morning, USDA's global cotton carryover peg of 81.72 MMT is up 2.08 MMT from last month and 12.87 MMT above year-ago. This kept cotton within its long-standing trading range today and likely points to choppy action again next week.
30-day outlook: The market will continue to monitor whether China releases state cotton reserves and/or increases import quotas. A release of Chinese state reserves would pressure the market, while an increase in import quotas would be supportive. Until one of these come about, cotton will likely continue to trend sideways over the near-term.
90-day outlook: The general consensus is that cotton will lose acres to corn and especially soybeans this growing season. The question is, how much? Whether cotton is able to bid some acres away from these more economically attractive crops will shape an eventual answer. Cotton will have to rally into spring to maintain as many acres as possible. Failure to do so would also be longer-term price-supportive, as this would lower crop prospects.
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.