Price action: Corn futures saw two-sided trade today and ended high-range with gains of 1/4 to 4 cents for the day.
Fundamental analysis: Corn futures initially benefited from building concerns about heat and dryness in Argentina as tight U.S. supplies mean the South American crop takes on added importance. But the market saw some profit-taking around mid-morning after the release of weekly ethanol production data from the Energy Information Administration showed production of 784,000 barrels per day the week ended Jan. 11, its lowest level since the agency began releasing weekly data in June 2010. Plus, export demand remains lackluster.
But spillover from soybeans helped bulls regain control of the corn market into the close. Reports of freeze damage to northern Mexico's corn crop also provided light support.
Technical analysis: March corn futures extended the contract's recent string of higher closes today, continuing the uptrend toward the November high of $7.67 1/2. Support remains at the psychological $7.00 level.
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 enjoyed gains throughout today's session and ended high-range with March through September futures 20 to 23 cents higher and far-deferred months posting lighter, double-digit gains. Soymeal and soyoil futures also posted solid gains.
Fundamental analysis: Some private crop watchers have lowered their Argentine bean production estimates due to overly wet conditions early in the growing season followed by the current hot and dry weather pattern. This encouraged traders to build more premium into bean prices today. A small U.S. crop and an impressive soy demand story this year mean that a large South American crop is crucial. While benign growing conditions in Brazil mean a record crop is still expected, tight domestic supplies mean any South American weather scares can still stir up market bulls.
Adding to the bullish tone, Gulf basis firmed 5 cents for February delivery at midday which could signal fresh demand news lies ahead.
Technical analysis: March soybean futures came within 4 cents of near-term resistance at the Dec. 26 high of $14.43 today. A move through that levels would have bulls targeting the December high of $15.01 1/4. Friday's low of $13.51 1/2 is strong support.
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 came under pressure at times today, but most contracts ended in the upper half of today's trading range. Chicago wheat settled roughly 2 to 3 cents higher, while Kansas City and Minneapolis wheat saw gains of roughly 3 to 5 cents.
Fundamental analysis: Wheat futures continue to benefit from concerns about drought across the Southern and Central Plains and recent cold temps in the Central Plains. And the latest news out of the Black Sea region is that up to a quarter of the Russian wheat crop may have been exposed to winterkill. But this was somewhat tempered by news India now plans to export 10 MMT of state wheat reserves, which compares to earlier plans to export 4.5 MMT.
But for the wheat rally to continue, this supply news must be coupled with demand news. Traders will watch tomorrow's export sales report for signs of improved export demand.
Technical analysis: March Chicago wheat futures continue to make their way toward resistance at the psychological $8.00 level, followed by the Dec. 19 high of $8.22 3/4. Strong support lies at last week's pre-report low of $7.36 1/4.
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 enjoyed an upside day of trade and ended 12 to 92 points higher for the day with nearby contracts leading gains.
Fundamental analysis: Cotton futures continue to benefit from lackluster demand among millers at Chinese cotton reserve auctions. Talk has circulated that the government stocks are of low quality and that this may translate to higher imports from the United States. The market also continues to talk about rumors that millers will be allowed 1 MMT of cotton imports for every 3 MMT of reserve cotton they buy, though this has not yet been confirmed.
Improved export demand would put even more importance on the upcoming battle for acres. Cotton is expected to actively lose acres to corn and beans in 2013.
Technical analysis: March cotton futures broke through and settled above support at the December high of 77.10 cents today, turning it into near-term support. This opens upside potential to the August high of 78.02 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.