Price action: Corn futures were stronger throughout the day and saw a late-session surge resulting in a high-range close. Futures ended with gains of 9 1/4 to 17 cents. Funds were active buyers of corn today, purchasing 12,000 contracts (60 million bushels).
Fundamental analysis: Traders added some weather premium back into prices after heavy rains moved across much of the central Corn Belt over the Memorial Day weekend. More rains are in the forecast this week, which means remaining unplanted corn acres will either be switched to another crop, claimed as prevent-plant or have a lower yield potential due to the risks associated with late planting.
Technical analysis: December corn futures gapped higher in overnight trade and extended gains during daytime trade and closed above the psychological $5.50 level. Followthrough buying tomorrow would have bulls targeting the April high of $5.70. Closes above that level would strongly suggest a low has been posted and make the next upside objective the February high of $5.96 1/2. Support lies at the bottom of today's gap at $5.36 3/4 and extends to the May low of $5.12.
Hedgers: 100% sold on 2012-crop in the cash market. 10% of expected 2013-crop production is sold via cash forward contract for harvest delivery
Cash-only marketers: 75% sold on 2012-crop production. 10% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Price action: Soybean futures finished mostly 30-plus to 40 1/4 cents higher, with the November contract leading gains. Funds were major buyers, purchasing an estimated 13,000 contracts (65 million bu.) of soybeans today.
Fundamental analysis: The weekend's widespread soaking of the Corn Belt coupled with forecasts for more heavy rains propelled futures higher out of the gate. The soakings mean soybean plantings, already late, will be delayed even further. As these delays continue, there is concern yield potential for the late-planted soybeans will decline. Traders shrugged off concerns that the planting delays could also mean a shift of intended corn acres to soybeans, at least for now.
On the export front, traders shrugged off the rise in the U.S. dollar and drew confidence from an announced sale of 120,000 MT of soybeans to China for 2013-14 delivery this morning and reports that nation was rebuilding its poultry industry after the bird flu incident.
Technical analysis: Bulls needed a close above $12.80 in November futures to signal a potential trend change and they got it. The contract finished the day at $12.88, at the day's high. The pivotal $12.80 area now becomes support. The next upside price target is Feb. 22 spike high at $13.07 with the February high of $13.50 3/4 the more significant area of resistance.
For July soybeans, today's trading found support at Friday's low at $14.71 1/2 and spent most of the today's trade above Friday's high at $15.05 3/4. Resistance sits at last Thursday's spike high at $15.46 3/4.
Hedgers: 100% sold on 2012-crop in the cash market. 50% of expected 2013-crop production is hedged in November soybean futures at $12.19. 10% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 90% sold on 2012-crop. 10% of expected 2013-crop production is sold via forward contract for harvest delivery.
Price action: Wheat futures traded in a narrow, choppy trading range today and ended likewise. Nearby contracts at all three locations favored the downside while deferred months favored the upside amid bull spread unwinding.
Fundamental analysis: Wheat traders paid more attention to a strengthening U.S. dollar index than strong gains in the corn market today. Recent strength in the greenback raises concerns about the competitiveness of U.S. wheat, though today's strong export inspections tally signals there is as yet no cause for alarm.
The forecast for heavy rain in some regions of the HRW Wheat Belt this week also limited buying interest in Chicago and Kansas City as drought has been increasing in the region. Conversely, rain in the forecast for the Northern Plains doesn't bode well for getting the spring wheat crop planted, which limited pressure on Minneapolis wheat today.
Technical analysis: July Chicago wheat futures continue to struggle to close above tough resistance at $7.00. The contract traded through this level today, but was unable to sustain buying at those prices and ended mid-range and around 6 cents shy of $7.00. To the downside, support is layered from the May low of $6.74 to the April low of $6.64 3/4.
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: Several cotton contracts gapped higher on the open but intraday action closed these gaps. July through December contracts ended low-range with July down 6 points and the other months posting slight gains. Further deferred contracts ended high-range with gains of 57 to 146 points amid bull spread unwinding.
Fundamental analysis: Bullish enthusiasm in the grain and soy markets to start the week spilled over to the cotton market today. Somewhat tempering buying interest was strong gains in the U.S. dollar index, which makes U.S. cotton less attractive to exporters. The market is taking a cautious approach as it gauges whether prices have dropped far enough to encourage some bargain buying.
Anticipation of this afternoon's crop progress update from USDA also limited selling interest, as cotton planting in recent weeks has lagged behind the average pace of seedings.
Technical analysis: December cotton futures stopped short of resistance at 85.00 cents today but the market bounced off a test of the 84.00-cent level, marking these psychologically significant levels as near-term resistance and support, respectively. A move through the lower end of this range would have bears eyeing Friday's low of 83.02 cents.
Hedgers: 50% of expected 2013-crop production is hedged in December cotton futures at 83.87 cents. 50% of expected 2013-crop production is also sold via cash forward contract for harvest delivery. 100% sold on old-crop in the cash market.
Cash-only marketers: 85% sold on old-crop. 50% of expected 2013-crop production is sold via cash forward contract for harvest delivery.