Price action: Corn futures enjoyed slight gains for most of the day and the market finished 1 to 2 1/2 cents higher, which was a mid- to high-range close for most contracts.
Fundamental analysis: Corn futures enjoyed light short-covering for much of the day, as well as some early spreading activity with the soybean market. Adding to the positive tone, weekly corn export inspections came in stronger than anticipated, which provided more evidence that corn export demand is rebuilding.
This helped corn futures extend their gradual uptrend since mid-month. However, the market must move above the November high to indicate a harvest low is in place.
Domestically, firm basis trade away from river terminals continues to signal corn-for-ethanol demand is strong.
Technical analysis: December corn futures continue to creep toward resistance at the November high of $4.38, after which resistance is tightly layered from $4.47 3/4 to $4.49 3/4. Support remains at the 2013 low of $4.10 3/4.
Hedgers: 25% of 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Price action: Soybean futures faced pressure until midday, at which point futures reversed course. January through August futures closed 1 to 9 3/4 cents higher, with nearbys leading gains. Farther deferred months finished roughly 3 to 5 cents lower.
Fundamental analysis: Dollar strength encouraged early profit-taking in the soybean market as traders took advantage of recent gains. But this eventually gave way to bargain buying as traders finally began to take note of impressive soybean demand. This morning USDA announced a daily sale to unknown destinations for 2014-15 and the market learned that China has begun stockpiling soybeans to lift domestic price. This could lead to even stronger soybean import demand from the country.
This morning's export inspections tally represents strong soybean demand, though the disputed tally fell short of expectations. USDA reported soybean export inspections of 66.934 million bu., but there appears to be some discrepancy between this week's tally and the even stronger gain in the commutative tally (see "Evening Report" for more).
Technical analysis: January soybean futures surged to their highest level since their mid-September selloff today. Tough resistance is layered from the June high of $13.37 to the top of the wide upside gap in August at $13.44 3/4. Support stands at $13.00.
Hedgers: Get to 100% sold in the cash market on 2013-crop production. We'll manage risk on the board the remainder of the marketing year.
Cash-only marketers: Get to 75% sold on 2013-crop production.
Price action: Wheat futures spent most of the day in positive territory, but the market did back off its highs at the close. SRW wheat ended 2 1/4 to 3 cents higher while HRW wheat saw slightly lighter gains. HRS wheat finished 1/4 to 1 1/2 cents lower with the exception of the front-month, which was 1 1/2 cents higher.
Fundamental analysis: The wheat market continues to consolidate in a narrow range as traders weigh wintery weather in the Southern Plains against export competition. USDA is expected to lower the amount of wheat rated "good" to "excellent" by one percentage point this week due to recent chilly weather and more downgrades may be ahead as freezing rain and snow are expected for some regions today.
Meanwhile, this morning's export inspections report reminded of tepid demand for U.S. supplies, though news Iranian private buyers are looking into buying around 300,000 MT of milling wheat is a source of underlying support. Private interests are hopeful the easing of banking system sanctions will soon permit Iran to make purchases.
Technical analysis: Uptrending support drawn off the lows since mid-month intersects around $6.50 tomorrow. Bulls' next target is the August high of $6.76 1/2.
Hedgers: 75% sold on 2013-crop in the cash market. No 2014-crop sales are advised.
Cash-only marketers: 50% sold on 2013-crop. No 2014-crop sales are advised at this time.
Price action: Cotton futures posted a strong upside day of trade and finished 40 to 175 points higher on the day, with nearbys leading to the upside.
Fundamental analysis: Traders covered short positions today amid ideas the downside was overdone last week and ahead of what will be an extended holiday break from the markets for some. An uptick in the pace of cotton stockpiling by China last week is easing concerns about possible plans to release some reserves onto the market. Concerns that recent rains in Texas will keep the pace of cotton harvest in the U.S. behind the norm added to the positive tone.
Technical analysis: December cotton futures gapped higher on the open and finished high-range, which should give bulls the near-term advantage. The contract must move above the Nov. 13 high of 78.50 cents to signal it is working on a low.
Hedgers: 50% of expected 2013-crop is sold in the cash market.
Cash-only marketers: 50% sold on 2013-crop production.