Price action: Corn favored a weaker tone in mixed trade and ended steady to 1 cent lower. Corn closed near opening levels and posted a narrow daily trading range.
Fundamental analysis: Periods of short-covering came from weakness in the U.S. dollar index and recent demand improvements. But ongoing weakness from harvest-related pressure and expectations USDA will raise its corn crop estimate in Friday's report limited buying. Traders shrugged off forecasts for precip later this week.
This morning's weekly export inspections report showed corn inspections above expectations at 31.316 million bushels. On top of recent gains in ethanol production, traders acknowledge prices are attracting export demand, but are hesitant to buy futures on fears higher prices might curb usage.
Technical analysis: December corn futures spent the day pivoting around Friday's low. Today's low of $4.25 1/4 is initial support. From there, support is layered every 5 cents lower to the $4.00 level. To signal a near-term low is in the works the contract needs to return above the October high of $4.49 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: November soybean futures closed 2 cents lower, while deferred contracts ended 1 1/2 to 5 cents higher. That was near mid-range for the day.
Fundamental analysis: Soybean futures were generally supported by light short-covering today as traders start to position themselves for Friday's Crop Production and Supply & Demand Reports from USDA. But expectations for an increase in USDA's crop estimates limits the upside to mild corrective buying. A favorable start to the growing season in South America also limits the upside.
Weekly export soybean inspections were again very strong at 80.559 million bushels. In the past two weeks, 164.22 million bu. of U.S. soybeans have been inspected for shipment. Despite the bullish demand news, soybean futures trimmed gains about the time weekly export inspections data was released.
Technical analysis: January soybean futures respected support at last Friday's low at $12.50 1/4, though the contract at a minimum would have to close above the October low at $12.61 1/4 to give the first clue that a short-term low may be in the works. A drop below $12.50 1/4 would make $12.31 3/4 the next downside target.
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 were unable to hold onto overnight gains and traded lower throughout the daytime hours, finishing on the lows of the day. SRW wheat futures closed 5 to 6 cents lower. HRW wheat closed down 4 1/4 cents through the September 2014 contract. HRS futures finished mostly 4 1/2 to 6 1/2 cents lower.
Fundamental analysis: Technical-related selling coupled with disappointment over the recent export pace sent wheat futures to their lower level in five weeks. Traders were especially disappointed in the weekly export inspections report, which came in at 7.146 million bu. in the latest week. That figure was down from 16.6 million bu. the previous week and well below expectations of 17 million bu. to 21 million bushels.
Rain with forecasts for more in the Plains and Midwest added to the bearish tone as the moisture is seen as favorable for the freshly seeded winter wheat crop.
Technical analysis: December SRW futures slumped when support at the 62% retracement of the rally from the September low to the October high failed, triggering sales stops. The $6.60 area is the next layer of support. The $6.75 area offers initial resistance on a rally with heavier resistance stating at $6.78 1/4.
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 continued their multiweek slide today and ended low-range with losses of 11 to 63 points. The December through May contracts hit new lows for the year.
Fundamental analysis: A meeting of the China National Reserves Corp. is underway, stirring up concerns the government agency may begin releasing some of its massive reserve stocks. This would likely take a substantial cut out of the country's need for cotton imports. It is estimated to hold more than 50% of world supplies in state reserves.
Countering such speculation, however, is news China nearly doubled its buys of domestic cotton for state reserves the week ended Nov. 1. But its total purchases are down 28% from year-ago.
Technical analysis: The next important layers of support for December cotton futures stand at the October 2012 low of 74.98 cents, followed by the November 2012 low of 74.35 cents. The contract must move back above 80.00 cents to signal it is working on a bottom.
Hedgers: 50% of 2013-crop production is hedged in December cotton futures at 83.87 cents. 50% of expected 2013-crop is sold in the cash market.
Cash-only marketers: 50% sold on 2013-crop production.