Price action: Corn futures spent most of the day in positive territory and the market ended just off session highs with gains of mostly 4 to 6 cents. Funds bought 9,000 (45 million bu.) corn contracts today.
Fundamental outlook: Corn futures enjoyed some light followthrough buying to start the week as the market remains concerned about a relatively slow pace of harvest on a slow-developing crop. Rains kept farmers out of the field over the weekend. As a result, expectations are harvest reached just 20% complete as of Sunday. But there will be no USDA report data today to confirm or contradict expectations.
Light support also stemmed from news Brazilian firm Celeres trimmed its 2013-14 Brazilian corn production forecast by 1.5 MMT to 83.6 MMT. Also, corn export inspections the week ended Oct. 3 improved 3.355 million bu. from the week prior to 25.267 million bu., signaling lower prices are rebuilding demand.
Technical outlook: December corn futures have been consolidating above the $4.35 support level since the start of the month. Today's close above the August low and the September triple-bottom around $4.48 signals the market may be working on a seasonal low, but the contract must move back above the $5.00 mark to confirm that is the case.
Hedgers: 25% of expected 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 ended 1 1/2 to 7 1/2 cents higher following a two-sided day of trade. Meal closed higher while soyoil ended lower amid spreading.
Fundamental outlook: Given the lack of fresh news for the market to digest, it's impressive soybean futures continue to move off October lows -- especially during harvest time. Rains over the weekend pushed many producers out of fields, but a dry forecast this week means harvest will pickup as the week progresses. Weakness in the U.S. dollar index was supportive, especially given already-strong demand.
Brazil-based analyst Celeres raised its forecast for the country's 2014 soybean crop (see "Evening Report" for more). This reminded traders of the potential for global stocks to rise and strong export competition by next spring.
Technical outlook: November soybean futures saw trade above last week's high, making today's high of $13.05 initial resistance. Closes above that level would make bulls' next upside objective the the 38% retracement level of the rally from the August low to the August high around $13.16. Support lies at the halfway point of the rally near $12.87 and then the Oct. 1 low at $12.63 1/2.
Hedgers: Get to 100% sold in the cash market on expected 2013-crop production. We'll manage risk on the board the remainder of the marketing year.
Cash-only marketers: Get to 75% sold on expected 2013-crop production.
Price action: SRW wheat futures closed mostly 6 to 8 cents higher, HRW finished mostly 6 to 7 cents higher and HRS futures ended mostly 4 to 6 cents higher. All three flavors ended high-range for the day.
Fundamental outlook: Wheat futures were supported by ongoing global crop concerns. Excessively wet conditions in Ukraine and Russia are cutting planted acreage estimates, which suggest there will be less -- potentially far less -- export competition from the Black Sea region down the road. Meanwhile, crop woes due to a late-season cold snap in Argentina also has traders expecting a pickup in demand for U.S. wheat.
According to USDA's Grain Inspection, Packers & Stockyards Administration website, wheat export inspections for the week ended Oct. 3 totaled 29.781 million bu., which was down from 32.973 million bu. the previous week. Still, demand hopes for U.S. wheat are perking up.
Technical outlook: December SRW wheat futures must push above last week's high at $6.98 and the psychological $7.00 mark to spark a fresh wave of chart-based buying needed to extend the price recovery. The July high at $7.05 3/4 would be the next upside hurdle.
Hedgers: 50% of 2013-crop is sold in the cash market.
Cash-only marketers: 25% of 2013-crop is sold.
Price action: Cotton futures closed 205 to 326 points lower through the March 2015 contract today, which was low-range.
Fundamental outlook: Weather provided the basis for corrective selling in the cotton market today as Tropical Storm Karen was downgraded to a depression on Sunday and the remnant rains will be much lighter than previously expected. With the weather threat reduced, traders actively took profits out of the market.
Technical-based selling also weighed on the market as futures triggered sell stops as levels of chart support were violated. Traders ignored weakness in the U.S. dollar index today.
Technical outlook: December cotton futures erased three weeks of price gains in one fell swoop today. Last week's high at 87.78 cents now stands as tough resistance, while the contract is pointed toward a test of support at the September low at 82.11 cents and possibly a test of key support at 81.72 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.
Cash-only marketers: 50% of expected 2013-crop production is sold via cash forward contract for harvest delivery.