Price action: Corn futures finished well off session lows with losses of 3 to 6 1/4 cents in all but the front-month contract, which ended 3/4 cents lower.
Fundamental analysis: Corn futures traded sharply lower in reaction to USDA's unexpected uptick to its crop peg. Traders expected USDA to trim its corn yield projection, but instead a higher yield peg and unchanged acreage led to an 80-million-bu. increase to the crop from last month. While USDA trimmed 2012-13 corn carryover more than expected to a very tight 661 million bu., it raised 2013-14 carryover by 18 million bu. to 1.855 billion bushels.
USDA also raised its 2013-14 global corn carryover peg by 1.25 MMT from last month to represent a 24% increase in stocks from last year.
Technical analysis: December corn futures posted a weekly low of $4.56 1/5 on today's plunge but finished mid-range. Today's low is initial support, followed by the August low of $4.45 3/4.
Hedgers: 100% sold on 2012-crop in the cash market. 25% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 100% sold on old-crop. 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Price action: Soybean futures surged following the release of USDA's Crop Production and Supply & Demand Reports, closing near the day's highs and contract highs. September through January futures ended 35 1/2 to 37 3/4 cents higher.
Fundamental analysis: Soybean futures got a lift from today's USDA reports that showed 2013-14 carryover stocks slumping to levels lower than expected by traders. Except for the lower-than-expected carryover figure, the reports came in about as expected, confirming a decline in harvest prospects due to the late-season heat.
Earlier, the market saw some light selling pressure after today's disappointing soybean export sales report, which showed sales of 478,100 MT for 2013-14 for the week ended Sept. 5. A total of 928,500 MT were carried over from the previous marketing year.
Technical analysis: The late surge in November futures carried that contract to its highest close since Sept. 14, 2012. The climb sets up a test of resistance at the contract high of $14.09 3/4. The $13.40 area continues to provide support. Filling the Aug. 26 upside gap at $13.31 1/2 would suggest a short-term top is in place.
Hedgers: 50% of expected 2013-crop production is sold via a forward-price cash contract for harvest delivery. 100% sold on 2012-crop in the cash market.
Cash-only marketers: 50% of expected 2013-crop production is sold via a forward-price cash contract for harvest delivery. 100% sold on 2012-crop in the cash market.
Price action: The wheat market favored the downside this morning and immediately after the release of USDA's reports But buying interest gradually returned, helping SRW wheat to close 4 3/4 to 6 3/4 cents higher, while HRW wheat ended with gains around 7 to 9 cents. HRS wheat finished roughly 1 to 4 cents higher.
Fundamental analysis: USDA's report data for wheat and corn favored market bears today. The department raised its wheat carryover estimate by 10 million bu. from last month to 561 million bu., whereas traders had expected just a 5-million-bu. increase. USDA also upped its global carryover peg for 2013-14 by 2.43 MMT to 176.28 MMT.
But with these reports quickly digested by the market, traders returned their attention to dry soil conditions in the Southern Plains as planting picks up as well as a solid, if not impressive, weekly export sales tally. There is some skepticism about USDA's decision not to raise its export forecast.
Technical analysis: December SRW wheat tested but respected tough contract-low support at $6.35 1/2 today. The contract needs closes above $6.79 3/4 to signal a low is in place; the contract has been unable to penetrate that level since late July.
Hedgers: 50% of 2013-crop is sold in the cash market.
Cash-only marketers: 25% of 2013-crop is sold.
Price action: Cotton futures initially dropped following the release of USDA's reports today, but buying interest quickly returned and futures ultimately settled high-range, with the front month 108 points higher and the rest of the market up 38 to 69 points.
Fundamental analysis: Report data from USDA got a friendly read from market participants as USDA lowered its cotton production estimate by 200,000 bales from last month to 12.90 million bales. Pre-report expectations were for the department to leave this figure unchanged. This also resulted in a slightly smaller-than-expected 2013-14 carryover estimate at 2.90 million bales. The market largely brushed off an uptick in USDA's global carryover projection.
Light support also came from a solid weekly export sales tally for the fiber this morning, though this is tempered by USDA's decision to lower its U.S. cotton export forecast for 2013-14.
Technical analysis: December cotton futures posted slight gains for the day and left the mild uptrend since the start of the month in place. The September low of 82.11 cents remains strong support, while initial resistance is around the July high of 87.11 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.