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Midday Update

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Midday Update

* Charts for the major commodity indices, of which the grains are a part, continue to look positive, attracting more buying today. The dollar has traded modestly on both sides of unchanged this morning, while crude oil bounced off support to reverse higher, trading over $1 above Monday’s close at times. That provides underlying support for the grain and oilseed sector.

* Soybeans are leading the grain sector as the trade focuses on strong upfront demand. Soymeal charts are turning higher, adding support for the oilseed. Spread trading has capped gains in corn at times, leaving it vulnerable on the charts, but the overall tone has been positive this morning.

* USDA’s daily export reporting service today confirmed that China bought another 8.8 million bushels of this year’s soybean crop. Their red-hot buying spree continues to close the gap after a slow start.

* Export shipments for the week ending October 9 totaled 22.6 million bushels of corn (soft), 14.5 million bushels of grain sorghum (strong), 67.3 million bushels of soybeans (huge) and 10.7 million bushels of wheat (poor).

* Corn futures are 2 cents higher, garnering support from the other markets after briefly probing below support at $3.80 this morning. Corn gets the weak side of corn/soybean spreads based on export demand, but is finding increased buying interest as soybeans rise.

* Soybeans are 17 cents higher as traders shift their focus to robust demand from China and amid good demand for soymeal on the export front. Soymeal futures are $6.50 per ton higher.

* Wheat futures are 8 cents higher in Chicago, 10 cents higher in KC and 7 cents higher in MN on global weather concerns, with added help from the broader commodity sector.

* October live cattle are 45 cents higher, while the deferred contracts are 35 to 80 cents weaker in consolidation this morning. Product prices are $2 to $4 higher this morning on routine movement.

* Feeder cattle are quietly mixed while waiting for clarity from the fats and corn markets.

* Lean hogs are generally 45 to 85 cents higher for most contracts, but up $1.78 for December after breaking above recent highs on the charts. Product prices are down more than $1 this morning while the cash market is steady to 50 cents weaker again.

All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.

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Arlan Suderman | Senior Market Analyst
WATER STREET ADVISORY(r) | www.waterstreet.org
(316) 729-4599 | asuderman@waterstreet.org

Past performance is not indicative of future results. The information contained in this report is intended for informational purposes only and is the opinion of the writer and may change at any time. This information was compiled from sources believed to be reliable but accuracy cannot be and is not guaranteed. There is no warranty, expressed or implied, in regards to this information for any particular purpose. There is SIGNIFICANT RISK involved in trading futures and or options on futures and may not be suitable for all investors. Investors should consider these RISKS and evaluate their suitability based on their financial conditions. No one should ever consider trading futures or options on futures with anything other than RISK CAPITAL. This information is provided freely and is NOT in the capacity of a trading advisor. NO LIABILITY on the part of the author exists for any trading loss you may incur in the use of this information. Information provided is not to be construed as an offer to sell or solicitation to buy any commodity or security named herein.

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