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Closing Comments

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Closing Comments

Corn funds were estimated as heavy sellers again today, and have exited nearly 1/3 of the long positions for the week.  A lack of weather concern in the short term has kept the pressure on and will continue to do so until crop condition ratings start to decline.  There are a lot of areas out there desperate for rain by now and unfortunately they missed out on the last system that moved across the corn belt.  Areas of concern would be in much of Nebraska, Southern Iowa, Missouri, and Western to Southeastern Illinois.  The drop in futures has pushed processor and many ethanol plants bids to firm up recently, and export sales also continue remain strong and we continue to be the cheapest source for positive news.  There was a bounce of the 200 day moving average on new crop corn, and funds will be eyeing that area.

Soybeans climbed slightly higher after the day session resumed because exports sales continue to be strong, but declined after late morning and into the close.  Argentina’s Ag Ministry had raised their 15/16 Soybean crop outlook to 58.0 mln mt, an increase of 440k mt over the prior.  Looking ahead, the USDA is expected to increase the export number by another 15-30 million bushels and will make the acreage estimate all that more important.

Wheat losses were kept in check by potential quality concerns in Europe and the Black Sea region after heavy spring rains.  Wheat still has the same story of big yields coming out of the fields so far, but might be able to push corn on some demand as cheaper feed in the near term. 

Live Cattle climbed throughout the day and found more buying off the recent swing low.  Many of the contracts have found their way back to a first resistance area, and see if it can break through tomorrow.  Feeder Cattle have also experienced this same rebound and back to same first resistance area.    Reminder that COF report out tomorrow.

Hogs saw another down day, but did well to close off of their lows and found some selling exhaustion.    Hogs & Pigs report tomorrow as well.      

Closing Market Snapshot

 

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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