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Closing Comments

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Closing Comments

Corn continues to struggle under the weight of large crop expectations and a cooperative weather outlook despite demand. Weekly export sales came in above expectations with 15/16 commitments now 31 mln above USDA expectations, however the shipment pace is still lagging what is needed. An article in the Ames Tribune noted that central Iowa yield plot estimates are coming in 2 to 9% below average with north west Iowa estimates 3 to 15% above average and southern Iowa just below the long term average. On the ethanol side, US plants are seeing unexpected demand from Brazil where production is falling short of expectations as high sugar prices are moving mills to crush more cane into sweetener than ethanol.

Soybeans found early support on weekly export sales coming in above expectations as well as new sales announced to China, but softened as the day progressed on the trade’s focus back on the cooperative weather outlook and high crop condition ratings. Gulf bids continued steady to firm today on the ongoing export demand. Talk in some areas of the Midwest seeing growing incidence of white mold. November soybeans continue to trade at the 200 day moving average, now for the fourth day.

Wheat gave up yesterday’s short covering gains as the large global supply has kept the trade comfortable holding their large short positions for now. Growing expectations for Russian production, the good US winter wheat crop and cooperative Australian weather are keeping the bulls in check. EU futures continued their recent price consolidation as production concerns continue to be off-set by large global supplies. The large fund short position and supportive global FOB prices should be able to help wheat continue to carve out a seasonal low.

Cattle futures ran into some profit taking as bids so far in the southern Plains stand at $114 vs asking of $120. Last week cash cattle traded $116-117. Wednesday’s afternoon choice beef was 80 cents higher while select was up 20 cents.

Hogs struggled again this morning, putting in new contract lows on this three week slide on suspect wholesale demand and the anticipation of greater supplies coming. Wednesday’s IA/MN cash hog price was $1.26 lower than Tuesday at $66.57.

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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