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Closing Comments

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Closing Comments

Corn finished lower as it continues its sideways trade. Favorable weather and trade preparation ahead of Friday’s USDA report has kept a lid on short covering. CONAB lowered their 2016 corn crop size to 68.5 mln mt vs the 69.1 mln July estimate. Brazil’s corn supply shortage has their FOB prices 40 cents a bushel above any other origin as they are currently focused on importing corn to meet their domestic needs. Funds were seen as net sellers today of some 7,000 contracts.

Soybeans closed higher, but off session highs as the 10th day of export sales announcement was tempered by the favorable weather outlook. Basis continues to strengthen at rivers on the ongoing demand from China and elsewhere. Canola traded higher along with soy oil on continued support for export demand. As Friday nears, the trade will be balancing the concern over the high crop condition ratings leading to record US yield but recognizing that the aggressive sales pace is soybeans will lead the USDA to cut the anticipated carry-out.

Wheat was mixed today as the shorts in the market remain content to hold their positions with the anticipation of the USDA raising production and ending stocks. USDA noted that the US spring wheat harvest was 30 percent complete, ahead of the five year average of 18 percent.

Cattle futures firmed today helped by firmer wholesale beef values. Feeders continue to lead the strength in price action. Grocers are looking to feature more beef during the Labor Day holiday and 30,000 shortfall in cattle available this week could underpin cash prices. October live cattle futures are in an overbought condition, but have been able to ride above trendline resistance for the fifth day now.

Hogs were softer in today’s trade as plentiful supplies continue to weigh on futures and cash markets. Peoria cash hogs traded steady.

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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