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Closing Comments

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Closing Comments

Corn traded both sides of unchanged today in a fairly stable range that favored the lower end of the trading range before closing higher on the day. The market continues to begrudgingly move higher spurred by consistently large demand, but without an overly threatening forecast to cause any fireworks. The market has a difficult balancing act ahead weighing a hot and highly variable precipitation period through late July to early August with an increasingly cool and wet forecast moving forward. Rumors of disease and rapid maturation continue to increase, with many farmers seeing these as limiting factors for final yield. Export sales this morning were at expectation, but large at 1.2 mmt. This puts us well above pace for new crop commitments for this time last year having sold 10.1 mmt vs just 6.6 mmt last year. Another sale of 101k mmt was also announced earlier this morning.

 

Soybeans had a wild ride lower today with a 20 cent range all to the bottom side finishing with a strong close on the highs to form a hammer bar on the chart. Demand continues to bring buyers into the market on any forays under $10, with seasonals also supportive into the beginning of September. Two more supportive factors that strengthened throughout the session were continued weakness in the dollar, and run-away strength in the crude market. Export sales were once again at expectations, but large for this time of year at 1.78 mmt, and soybean meal over expectations. Demand continues to show up, with the only question if we are going to have the large supply needed to match it.

 

Wheat continues to grind higher led by the higher protein of Minneapolis and Kansas as large supplies are overwhelmed by the search for quality. Wheat sales were within expectations at 459k mt, good, but not as supportive as last week’s 608k mt. Despite this back-off, wheat continues to advance against last year’s sale pace with nearly 70 mil more bushels committed verses last year’s pace.

 

Cattle held strength early in the session before capitulating into the close on profit taking and technical follow-through of recent action. Supplies of fed cattle continue to be ample with stable demand and a lower dollar hopefully stabilizing the market into fall. This morning’s cutout showed choice down .83 to 200.92 and select up 1.55 to 194.68.

 

Hogs had a strong finish to close just slightly lower on the day with a doji day showing indecision on the technical direction of price. Slaughter is up on the week running slightly under last week but about 45k head ahead of pace last year.

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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