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Closing Comments


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Closing Comments

Corn lower but off the daily lows, finding daily support in December at 3.34 ½. USDA reported a sale of 101,600 mt to ‘unknown’ destinations. Export sales are still going strong, but Argentine and Ukrainian prices are trying to compete. Hot, dry conditions in Europe continue to press on the corn crop with Paris temperatures pushing 100 degrees today. Mid-day reports from the western leg of the Pro Farmer tour as it moved into Iowa saw good yields averaging in the 170-190 area, but unlikely to contribute to the USDA’s expectation of 197 bpa, which would be a state record by 5 bushels. With the continued rains throughout the corn-belt, more disease concerns are continually showing up with reports of Anthracnose as well as Diplodia and Gibberella Ear Rot and reports of kernel sprouts. Pro Farmer will wrap up the tour and release their final yield estimate tomorrow evening in Rochester MN. Reminder that the state by state yields, especially for MN, SD and NE will be adjusted for the final yield estimate to more accurately represent the state based on historical comparisons. Summary of the tour so far looks to be; generally good crop out there, but probably not a record.



Soybeans came under pressure today on continued good pod counts coming out of the Pro Farmer tour and a pick-up in South American selling. November finished in the middle of today’s price action and the seven day trading range. Traders are trying to decipher the impact of ongoing moisture in the central corn-belt and whether it is contributing to crop size for pod fill or reducing yield due to amplification of disease pressure in many areas. Concerns growing in several corn-belt sites on the continued growth of SDS and white mold.


Wheat dropped again this morning, let by Minneapolis – but by the close, KC was able to close all contracts incrementally higher, Chicago close slightly lower (but still a new low close in Dec) while Minneapolis which has led the rally suffered the most. Paris futures reversed for higher today after two days of steep losses, helping to give the winter wheats some support here. Agritel pegged the EU crop down 11% from 2015. The winter wheat markets need to prove they can hold on to today’s lows or will be threatening to break out of the recent consolidation. Price competitiveness on the global market should offer support below these price levels.


Cattle continued their march lower on weaker wholesale beef values. Yesterday afternoon’s choice beef dropped 75 cents. Cash cattle bids in TX and KS were at $115 vs $120 asking. Last week brought mostly $117-118. On the charts, October cattle continue to be drawn down by the open gap at $108 left on July 25th.


Hogs lower while cash hog prices today from around the Midwest were steady to weaker. Packers appear to have ample supply ahead of the long Labor Day weekend. The post-Labor Day slowdown in grilling has packers reluctant to get too aggressive on purchases.  


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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