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Closing Comments


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Closing Comments

Corn saw another round of small short covering due to commodity funds holding a large net short position and making it vulnerable to that type of action.  Corn coming in under expected harvest pace along with private analysts trimming back on expected corn yields helped to provide the fundamental reasons.  Another private sale announcement of 100k mt  to an unknown destination also helped firm corn up today.     


Soybeans harvest was a little ahead of pace than the average trade guess.  Northern Brazil had some favorable rains overnight where planting to beginning to get underway.  Fact that FC Stone increased their yield guess for the U.S. 2016 soybean yield to a record 52.5 bushel per acre also contributed to the profit taking from previous 3 day rally.  Longer term supportive news was announced this morning that Argentina will not reduce export taxes this year or next and should continue to keep exports business booming.


Wheat was interesting in the overall complex with the most attention being paid to a stronger Minneapolis December contract, while KC December wheat showing the biggest loss.   The spring wheat is benefiting from Western Canada looking for some higher protein wheat as heavy rain over the region has lowered their quality expectations.  Egypt announced a late sale of 240k mt of Russian origin wheat.


Cattle finally put in a power up bar on the cattle charts after trigger short covering and taking out yesterday’s high.  Price action looks much better for longer term, but small retracements could also be expected.  Firmer wholesale beef prices helped bring a lot of short covering over the last couple of trading sessions.   


Hogs were mixed in the contracts and the nearby have not been able to shake the weak fundamentals and technical selling.  Deferred contracts have been strengthening the last couple of sessions and look to maintain that pace with a stronger market today.


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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