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Midday Update

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Midday Update

·         Traders are nervously positioning for Friday’s USDA crop report while also trying to assess the significance of harvest delays and the weekend freeze in the northern Midwest.

·         Crop ratings improved for both corn and soybeans in USDA’s Monday afternoon weekly report.

·         Wild swings in the dollar are also impacting money flow both in and out of the broader commodity complex, adding to the volatility in the grain and oilseed complex.

·         Excessive rains over the next week, focused on southern and eastern portions of the belt, are expected to impact 30% of unharvested U.S. soybean crop and 20% of the total U.S. unharvested corn crop.

·         The dollar remains weak today, but above Friday’s low, resulting in a modest net positive money flow into the broader commodity sector.

·         Corn is up 5 cents after breaking above the 20-day moving average, triggering more short-covering.

·         Soybeans are up 7 cents for similar reasons.

·         Wheat is up 15 in Chicago, 17 in Kansas City and 19 cents in Minneapolis for these same reasons, plus dryness in Australia.

·         Live cattle are $1 to $2 higher on renewed optimism that the product market has carved out a bottom amid a limited supply of fat cattle.

·         Feeder cattle are up $1.50 to $2.20 on renewed demand for light-weight cattle.

·         December lean hogs are up $1.30 after breaking above their recent trading range on strong product prices and profitable packer margins. The meat complex is also benefiting from broad-based buying in the commodity sector as a whole.

 

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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Arlan Suderman | Senior Market Analyst
WATER STREET ADVISORY® | www.waterstreet.org
(316) 729-4599 | asuderman@waterstreet.org

Past performance is not indicative of future results. The information contained in this report is intended for informational purposes only and is the opinion of the writer and may change at any time. This information was compiled from sources believed to be reliable but accuracy cannot be and is not guaranteed. There is no warranty, expressed or implied, in regards to this information for any particular purpose. There is SIGNIFICANT RISK involved in trading futures and or options on futures and may not be suitable for all investors. Investors should consider these RISKS and evaluate their suitability based on their financial conditions. No one should ever consider trading futures or options on futures with anything other than RISK CAPITAL. This information is provided freely and is NOT in the capacity of a trading advisor. NO LIABILITY on the part of the author exists for any trading loss you may incur in the use of this information. Information provided is not to be construed as an offer to sell or solicitation to buy any commodity or security named herein.

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