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Morning Outlook

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Overnight Highlights

  • Overnight markets have corn -1, soybeans -3, wheat -6-7, crude oil -.67, dollar +.75, gold -6.0 and the Dow +3.
  • Lower markets this morning as the market continues to anticipate large incoming fall crop yields.
  • Harvest should be picking up this week in the South and some isolated parts of Illinois. The trade will be tuned into early actual yield report chatter. Last year the first corn harvest progress updated came in the second week of September.
  • Trade is expecting unchanged for crop conditions this afternoon.
  • The annual Chinese buying delegation will be in the US this week. Look for the typical large soybean deal.
  • China’s recent buying frenzy slowed a bit last week.
  • CFTC data showed Managed Money as of Tuesday had covered some of their short corn position, had added to their long soybean position and slightly reduced their wheat short position. This does not include late week selling activity.
  • Funds were estimated sellers Friday of some 15,000 corn, 6,000 soybeans and 7,000 wheat.
  • Midwest rains are forecast to abate later this week before returning again in the extended forecast.

Commodity Weather Group Forecast

 

·         Weekend rain heaviest N. MN/west-central & NE IL/SW OH/W. TN/NW Alb. and near MO/KS border

·         Heaviest rain in C. & SW Plains/far SW Midwest through mid-week, lighter rains scatter into C. Midwest

·         Heavier rain expands in W. Midwest early next week & again in 11-15 day, hindering maturing corn/soy and fieldwork

·         Localized areas of excess rain in KS/E. NE/IA/MN/WI, but low risk of notable damage; favorably dry in most of Delta

·         Tropical systems near FL/NC too weak to threaten Southeast crops; 11-15 day system to watch, but low confidence

·         Breaks in 6-15 day allow slight improvement in Canada wheat/canola harvest, but Alb. still prone to frequent delays

International Overview

·         Typhoon Lionrock Leads to a Week of Widespread Heavy Rains; Greatest Flood Risk NE 1/4 China Soy

·         Weekend Rains Confined to NE 1/4 of Arg. Wheat; Mainly Dry Next 10 Days, Expanding Moisture Stress

·         Australia Rains Offer Extensive Benefit to East 1/2 Wheat/Canola This Week; Only Isolated Dryness in South

·         Majority of Europe/FSU Wheat Harvest Remains Favored by Limited Rain Potential Next 2 Weeks

 

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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