Morning Outlook

Overnight Highlights

• Overnight markets have corn -1 ¼, soybeans -6, wheat -2, crude oil -.85, dollar -.07, gold -3.0 and the Dow -73.
• Grains lower this morning. USDA report out at 11:00 CT today. Trade trending toward hearing a bearish soybean number and friendly corn.
• Analysts are expecting a corn production of 15.03 bln bu from an avg yield of 173.4 bpa in today’s USDA report. This is vs the August estimate of 15.15 bln off a yield of 175.1 bpa.
• Analyst soybean expectations are for 4.09 bln bu from a yield 49.2 bpa vs last month at 4.06 bln and 48.9 bpa.
• Expectations for wheat are to be unchanged stocks for the US for 16/17 and a slight decrease for the world compared to the August estimate.
• Current analyst expectations are for Australia to have its best wheat crop in five years.
• French port workers will join a nationwide strike protesting labor market reforms on September 15^th.
• CFTC report showed Managed Money as of Tuesday returned as sellers of corn, adding -18,390 contracts to their now net short position at -180,893. They continue to reduce their long soybean position and added again to their huge wheat net short.
• On Friday, funds were estimated buyers of some 6,500 corn, 3,000 wheat and sellers of 1,000 wheat.

Commodity Weather Group Forecast

·         Early weekend rains heaviest SE KS/C. MO/SW IL/N. IN/far NW OH/SE MI/NE IA; wet fields limiting early harvest

·         Patchy Midwest showers tonight/tomorrow with quick frontal passage, but wettest Thu.-Sat. (favors west)

·         Midwest showers limited much of next week (drier), but 11-15 day trends wetter in C. & SW; no notable frost risks

·         Break in rain helps to limit damage risk, but lack of sustained drying still hinders early harvest (particularly KS/MO/IA)

·         6-15 day rains in South (particularly 6-10 day) hinder corn/soy harvest, but low damage risks

·         Canada wheat/canola harvest slows late next week, but favorable drying in meantime aids fieldwork

International Overview

·         Rains Aid East 1/2 Arg. Wheat This Week; Drier 6-15 Day Likely to Keep West 1/2 Under Stress

·         Ukraine Wheat Dry This Week; Showers Next Week Provide Spotty Coverage, With Up to 1/2 Belt Still Too Dry

·         Australia Rains Benefit E. 2/3 of Wheat This Week; Limited Rains West 1/3 Could Still Hamper Late Heading

·         Abundant Rains in India Next 10 Days End Crop Moisture Stress for All But South 15% of Groundnuts

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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