Morning Outlook

Overnight Highlights

• Overnight markets have corn +1 ¼, soybeans +6, wheat +2, crude oil -.48, dollar +.05, gold -1.0 and the Dow +54.
• Higher markets overnight. Support from better meal prices in China and concern that wet weather could slow harvest. Expect harvest to pick up in the central and east.
• USDA reported corn harvest progress at 9% compared to 13% average for the date. Traded expected 11%. Winter wheat planting reported at 17% vs 18% on average.
• FOMC meeting this week. Market expects an interest rate hike to be deferred until December.
• Yesterday China sold 1,800 mt of 2012 corn but had no takers on the 2011 supplies nor the apparently less collectible 2013 model.
• Iowa’s ag secretary noted a large portion of the state remains wet, delaying the start of harvest. 52% of the state’s corn crop is rated as mature.
• Monday funds bought 4,000 soybeans and sold 2,000 corn and 500 wheat.

Commodity Weather Group Forecast

·         Very limited rains in Midwest yesterday (mainly WI); heavier rains in NC threaten cotton quality as 2/3 are open boll

·         Rains in NW 1/4 Midwest this week add to disease concerns in N. IA/S. MN/WI; elsewhere favorable drying all week

·         Showers early next week halt W. 1/2 Midwest harvest but eastern areas see only minor interruptions

·         Delta rains confined to W. 1/2 early next week limiting harvest delays; rains in NC today continue cotton quality threat

·         Extensive Plains wheat rains early next week benefit newly seeded fields but detract from W. TX cotton quality

·         Weekend rains in Canadian wheat/canola areas slow harvest but drier following week keeps damage threat limited

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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