Corn Estimated Fund Position
Short Term: Down Net Long Futures and Options: 212305
Long Term: Down Change: +7000
Overnight Trade: Z -6 @7:30 AM
Yesterday the corn market failed to build on Friday’s limit higher move and so far today the market is under pressure. There is still concern about harvest pressure, though harvest was reported at 54% complete, and our lack of exports which is tempering speculators enthusiasm. The biggest problem seems to be the lack of strength in the wheat and beans, both of which are surprising. However, basis levels are firm, most likely because forward contracts have been filled and end users must now go to work securing supplies. Weakness from here will most likely attract demand, so buy breaks.
Wheat Estimated Fund Position
Short Term: Down Net Long Futures and Options: 2127
Long Term: Down Change: -4000
Overnight Trade: Chicago: Z -12 KC: Z -12 @7:30 AM
The wheat market is heading back to the bottom of the trading range. Yesterday there has hardly any buying interest and the same goes for today. Russian wheat prices keep rising and eventually that will result in more exports, but traders want to see the business take place before committing to fresh long positions. The momentum is clearly lower today, so plan on the December KW moving to the $8.80 level.
Soybeans Estimated Fund Position
Short Term: Down Net Long Futures and Options: 156581
Long Term: Down Change: -10000
Overnight Trade: X -22 @7:30 AM
Soybeans are the downside leader again. The $15.50 support has failed in the November contract and it appears that the market is headed to the next retracement level at $15.15. The Chinese are loving this I am sure and we will be seeing more export sales. The fear is that USDA will raise the yield in next week’s supply and demand report, but the reality is that even if they do raise the yield we will still use all the beans that will be produced. Bottom picking is dangerous, but this break is a buying opportunity.
Short Term: Down
Long Term: Down
Opening Calls: Mixed
Live cattle futures closed sharply higher on Monday, with active new buyers and spillover strength from the lean hog pit. The December contract was particularly strong on the day, gaining 1.42 on a more than 5,000 jump in open interest. Overnight activity has been narrowly mixed, with a slightly weaker bias. The renewed buying interest on the first day of the new quarter should provide strong underlying support for this market.
Short Term: Down
Long Term: Up
Opening Call: Mixed
Feeder cattle futures jumped on the bull wagon on Monday, supported by sharp gains in live cattle and lack of follow through in the corn market. November was the daily leader, with gains of 1.27 on the close. Overnight prices are mixed to better, with corn off 5-6 cents as we write. Some improvement in pasture conditions should support the cash. A drop in open interest on the daily rally is not a supportive feature.
Source: Schwieterman Marketing, LLC, www.upthelimit.com , 620-275-4133