Corn Estimated Fund Position
Short Term: Up Net Long Futures and Options: 238605
Long Term: Up Change: +6000
Overnight Trade: Z -3 @7:30 AM
Corn trade has been very quiet so far. Two numbers to watch in the December corn today are $8.09 ¼, which was last Friday’s close, and $8.10 ½, which is yesterday’s high. Two things that would definitely help the bull camp are a positive close for the week and a move through yesterday’s high. News is limited today and traders seem to be waiting for next week’s Pro Farmer crop tour, which will provided further confirmation of the production problems in the Corn Belt. I am still looking for the December corn to move to the top of the trading range soon.
Wheat Estimated Fund Position
Short Term: Down Net Long Futures and Options: 17327
Long Term:Up Change: +3000
Overnight Trade: Chicago: Z +7 KC: Z+6 @7:30 AM
The December KW is moving back above the $9.00 level due to concerns about wheat supplies in the FSU. $9.05 will be a key resistance point today and a close above that level today would be a clear indication that this market is headed back to the top of the trading range. As usual, some fresh demand news would provide a big boost to this market.
Soybeans Estimated Fund Position
Short Term: Down Net Long Futures and Options: 206985
Long Term:Up Change: -4000
Overnight Trade: Z +7 @7:30 AM
Soybean futures backed off following the yesterday’s good export sales report, but the market may make up for that today. Basis levels are still on the rise, which is a very bullish fundamental factor and I think there is a realization that regardless of what production is this year, we will use all the beans we have. Price breaks now will only serve to increase demand as make prices higher later in the crop year. Buy breaks.
Short Term: Up
Long Term: Up
Opening Calls: 10-30 Lower
The front end of live cattle futures closed sharply lower on Thursday, with triple digit losses in the August and October contracts. Profit taking and continued heavy deliveries against the August contract were features. Asking prices remain $122 in the south and $193+ in the north. Packers may wait until after the 2:00 release of the monthly on feed report to show their hand. Overall chart patterns remain positive, but need to see support over the next couple of days. Weekly export sales were the best seen in months and support ideas that high corn prices may be encouraging countries to import the meat rather than the corn to feed their own livestock.
Short Term: Up
Long Term: Down
Opening Call: 10-30 Lower
Feeder cattle futures closed sharply lower on Thursday, with the lead August contract down 1.75 at the close. Firm corn values, along with weakness in the live cattle provided plenty of reason for new hedgers to enter the market. Open interest climbed 778 contracts for the day. The new selling has spilled over into the overnight trade, with another .15-.30 of losses as we write. Cash index levels fell on Thursday and remain well discounted to the board prices. Placements in this afternoon’s report are expected to be down 9-10% from a year ago, but remain the second largest in 20 years.