Corn                                  Estimated Fund Position
Trends – December Contract
Short Term:Down              Net Long Futures and Options: -157260
Long Term: Down              Change: -3000
Overnight Trade: Z Unch @7:30 AM

The December corn posted an outside day down yesterday, but there has been very little action so far today. It still appears that the December contract is headed to the August lows near $4.45. The bulls have to find it frustrating that the market was given some potentially bullish data from FSA and the market did nothing with it, but I believe that stems from the fact that the correlation between the FSA data and the NASS figures is rather sketchy. Meanwhile yield reports are still good and as long as that is the case there will be a great deal of overhead resistance.

Wheat                                   Estimated Fund Position
Trends – December Contract
Short Term: Down                 Net Long Futures and Options: -83412
Long Term: Down                  Change: +1000
Overnight Trade: Chicago: Z +1 KC: Z +1 @7:30 AM

The December KW has begun yet another sideways session. When a market keeps scraping along the lows it is hard not to fear a major failure, but I don’t think the fundamentals warrant a sharp break unless the corn market falls apart. The new crop fundamentals are a bit weaker, and the July market has made new contract lows the past two sessions, but the moves have basically been in line with the action in the front months. For the time being selling options looks like the best strategy.

Soybeans                                 Estimated Fund Position
Trends – November Contract
Short Term: Up                         Net Long Futures and Options: 104310
Long Term:Up                           Change: -4000
Overnight Trade: X -6 @7:30 AM

Yesterday the November soybeans started to fall out of the bottom of the trading range. The market has been quiet overnight, but since the market didn’t view yesterday’s FSA data as friendly, one has to start looking for new downside targets and right now $13.15 and $12.85 are what we have to be looking for. Look for sideways to lower trade as we move towards the September 30th stocks report.

Live Cattle
Short Term: Down
Long Term: Down
Opening Calls: 20-40 Lower

Live cattle futures closed moderately lower on Tuesday, with modest bull spreading a market feature. Overnight trade is trending lower once again, with the front two months trading inside Tuesday’s range and deferred contracts posting new lows for the move. Boxed beef prices continue to struggle, which should keep packer kills at a reduced speed. Friday’s on feed report should show another month of reduced placements. The improved moisture in the plains should limit feedlot placements in the coming months.

Feeder Cattle
Short Term: Up
Long Term: Down
Opening Call: 30-50 Lower

Feeder cattle futures closed sharply lower on Tuesday and are posting new two week lows in overnight trade. The weakness comes in spite of better pasture conditions and corn trading at its’ lowest level in the past month. The cash index was up .10 to 156.43 but remains a discount to the September futures. Friday’s report is expected to be supportive to the complex.