Corn                                             Estimated Fund Position
Trends – December Contract
Short Term:Down                     Net Long Futures and Options: -43845
Long Term: Down                     Change: -13000
Overnight Trade: N +8 Z +4 @7:30 AM

We saw very violent action in the July corn and in the bull spreads yesterday and we should expect to see more of the same today. The key thing to watch though is the $5.00 level in the December corn. The market is creeping towards in and a failure of that support will be a good  indication that traders have given up hoping for a weather rally this summer. Crop condition ratings improved by 2 points to 67% Good to Excellent, which is now slightly above the 5-year average. The bears will gain confidence if the ratings continue to improve.

Wheat                                           Estimated Fund Position
Trends – December Contract
Short Term: Down                      Net Long Futures and Options: -60123
Long Term: Down                       Change: -1000
Overnight Trade: Chicago: U +10 KC: U +9 @7:30 AM

Wheat held together yesterday and has posted gains overnight. The bounce in the December corn is helping to boost the wheat. The market is certainly due for a corrective bounce, so a move back towards $7.20 in the September KW wouldn’t surprise me, but at the moment I don’t see any indication of a change in trend.

Soybeans                                      Estimated Fund Position
Trends – August Contract
Short Term: Up                            Net Long Futures and Options: 66054
Long Term:Up                              Change: -4000
Overnight Trade: N -1 X +5 @7:30 AM

Like the corn the soybean condition ratings improved by 2 points to 67% Good to Excellent. This is well above the 5-year average and if the condition ratings really mean anything, then we have to expect excellent yields this fall. Harvest is a long way away, but right now there is no reason to expect any production problems. The job of the market will be to move low enough to attract enough demand to use up our excess supplies. Look for a corrective bounce in the November soybeans and then a move below $12.00.

Live Cattle
Short Term: Up
Long Term: Up
Opening Calls: 10-20 Higher

Live cattle futures closed moderately higher on Monday, with support from equity strength and a bull flag forming on the daily bar chart. Overnight activity is also trending higher, after trading in a broad 70 point range on both sides of unchanged. Weather over the long holiday weekend continues to look supportive for grilling activity. Packers will be buying for a full kill week in this weeks’ business. Two sided trade is likely in today’s action. The higher futures pricing should strengthen the resolve of cattle feeders to hold for better prices.

Feeder Cattle
Short Term: Up
Long Term: Up
Opening Call: 20-40 Higher

Feeder cattle futures had a monster day on Monday, posting triple digit gains across the board. The strength comes on the back of further losses in the corn market and expectations of yet lower prices in new crop corn’s future. Currently the corn is rebounding modestly but having little adverse effect on the feeders. Moderate gains of .40-.57 are being seen across the pit. Cash markets are also on fire, with 3.00-5.00 higher quotes in Oklahoma City on Monday and even stronger numbers in a large video auction that started this week.