Corn Estimated Fund Position
Trends – December Contract
Short Term:Down Net Long Futures and Options: -166747
Long Term: Down Change: +3000
Overnight Trade: Z -5 @7:30 AM
Export sales were very good with 134,000 MT of old crop and 1.09 MMT of new crop sales. Lower prices seem to be attracting demand. The market showed some strength at time yesterday and the December contract finally moved above the previous day’s high, which is a decent sign that we may be in for some short covering. On the negative side of the equation the forecasts remain favorable, which will make any rally difficult to sustain.
Wheat Estimated Fund Position
Trends – September Contract
Short Term: Down Net Long Futures and Options: -78655
Long Term: Down Change: +4000
Overnight Trade: Chicago: U -3 KC: U -3 @7:30 AM
The September KW closed decisively above the trend line resistance yesterday, which suggests we are in for some short covering. Export sales were good at 596,900 MT and the sales have been consistent, which is exactly what the wheat market needs to avoid being drug lower by the corn. $7.00 will be an important support level to watch in the September KW the next few sessions.
Soybeans Estimated Fund Position
Trends – November Contract
Short Term: Down Net Long Futures and Options: 44914
Long Term: Down Change: +2000
Overnight Trade: X -2 @7:30 AM
Soybean export sales were also very good with the old crop at 78,500 MT and new crop at 1.03 MMT. The market is certainly oversold and due for a corrective bounce, but I am not sure what will trigger the rally. It isn’t going to be the weather unless the forecasts make a dramatic change and the market typically doesn’t respond to new crop export sales. The best hope is some short covering ahead of the August supply and demand report due to fears of an acreage cut.
Short Term: Up
Long Term: Up
Opening Calls: Mixed
Live cattle futures closed mixed on Wednesday, with the front two months off modestly and deferred contracts posting modest gains. Confidence in the feedlots is at a recent high, in reference to this weeks’ cash potential. For the first time in weeks we hear the belief that cash will trade higher. Cutouts continue to struggle at midweek, with demand remaining lackluster. The Dollar is putting in new highs for the week, which could limit rally attempts. Open interest remains on the rise.
Short Term: Up
Long Term: Up
Opening Call: 20-30 Higher
Feeder cattle futures posted moderate gains on Wednesday, in the face of higher corn prices. Overnight corn prices have softened and the feeders continue regain positive momentum. The cash index was modestly higher on Wednesday, with weekly gains of nearly 300 to date. Improving moisture in the plains is going to create more competition for calves and yearlings over the coming months than we have seen for several years.