Schwieterman: Forecasted rain determines to direct corn futures

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Corn                                           Estimated Fund Position
Trends – December Contract
Short Term:Down                   Net Long Futures and Options: -132233
Long Term: Down                  Change: -6000
Overnight Trade: Z -5 @7:30 AM


December corn was unable to build upon the strength we saw at the end of yesterday’s session. There is still some concern about the forecasts and traders will want to see the rain hit the ground before putting too much more pressure on the corn market. However if the rain materializes as expected and the forecasts look ok, one has to expect more pressure and perhaps a quick trip to $4.50. Crop condition ratings will most likely decline on Monday, so that will give the bears some pause, but rain over the weekend will offset that concern.

Wheat                                      Estimated Fund Position
Trends – September Contract
Short Term: Up                       Net Long Futures and Options: -77722
Long Term: Down                  Change: -2000
Overnight Trade: Chicago: U +1 KC: U Unch @7:30 AM


The wheat continues to hang on, but that is all it is doing. The strong exports we have seen are certainly helping the market, but we have not seen enough bullish enthusiasm to actually move the market higher. The corn market is still acting as an anchor and holding the wheat market back, so we will have to see more export sales or bad weather in the Corn Belt to see the wheat move higher. The best idea may be buying wheat and selling corn on a spread and not worrying about price direction.

Soybeans                                  Estimated Fund Position
Trends – August Contract
Short Term: Up                        Net Long Futures and Options: 78397
Long Term:Up                          Change: -6000
Overnight Trade: X +1 @7:30 AM


There wasn’t much follow through selling in the soybean market overnight, but one has to suspect that it is coming if the weather cooperates. On the chart we have support in the November contract at the $12.50 and $12.25 areas and good weather will have the market testing those support levels next week. The Sunday night trade will set the tone for next week’s trade so that action will be critical.



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