Corn:
Dec corn down 2 1/4, pinned to the key 500 area with an excellent 2 week harvest window opening, the dollar at new contract highs this week and poor export sales at 535,989 tonnes, putting cumulative sales at 22.6% of USDA’s forecast vs the 30% five year average. Open interest fell nearly 30,000 contracts yesterday as liquidation continues, and StoneX cut its yield estimate to 182.1 BPA. Retracement support at 488 is the next downside target: close in resistance 507.
Soybeans:
Nov beans down 6 3/4 at a new one month low: China’s Golden Week, a 2 week dry and warm harvest forecast and the strong dollar all stack up against the heavy managed money long. August crush set a record for the month at 209.63 million bushels and bean oil stocks came in well below guesses at 1.696 billion pounds, the friendly notes in an otherwise bearish picture. Western belt basis is softening as plants pull back their premiums: next support is the 50 day moving average at 1258.
Wheat:
Dec Chicago wheat up 2 3/4, and wheat has a different feel than corn and beans: funds are net short and the market is already down sharply, with the bearish southern Plains rain likely priced in. Putin rejected Ukraine’s offer of a mutual strike halt, Ukraine’s September wheat exports were nearly half of last year’s, and Estonia banned Russian grain transit with Latvia and Lithuania possibly next, putting Russia’s Baltic route at risk. A strong close today would signal a near term upside correction: next resistance 705.
Livestock:
Dec live cattle rebounded late to their best close in 2 weeks on stronger southern cash bids, with light Kansas trade heard at 226: next resistance is the September highs at 225.42, pullback support has moved up to 220.25, and Nov feeders closed above the neckline of a bullish head and shoulders bottom. Boxed beef cutout dropped $6.00 to $376.79, the offset to the cash strength. Dec hogs hit another new contract low before recovering, with open interest up more than 4,650 on the break: this afternoon’s COT may show another record managed money short, with 71.62 the trigger for aggressive covering and support at 66.90.
Energy:
Corn use for ethanol in August was up 4% year over year per yesterday’s Grain Crushings data, the one demand bright spot against this week’s weak export sales. Ethanol grind strength will matter more as harvest supplies build.
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