Morning Commentary

Dec corn down 2 ¾ at $3.755

Nov beans down 8 at $8.835

The DOW is up

USD is weaker

Crude oil down $.47 at $71.31

Good morning,

Corn traders continue to debate longer-term supply and demand. Bulls are pointing to a slow U.S. harvest and thoughts the USDA could continue to backpedal in regard to their current 180.7 bushel yield forecast. Bears are pointing to better U.S. harvest weather in the forecast, cooperative weather in South American and Ukraine, and continued talk of more U.S. corn acres being planted next season. The USDA left weekly corn conditions “unchanged” at 68% rated GD/EX. States that showed deteriorating conditions were: Colorado -5%, Tennessee -4%, Minnesota, North Dakota, and Wisconsin -2%, Iowa and Ohio -1%. The technical trend is positive.   The market is poised for a near term test of channel resistance at 382 today.  A close under 362.25 warns of a setback.  System types are long risking 366.25.  In liquidation mode, I think trend followers would pause on a close below 362.25.  Given the fund short and modest bounce in wheat-corn over the past three days, corn is likely to be resilient today.  Money flow notwithstanding, the low 380 area may provide a nice selling opportunity.  From a timing standpoint, Oct 17th is a potential turning point.

Soybean bulls are talking about a few cargoes of old-crop U.S. beans loading and moving to China and the pace of harvest in big production states like Iowa and Minnesota falling to over -30% behind their historical pace. Bulls hope these fresh new headlines can help hold and build on the recent gains. Prices are up around +80 cents from the most recent lows. The USDA showed crop-conditons here in the U.S. deteriorating from 68% down to 66% rated GD/EX. Despite the recent reduction, this is still much better than last years 61% rated GD/EX. States showing weekly deterioration were: Iowa, Kansas and Ohio -5%, Missouri and Tennessee -4%, Arkansas -3%, Kentucky, Minnesota, Nebraska, and South Dakota -2%, Indiana and Wisconsin -1%. Technically, the short term trend is bullish. Look for a test of the low 900-area.  Closing under 861.5 warns of a setback.  System types are long risking 855.  I thought trend followers were risking 906.5; apparently it was 870.  The market is poised for an early correction.  However, with today marking the cutoff for Friday’s COT report, the bean market is vulnerable to further speculative buying.  Money flow notwithstanding, the low 900 area may provide a nice selling opportunity.  From a timing standpoint, Oct 17th is a potential turning point.

The Andersons, Inc. announced yesterday that it has entered into a merger agreement with Lansing Trade Group, LLC, its long-time affiliate, to acquire the 67.5% of Lansing equity that it does not already own for cash and stock currently valued at a total of approximately $305 million. (Source: PR Newswire)

September saw soybean crushings hit 160.779 million bushels which easily surpassed the previous September record by 3.373 million bushels. keep in mind, this is the 11th month in a row where crus hit monthly records. The trade was expecting numbers below August’s 158 plus million bushels.

In a letter to the White House, the U.S. meat industry and its emerging competitors in the field of lab-grown meat struck a truce. They said FDA and USDA should jointly regulate the new product that they agreed to call “cell-based meat and poultry.” The proposal would avert a potentially nasty fight among agencies over regulation of the products, including the question whether they can be sold as meat. (Source: FERN)

China over the weekend reported a new African Swine Fever case on a farm with nearly 20,000 pigs, the largest farm yet to report the highly contagious disease in the world’s top pork producer. The new case underlines the escalating threat to the country’s $1 trillion pig industry. The fact that the disease was confirmed on a significantly larger pig farm has some much more concerned. Keep in mind, China has the largest pig herd in the world with an estimated 500-700 million pigs. (Source: Reuters)


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