Corn
Price action: December corn fell 7 1/2 cents to $4.19, closing below the 10-day moving average.
Fundamental analysis: Corn futures continued to grind lower, marking losses for the fourth straight session as persisting U.S. dollar strength summoned selling across the grain complex. While there were no daily corn sales today, the Energy Information Administration reported record ethanol production of 1.113 million barrels per day (bod) during the week ended Nov. 8, rising 8,000 bpd (0.7%) from last week and 6.3% from last year. Meanwhile, ethanol stocks rose 19,000 barrels to 22.039 million barrels.
In South America, weather continues to prove mostly favorable for planting corn. Although World Weather Inc. reports there is going to be some “concern” around dry pockets in interior southern Brazil, Paraguay and central Argentina during the next couple of weeks, but no serious bout of dryness is expected. The forecaster noted Argentina will have the most persistent dry bias. With planting efforts ramping up as of late, Conab increased is Brazilian corn crop forecast by 70,000 MT to 119.81 MMT but left its 2024-25 corn export forecast unchanged at 34 MMT.
USDA delayed its typical Thursday morning release of its weekly Export Sales Report due to Monday’s Federal Holiday and will be reported Friday morning ahead of the open. Analysts are expecting net sales to have ranged from 1.25 MMT to 2.6 MMT during the week ended Nov. 7. Last week, net sales of 2.77 MMT were reported for the previous week, which were up 18% from the previous week and four-week average.
Technical analysis: December corn extended below the 10-day moving average of $4.23 3/4 though additional support at the 20- and 40-day moving averages, each trading around $4.18 curbed heavier selling efforts. A corrective move to the upside will now face initial resistance at the 10-day moving average, then at $4.26 3/4, $4.29 1/2 and again at last week’s high of $4.34 3/4, which is backed by the 200-day moving average of $4.41. Conversely, an extension lower will now face initial support at the 20- and 40-day moving averages, which are backed by the 100-day moving average, currently trading at $4.11 1/4 and psychological support at $4.00.
What to do: Get current with advised sales.
Hedgers: You should be 20% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 20% sold on 2024-crop.
Soybeans
Price action: January soybean futures plunged 20 1/4 cents to $9.87 1/2, settling near session lows. December meal futures made a new contract low, closing $4.60 lower to $287.00. December bean oil futures gave up early gains and closed 74 points lower to 44.44 cents.
Fundamental analysis: The soy complex underwent heavy selling pressure today, with January soybeans closing lower for the fourth consecutive session. Reports of China slowing imports and beneficial growing conditions in Brazil are weighing heavily on soybean futures. Meal futures continue to undergo heavy selling pressure and are within $10.00 of the Covid lows. Surging soy use for crushing has traders anticipating an excess of soy meal supplies, keeping meal futures under pressure. NOPA will release crushing data for October tomorrow, traders anticipate NOPA crush to have totaled a record 196.843 million bushels, though estimates varied widely from 189.5 to 205.2 million bushels. Analysts expect soy stocks to have totaled 1.090 billion lbs. at the end of October.
Conab increased its 2024-25 Brazil soybean crop forecast by 140,000 MT from last month to 166.14 MMT. Soybean plantings are expected to rise 2.6% to 47.35 million hectares, up from 47.33 million hectares expected last month. Despite the slightly bigger production forecast, Conab lowered its 2024-25 soybean export outlook to 105.47 MMT, down 70,000 MT from last month. Rain fell on Wednesday from east-central and northeastern Mato Grosso to Minas Gerais, central Bahia, and Espirito Santo with the moisture most beneficial in northern Minas Gerais and nearby Bahia where soil moisture is still short in some areas, says World Weather Inc.
USDA reported daily soybean sales of 176,000 MT to unknown destinations for 2024-25. USDA will release weekly export sales data tomorrow morning, delayed a day due to government closures for Veterans Day Monday. Traders expect soybean sales between 1.0 and
Technical analysis: January soybean futures underwent heavy selling pressure, breaking below psychological $10.00 support as bears hold a modest near-term technical advantage. A trip to the Oct. 20 low of $9.78 1/2 seems likely, which is backed by the contract low at $9.73 1/2. The psychological $10.00 mark stands as initial resistance, which is backed by the 10-day moving average at $10.06 1/4.
December meal futures closed lower for the fifth consecutive session as bears continue to maintain full control of the technical advantage. Tentative support stems from today’s low of $285.90, which is backed by $280.00. Resistance comes in at $289.80 then the Nov. 6 low of $293.10.
What to do: Get current with advised sales.
Hedgers: You should be 20% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 20% sold on 2024-crop.
Wheat
Price action: December SRW wheat fell 10 3/4 cents to $5.30 1/4, near the daily low and hit a 2.5-month low. December HRW wheat fell 7 3/4 cents to $5.33 and near the session low. December spring wheat futures closed 3 1/4 cents lower to $5.67 3/4.
Fundamental analysis: The wheat futures markets saw more technical selling pressure today amid bearish charts. A strong U.S. dollar index that today hit another six-month high continues to squelch buyer interest in the grain markets. Solidly lower corn and soybean futures prices today also pushed some spillover selling into the wheat markets.
Weather in U.S. wheat regions leans price-bearish. World Weather Inc. today said “a significant rain event Sunday through Monday will further reduce long-term moisture deficits in the U.S. HRW region. This rain will be beneficial for maintaining improved topsoil moisture and increasing subsoil moisture. Dry and unusually warm conditions today through Saturday will be good for better stimulation of wheat establishment and support of late-season fieldwork. Strong winds could occur frequently next week along with an unusually cold air mass. Snow may fall in northeastern production areas Tuesday through Wednesday.” Meantime, in the northern Plains, rain and snow shower activity through Monday afternoon “should be minor enough to not have much of an effect on any remaining fieldwork,” said the forecaster.
Friday morning’s weekly USDA export sales report is delayed one day by the federal holiday Monday. U.S. wheat export sales are expected to come in between 250,00 and 550,000 MT for the 2024-25 marketing year, and sales of zero to 50,000 MT for the 2025-26 marketing year. Wheat market bulls are hoping for marked improvement from last week’s U.S. wheat export sales that were a marketing-year low.
Technical analysis: Winter wheat market bears have the solid overall near-term technical advantage. Six-week-old downtrends are in place on the daily bar charts. SRW bulls’ next upside price objective is closing December prices above solid chart resistance at $5.80. The bears’ next downside objective is closing prices below solid technical support at the August low of $5.20 3/4. First resistance is seen at today’s high of $5.44 1/4 and then at $5.50. First support is seen at $5.20 3/4 and then at $5.10. HRW bulls’ next upside price objective is closing December prices above solid chart resistance at $5.80. The bears’ next downside objective is closing prices below solid technical support at the August low of $5.27 1/4. First resistance is seen at Wednesday’s high of $5.49 and then at $5.60. First support is seen at $5.27 1/4 and then at $5.15.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market for 2024 crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 70% sold for the 2024 crop. You should also be 20% sold for harvest delivery for expected 2025-crop.
Cotton
Price action: December cotton futures sunk 58 points to 68.32 cents, settling on today’s lows.
Fundamental analysis: Cotton futures tried and failed to rally today, reversing early gains and closing near session lows. The U.S. dollar index continues to work higher, working to the highest level in over a year today, which has weighed heavily on export dependent cotton. Still, historically cotton futures tend to work higher in the winter months, which bulls are seeking to build on. Selling pressure in the stock market, spurred by higher-than-expected producer price inflation, bringing woes over the return of inflation and drawing question to how much the Federal Reserve will be able to cut rates in the coming months. USDA will release their weekly export sales report tomorrow. Last week, USDA reported sales of 241,300 MT, a marketing year high. Interest in U.S. cotton has picked up as prices have fallen, despite continued strength in the dollar. Bulls have been encouraged by countries returning to the U.S. market which have been largely absent in months prior, including China, Indonesia and India.
Technical analysis: December cotton futures continue to chop around near recent lows in indecisive trade, though bears continue to maintain the technical advantage. The 10-day moving average at 71.86 cents capped gains today, while additional strength seeks to overcome resistance at 72.71 cents. Support stems from yesterday’s low of 70.22 cents then the psychological 70.00 cent mark.
What to do: Get current with advised sales and hedges.
Hedgers: You have 15% of 2024-crop production hedged in December futures at 69.84 cents. You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.