Corn
Price action: December corn futures fell 2 cents to $4.27 1/4 and near the session low.
Fundamental analysis: The corn futures market for much of the session held close to steady levels as soybean futures were lower and wheat futures were a bit firmer. Outside markets provided little direction for corn today as the U.S. dollar index and crude oil prices did not stray far from unchanged on the day.
South American crop consultant Dr. Michael Cordonnier left his Brazilian corn crop forecast unchanged at 125 MMT with a neutral bias. He also kept his Argentine corn crop estimate at 48 MMT.
World Weather Inc. today said South America weather “has been and will likely continue mostly good over the next two weeks. There is going to be some concern about dry pockets in central Argentina during the coming week, but relief should occur next week to prevent a more serious bout of dryness from evolving. Sao Paulo and northern Parana will also be left out of the greater rainfall for a while leading to drier soil conditions in time,” said the forecaster.
Technical analysis: The corn futures bulls have the overall near-term technical advantage. A four-week-old price uptrend is in place on the daily bar chart. The next upside price objective for the bulls is to close December prices above solid chart resistance at $4.50. The next downside target for the bears is closing prices below chart support at $4.10. First resistance is seen at the November high of $4.34 3/4 and then at $4.40. First support is at this week’s low of $4.22 1/4 and then at last week’s low of $4.17.
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 soybeans fell 11 1/4 cents to $9.98 1/2, while December soymeal fell $1.70 to $288.60, each forging low-range closes. December soyoil fell 68 points to 44.84 cents.
Fundamental analysis: Soybeans extended lower as technical pressure continued to curb buying interest. Meanwhile, mostly favorable weather in South America continues to hover over the complex, with additional rains in the forecast. World Weather Inc. reports a favorable distribution of showers and thunderstorms will occur through the next two weeks across much of Brazil and Paraguay keeping soil moisture favorable in most areas while inducing improvements in soil moisture and conditions for crop development in drier areas. Argentina, however, will see more sunshine than rain during the next two weeks, allowing fieldwork to advance well around rain in some northern areas today and widespread rain Saturday into Wednesday Nov. 27. The forecaster notes each round of rain will be important in ensuring most crops have enough soil moisture to develop favorably through the period.
As a result of recent weather improvements in Brazil, South American crop consultant Dr. Michael Cordonnier increased his crop estimate 1.0 MMT to 166 MMT. Cordonnier indicated the crop has had good emergence and stand establishment, with very few soybeans having to be replanted. He noted a neutral to higher bias toward the crop amid forecasted rains. He maintained his Argentine soybean crop estimate at 57 MMT, as some major growing areas remain dryer than normal.
Earlier today, oilseed lobby Abiove projected Brazil will harvest 167.7 MMT of soybeans during the 2023-25 season, stating, “the record volume that should also catapult exports and domestic processing to record highs.”
Technical analysis: January soybean futures ended the session back below the 20-day moving average of $10.02 and psychological support at $10.00. Initial support will now serve at $9.95 1/2, with additional support serving at $9.81 1/2, the Oct. 30 low of $9.77 1/4 and again at $9.73 1/2. Buying efforts will now face initial resistance at the 20- and 10-day moving averages of $10.02 and $10.08 3/4, respectively, which are backed by resistance at the 40- and 100-day moving averages of $10.18 3/4 and $10.32 1/2.
December meal futures faced support at $288.0 while initial resistance stood at the 10-day moving average of $292.80. An extension lower will face additional support at $285.80, then at last week’s low of $285.30 and again at $283.80. Meanwhile, an extension above the 10-day will battle further resistance at the 20-day moving average of $298.10, which is backed by psychological resistance at $300.00.
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.
Wheat
Price action: December SRW futures rallied 2 1/2 cents to $5.49 3/4 though closed well off intraday highs. December HRW futures climbed 3 cents to $5.58 1/4. December HRS futures rose 1 3/4 cents to $5.86 3/4.
Fundamental analysis: Wheat futures showed relative strength today and even posted solid gains at mid-morning, though profit-taking and resurgent selling pressure closed futures well off intraday highs. Wheat futures have been supported by increasing conflict around the Black Sea, as Ukraine used U.S. missiles to attack targets in Russia, while Russia vowed to retaliate and potentially escalate the conflict. That has sparked some buying interest, though volume has dried up and traders are becoming less concerned with geopolitical conflict, awaiting tangible changes to the world market before pricing in any potential changes to supply due to war.
Winter wheat conditions topping expectations in yesterday’s Crop Progress Report from USDA likely contributed to the increase in selling pressure today. USDA rated the winter wheat crop 49% “good” to “excellent” and 15% “poor” to “very poor.” On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop improved 10.2 points to 330.4 while the SRW CCI rating slipped 0.2 point to 371.3. The HRW crop is now 9.5 points above year-ago, while the SRW CCI rating is 2.9 points below last year on this date. Click here for details. Precip over the next week should support SRW conditions, while dryness is expected to return to HRW acres, notes World Weather Inc.
Technical analysis: December SRW futures climbed above the 10-day moving average but ultimately closed below it, rendering the technical advantage to the bears. That will stand as initial resistance at $5.51 3/4, which is backed by the 20-day moving average at $5.60, which capped intraday gains. Support lies at $5.41 1/2 then last week’s low of $5.30 1/2.
December HRW futures have shown relative strength to SRW futures recently, though bears hold the near-term advantage. Support stems from the 10-day moving average at $5.54 1/4, then the psychological $5.50 mark. Cotninued strength finds resistance at the 20-day moving average at $5.62 1/4.
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
Advice: December cotton futures enter delivery on Friday. With hefty profits in the 15% 2024-crop hedge held in December futures at 69.84 cents and the market short-term oversold, we advise hedgers to exit the position. We’ll reevaluate whether we need additional hedges after a correction – in time and/or price. Our exit was 66.67 cents for a 3.17 cent profit.
Price action: December cotton rose 27 points to 66.89 cents, nearer the session high.
Fundamental analysis: December cotton futures notched modest corrective gains as Monday’s low held as support. However, strong technical resistance continued to limit earnest buying interest, along with generally lacking outside market support. The subdued tone across the marketplace were a likely result of growing geopolitical tensions amid an escalating conflict between Russia and Ukraine.
USDA reported Monday the cotton harvest had advanced to 77% complete as of Nov. 17, up 6 points from the previous week. World Weather Inc. notes western Texas and southwestern Oklahoma will be dry during most of the next two weeks, but there will be a few rounds of showers that will slow harvesting and may discolor some cotton while the days during the period should allow some bleaching white of cotton fibers. However, dry weather will occur during much of the next two weeks in the Blacklands, Coastal Bend and south Texas with a few showers on occasion that should not bring enough rain to have a significant impact on soil conditions or farming activity.
Technical analysis: December cotton futures faced support at Monday’s low of 66.00 cents while resistance stood at the previous session high of 67.10 cents. Continued short-covering efforts will face additional resistance at 67.39 cents, then at 67.69 cents and again at the 10-, 20-, 100- and 40-day moving averages of 68.77 cents, 69.64 cents, 70.40 cents and 70.99 cents. Conversely, initial support will now serve at 66.33 cents, then 66.03 cents, which is backed by support at 66.00 cents and 65.65 cents.
What to do: Wait on a corrective bounce to extend cash sales.
Hedgers: NEW ADVICE – Exit the 15% 2024-crop hedges in December futures at 69.84 cents. Our exit was 66.67 cents for a 3.17 cent profit. You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.