Corn
Price action: December corn fell 3 1/2 cents to $4.26 3/4, closing near the session low.
Fundamental analysis: Corn futures gave back yesterday’s gains as the U.S. dollar rose to a more than thirteen month high, casting a shadow over commodities. However, strength in crude oil amid escalating tensions between Russia and Ukraine limited selling interest along with solid technical support.
Earlier today, USDA reported weekly export sales data for the week ended Nov. 14 which showed net sales of 1.49 MMT for the week, up 14% from the previous week but down 40% from the four-week average. Net sales were within the pre-report range of expectations of 1.0 MMT to 2.2 MMT. Exports during the week totaled 957,000 MT.
World Weather Inc. notes Brazil weather needs to be closely monitored over the next two weeks. The forecaster holds a below-normal precip bias for eastern Argentina, Uruguay, southern Brazil and southwestern Paraguay in December.
The International Grains Council increased its global corn production forecast for 2024-25 by 1 MMT from its October forecast to 1.23 billion metric tons, but also upped consumption by 4 MMT to 1.24 billion metric tons. Carryover stocks were reduced by 4 MT to 275 MMT.
Technical analysis: December corn futures held an inside range, limited by resistance at Wednesday’s high of $4.32, which is backed by resistance at $4.33 1/4 and the Nov. 8 high of $4.34 3/4. A close was held below the 10-day moving average of $4.27 1/4, though support will continue to serve at $4.26. An extension below the level, however, will face additional support at the 20- and 40-day moving averages of $4.21 1/2 and $4.19 1/2, which are backed by the 100-day moving average of $4.11 1/4 as well as psychological support at $4.00. Conversely, a move above $4.33, will face additional resistance at $4.36 1/4, and again at the 200-day moving average of $4.39 3/4.
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 12 3/4 cents to $9.77 3/4 and settled on session lows. January meal futures sunk $1.90 to $289.40, near session lows. January bean oil futures dropped 108 points to 42.28 cents.
Fundamental analysis: Selling was featured across the soy complex today, with deferred soybean futures posting fresh contract lows. The soy-plex underwent heavy selling despite impressive daily sales announced this morning. USDA reported daily soybean sales of 198,000 MT to China, 135,000 MT to unknown destinations, and with 133,000 MT of soymeal sales to the Philippines – all for 2024-25. That announcement piggybacked impressive weekly sales for the week ended Nov. 14. USDA reported net soybean sales of 1.86 MMT for the week ended Nov. 14, up 20% from the previous week but down 7% from the four-week average. Net sales exceeded pre-report expectations ranging from 1.0 MMT to 1.6 MMT. Exports during the week totaled 2.45 MMT, a marketing-year high. Despite continued strong sales and exports, total commitments are running at the second lowest clip out of the last five years, ahead of just 2023-24.
Beneficial rain continues to fall on Brazil, with light rain falling on a large part of western, central and southern Mato Grosso do Sul Wednesday, with several southern and northern portions of Brazil also receiving rain. The two-week outlook remains favorable for crop development with several rounds of showers, says World Weather Inc. Portions of southern Brazil are a little drier than ideal, but rain is expected to return to the area in the second week of the outlook.
Technical analysis: January soybean futures broke below the late October lows, though saw limited selling pressure below that mark. Bears continue to hold the near-term technical advantage, seeking to break below the Aug. 14 contract low of $9.73 1/2. A break below that mark finds support at $9.65 1/4. Initial resistance stands at $9.86 1/4 with additional backing stemming from the 10-day moving average at $9.97 1/2.
January meal futures continue to trade around recent lows with bears retaining the near-term technical edge. Bulls tried and failed to overcome initial resistance at the 10-day moving average at $293.00 today, while additional strength would find resistance at this week’s high of $294.70. Continued selling finds support at the contract low of $287.00.
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: March SRW wheat fell 2 3/4 cents to $5.69 1/2 and near the daily low. March HRW wheat dropped 5 1/2 cents to $5.67 1/4 and nearer the session low. March spring wheat futures slid 5 cents to $6.02 1/4.
Fundamental analysis: The winter wheat futures markets saw mild technical selling pressure today after posting decent gains earlier this week. A rally in the U.S. dollar index to a two-year high today also squelched buyer interest in the wheat markets. Higher crude oil prices today only somewhat mitigated the bearish aspect of a stronger dollar. Lower soybean and corn futures prices also kept the wheat markets bulls mostly on the sidelines today.
USDA this morning reported weekly U.S. wheat export sales of 549,600 MT for the week ended Nov. 14, up 45% from the previous week and 29% from the four-week average. Net sales were within the pre-report range expectations. However, exports during the week reached a marketing-year low of 133,900 MT.
Reuters today reported global wheat producers have been reluctant to sell their crops with prices near four-year lows. That has left flour makers with dwindling supplies and vulnerable to potential increases in prices.
World Weather Inc. today said U.S. hard red winter wheat areas “have benefited from recent weeks of rain with good root and tiller systems expected in many production areas. Cooler temperatures may slow crop development over the next couple of weeks, but additional establishment will occur slowly. The same is true for the Midwest, while cooling in the Pacific Northwest is pushing crops into dormancy.”
Technical analysis: Winter wheat market bears have the firm 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 March 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 $5.42. First resistance is seen at $5.80 and then at $5.90. First support is seen at $5.60 and then at $5.50.
HRW bulls’ next upside price objective is closing March prices above solid chart resistance at $6.00. The bears’ next downside objective is closing prices below solid technical support at the August low of $5.41. First resistance is seen at today’s high of $5.77 1/4 and then at $5.90. First support is seen at $5.60 and then at $5.50.
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: March cotton futures rose 15 points to 70.43 cents and closed above the 10-day moving average.
Fundamental analysis: Cotton futures climbed higher for the third consecutive session, supported by improving demand prospects for the U.S. crop. December futures posted strong gains midsession though closed well off intraday highs. USDA reported cotton sales of 327,400 bales for the week ended Nov. 14, over double the previous week and up nearly 70% from the four-week average. Vietnam led purchases, followed by purchases from Pakistan. While sales have improved recently, they remain poor, especially when compared to the pace of sales and exports in the past five years. The recent bounce in crude oil futures has helped lend spillover strength to cotton prices as well, with nearby futures about $4.00 above this week’s low.
Weather in Australia has turned more favorable recently, with recent rains and additional precip in the forecast, which will support dryland planting, emergence and establishment, according to World Weather Inc.
Technical analysis: March cotton futures closed the day out higher, though bears retain the near-term technical edge. Resistance at the 10-day moving average at 70.52 cents limited gains today. Strength above that mark finds resistance at 70.89 cents, then 71.86 cents. Meanwhile, support comes in at the psychological 70.00 cent mark then this week’s for-the-move low close of 68.91 cents.
What to do: Get current with advised sales and hedges.
Hedgers: You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.