Corn
Price action: December corn closed 7 1/2 cents lower at $4.08 1/4, below the 40-day moving average.
Fundamental analysis: A gap lower overnight set the tone for corn futures, though the weakness across corn futures was deepened by followthrough selling in wheat and lacking outside market support, which included a U.S. dollar rally to a nine-week high. Meanwhile, favorable harvest weather in the U.S. combined with beneficial rains in South America have eased concerns across the marketplace thus limiting buying interest. World Weather Inc. notes the U.S. Midwest will be dry biased for at least ten days, while both Argentina and Brazil should encounter rainfall over the next ten days, with most areas receiving moisture at one time or another. The forecaster noted, however, distributing in Brazil is expected to be quite varied on a daily basis. AgRural reported earlier today that Brazil’s first season corn crop was 42% planted as of last Thursday, just ahead of last year’s pace of 41% for the same period.
Earlier today, APK-Inform lowered its Ukraine 2024-25 grain export forecast by 1.9 MMT to 37.2 MMT, mostly due to smaller-than-expected corn exports. The consultancy revised its corn export outlook down sharply to 20 MMT, down from 22.5 MMT, while corn harvest is expected to fall to 24 MMT, down from 26.8 MMT.
This week’s typical release of USDA’s Weekly Export Inspections and Crop Progress Reports will be delayed until tomorrow due to today’s observance of Columbus Day.
Technical analysis: December corn ended the session below the 40-day moving average of $4.09 1/2 for the first time in more than three weeks. Initial support will now serve at $4.05 1/2, which is backed by psychological support at $4.00, with little support layered until from here until the contract low of $3.85. Conversely, initial resistance will now serve at the 40-day moving average, then at $4.13 and again at the 20-, 10- and 100-day moving averages of $4.17 1/2, $4.22 1/2 and $4.23.
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: November soybeans sunk 9 1/2 cents to $9.96, closing on session lows. December meal futures climbed 20 cents to $315.3, near mid-range. December bean oil lost 143 points to 41.90 cents, near session lows.
Fundamental analysis: Soybeans struggled and failed to reverse overnight weakness following this morning’s open, ultimately closing nearer session lows. Selling pressure persisted in both corn and wheat throughout today’s session, further limiting buyer interest throughout the session. Volume was below average today as well, likely due to Columbus Day and traders having the day off. Government offices were closed today, which delayed the release of the Grain Inspections and Crop Production Reports until tomorrow. The weekly Export Sales Report from USDA will also be delayed until Friday this week.
Despite weakness in soybeans, the meal market bounced today, boasting the first daily gain in nine sessions. Meal has been a leader to the downside, so bulls will low for strength in meal to lead in a bounce as well. Calendar spreads in soybeans showed strength today as well, a sign a market bottom could be near at hand.
Brazil’s soybean planting reached 8.2% of expected area as of last Thursday, according to AgRural, less than half of last year’s 17% pace for that date and the slowest since 2020-21. Most of the delay is in Mato Grosso, where producers are awaiting consistent rains before increasing planting. Producers in Parana, where rains have been much better, are planting soybeans at the quickest clip since 2018-19. Rain is expected to pick up throughout Brazil in the next couple of weeks, giving producers the rain they have been waiting for to increase their planting rate.
Technical analysis: November soybeans struggled and failed to maintain any bullish momentum throughout today’s session, maintaining the recent downtrend. Bulls are seeking to overcome resistance at the psychological $10.00 mark before finding firmer resistance at $10.09, then the 10-day moving average at $10.20 1/2. Continued selling pressure finds support at $9.95 1/2 then $9.86 1/2.
December meal futures posted modest gains after trading higher for most of today’s session. Bears continue to maintain the near-term technical advantage. Bulls are looking to overcome initial resistance at today’s high of $318.6 before tackling the 10-day moving average at $322.7. A resurgence of selling pressure finds support at $312.6 then $310.5, the Aug. 15 closing price.
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 13 3/4 cents to $5.85 1/4 and near the daily low. December HRW wheat dropped 14 1/2 cents to $5.90 and near the session low. December spring wheat futures sunk 17 1/4 cents to $6.26 1/2.
Fundamental analysis: The wheat futures markets started out the trading week under selling pressure amid solid losses in the corn futures market and weaker soybean prices. A rally in the U.S. dollar index to a nine-week high and a drop in crude oil prices were bearish outside-market forces working against the wheat markets today.
The Columbus Day federal holiday today saw no USDA export inspections or crop progress data. Those reports will be out at their regular times on Tuesday.
World Weather Inc. today said U.S. wheat areas are expected to remain “quite dry in the Great Plains, while recent drier conditions in the lower Midwest, Delta and southeastern states were good for planting. Rain is needed soon in the Great Plains, Pacific Northwest and northern and western parts of the Midwest where crop moisture stress is expected for a while in early planted areas, while emergence and establishment are delayed until significant rain falls.” Meantime, some relief from dryness is expected mid- to late-week and during the weekend in eastern Ukraine and western Russia. Australia still needs greater rain in western and south Australia, said the forecaster.
Technical analysis: Winter wheat futures prices are still in seven-week-old uptrends on the daily bar charts, but the bulls need to show fresh power soon to keep them alive. SRW bulls’ next upside price objective is closing December prices above solid chart resistance at the October high of $6.17 1/4. The bears’ next downside objective is closing prices below solid technical support at $5.50. First resistance is seen at $6.00 and then at last week’s high of $6.11 1/4. First support is seen at $5.84 and then at $5.75. The HRW bulls’ next upside price objective is closing December prices above solid technical resistance at the October high of $6.23 1/2. The bears’ next downside objective is closing prices below solid technical support at $5.60. First resistance is seen at $6.00 and then at today’s high of $6.05. First support is seen at $5.80 and then at $5.70.
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 fell 118 points to 71.03 cents, closing nearer the session low.
Fundamental analysis: December cotton futures faced pressure to begin the week, stemming from lacking outside market support, though technical support limited selling interest. Meanwhile, the marketplace was unimpressed by China’s recent measures to advance stimulus efforts. The country’s finance minister Lan Fo’an held a news conference on Saturday to outline plans for increased fiscal support and economic stimulus. However, the announcement lacked specific details on the overall size of the stimulus package, which disappointed investors.
World Weather Inc. reports U.S. cotton areas will experience dry-biased conditions through this week, favoring maturation and some harvesting. Cool temps later this week may bring a threat of a soft frost to the northern Delta, Virginia and North Carolina, but the airmass will mostly moderate prior to getting into those areas.
USDA’s weekly Crop Progress Report will be delayed until Tuesday due to the observance of Columbus Day today.
Technical analysis: December cotton futures were able to end the session above the 10- and 20-day moving averages, which have nearly converged around $70.75, though the recent price trend has been broken, with bears looking to secure a close below the recent low of 66.26 cents. Initial will now serve at $71.48 cents, then at $72.49 cents and $74.23 cents, which is backed by the 40-day moving average of 75.57 cents.
What to do: Get current with advised sales.
Hedgers: You should also have 25% of expected 2024-crop production forward sold for harvest delivery.
Cash-only marketers: You should also have 25% of expected 2024-crop production forward sold for harvest delivery.