Corn
Price action: December corn futures fell 4 1/4 cents to $4.28 1/4 and nearer the session low.
Fundamental analysis: The corn futures market today saw profit-taking from the shorter-term speculators after prices hit a three-month high Wednesday. Some keener risk aversion in the marketplace this week, due to higher tensions in the Middle East, also are likely squelching the cattle market bulls late this week. Add a rally in the U.S. dollar index to a six-week high today as a negative outside-market element for corn futures. Wheat and soybean prices were also under some selling pressure today, to limit buyer interest in corn.
World Weather Inc. today said good harvest weather is expected in the Midwestern states for the next 10 days to two weeks, which will also likely keep commercial hedging active as farmers bring their bountiful crop across the scales.
USDA today reported weekly U.S. corn export sales of 1.684 million MT for the week ended Sept. 26, surpassing analysts’ expectations. Exports totaled 1.170 million MT.
Technical analysis: The corn futures bulls have the overall near-term technical advantage. Prices are in a five-week-old uptrend 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 $4.08. First resistance is seen at this week’s high of $4.32 1/2 and then at $4.40. First support is at $4.25 and then at $4.21 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: November soybeans fell a dime to $10.46, while December soymeal closed down $8.60 at $332.80, each closing near the session low. December soyoil rallied 89 points to 44.53 cents, marking the highest close since July 23.
Fundamental analysis: A second day of notable pressure in soymeal futures and a rising U.S. dollar continued to dampen buying interest in soybeans, though soyoil gains, amid surging crude oil, curbed the downside. Meanwhile, USDA’s weekly export data, released prior to the open this morning, showed solid soybean sales of 1.444 MMT for the week ended Sept. 26, which was within analysts’ range of expectations from 1.0 MMT to 1.6 MMT. Export sales for 2024-25 are running 2.7% ahead of year-ago. Moreover, exports during the week totaled 724,600 MT, 199,900 MT of which were shipped to China.
Aside from some risk-off sentiments amid lingering geopolitical tensions, some expected rains in Brazil in the near-term likely weighed on the soy complex as well. World Weather Inc. reports a wetter weather pattern will begin Tuesday with nearly widespread rain by Friday of next week, when nearly all areas receive enough rain to induce at least temporary improvements in conditions for summer crop planting and establishment. However, the forecaster noted if follow-up rain does not occur soon, the soil will quickly dry out again. Much of western, central and northern Brazil will need greater rain later this month to induce lasting improvements in conditions for planting and establishment.
Technical analysis: November soybeans ended the session below the 10-day moving average of $10.46 3/4 for the first time since mid-September, as it has served up solid support. While today’s price action could largely be attributed to profit-taking amid overbought conditions, bulls will need to defend $10.40 and $10.25 as bears continue to seek a close below $10.00. A move higher will now face resistance at the 10-day, then at $10.65 1/2 and the 100-day moving average of $10.73 1/2.
December soymeal futures also ended the session below the 10-day moving average, currently trading at $333.50, but were able to hold above the 100-day moving average of $332.00, which will now serve as initial support. Moreover, additional support will continue to serve at the 20-day moving average of $327.80, then at $322.90 and the 40-day moving average of $319.10. Conversely, initial resistance will now stand at the 10-day moving average, then at $340.80, which is backed by the 200-day moving average of $343.00 and this week’s high of $351.60.
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 11 3/4 cents to $6.03 1/2, while HRW futures slid 7 3/4 cents to $6.11 1/2, each closing nearer the session low. December spring wheat fell 3 1/2 cents to $6.45 1/2.
Fundamental analysis: Wheat futures took back a portion of Wednesday’s gains as technical resistance at the 200-day moving average, combined with near-term overbought conditions. A strengthening U.S. dollar also cast a shadow over commodities in general following strong weekly export sales data, released first thing this morning. USDA reported net sales of 443,700 MT for the week ended Sept. 26, which were up noticeably from the previous week and exceeded analysts’ pre-report expectations ranging from 150,000 to 400,000 MT. Meanwhile, exports during the week totaled 531,700 MT.
While geopolitical tensions continue to fester in both the Middle East and Black Sea Region, global supply concerns are also lingering as key production areas continue to face weather problems. World Weather Inc. maintains drought remains a serious concern from eastern Ukraine into western Kazakhstan, although there is still time for improved rainfall for better emergence and establishment. Some showers are possible next Tuesday and Wednesday in a part of that dry region, but resulting rainfall should not be enough to seriously change the environment. In the U.S. drying in the U.S. Plains is beginning to raise concern over winter wheat establishment, despite some significant rain in HRW wheat areas during mid-September. Not much rain is expected for the next ten days and temps will continue to be quite warm, resulting in slow emergence and establishment in unirrigated fields. “Some producers may wait for rain before advancing much more with planting,” states the forecaster.
Technical analysis: While bulls continue to grasp the near-term technical advantage, December SRW wheat continued to face resistance at the 200-day moving average of $6.15 3/4 and ultimately ended the session back below the 100-day moving average of $6.05 1/4. Extended selling will face additional support at the psychological $6.00 level, then at 10-, 20- and 40-day moving averages of $5.88 1/2, $5.82 and $5.67. Meanwhile, resistance will now serve at the 100-day moving average, which is backed by the 200-day as well as additional resistance at $6.22 3/4, $6.30 1/2 and $6.43 3/4.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market. 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 67 points to 72.73 cents and nearer the daily low.
Fundamental analysis: The cotton futures market fell victim to more profit-taking pressure from the speculators today. There is also higher risk aversion in the general marketplace amid the escalating conflict in the Middle East. That’s limiting buying interest in cotton futures. A rise in the U.S. dollar index to a six-week high today was also a bearish outside-market element for the fiber.
World Weather Inc. today said dry weather in West Texas and the Texas Blacklands will be good for maturing crops and supporting fieldwork. Drying in the Delta and southeastern states is improving crop conditions after recent excessive rainfall. Some of the fiber quality was compromised in the Delta and southeastern states because of heavy rain and a small reduction in production was suspected as well, said the forecaster.
The cotton market may be impacted by Friday’s U.S. employment situation report for September. Traders want to gauge the health of the labor market and how it may impact the Federal Reserve’s monetary policy action this fall.
Technical analysis: The cotton futures bulls have the slight overall near-term technical advantage. A six-week-old price uptrend on the daily bar chart has stalled out. The next upside price objective for the cotton bulls is to produce a close in December futures above technical resistance at the September high of 74.55 cents. The next downside price objective for the cotton bears is to close prices below solid technical support at 70.00 cents. First resistance is seen at this week’s high of 74.00 cents and then at 74.55 cents. First support is seen at today’s low of 71.86 cents and then at last week’s low of 71.68 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.