Markets are seeing nice gains overnight with wheat and beans the strongest as middle eastern tensions are elevating again and activity between Russia and Ukraine is picking up too.
Friday’s cftc report showed on the week ending 9/17, funds were net sellers of 3k corn to push the net short back out to 135k, buyers of 8k beans to reduce the net short to 122k, and net buyers of 4k wheat to reduce the net short to 29k.
Funds on Friday were estimated as net sellers of 5k corn to push the net short out to 148k, net buyers of 2k beans to reduce the net short to 115k, and net buyers of 1k wheat to reduce the net short to 28k.
Ukraine’s Ag Ministry said their grain exports since the beginning of their marketing year were 9.4 mmt, which is up from 6.2 mmt from the same time a year ago.
Safras reported Brazil soybean planting at .5% complete, which compares to 1.6% a year ago. Hot and dry conditions have slowed the pace of planting as seasonal rains have been slow to materialize.
Corn posted lower lows, lower highs, and a lower close on Friday with the market dropping back below the 20 and 50 DMA’s. The market has recovered above those moving averages this morning with the market oversold after last week’s drop. Support for Dec. is 4.00-4.04 and resistance 4.20-4.30.
Beans traded an outside day on Friday, finishing with small losses. The market found support overnight at the 50 DMA with prices testing the top of its recent range this morning. Directional indicators are still neutral, but it is a bit overbought after recent gains. Support for Nov. is 10.00-10.10 and resistance 10.20-10.30.
Corn corrected late last week as prices pulled back for October option expiration and funds sold in anticipation of harvest ramping up in the coming weeks. News is pretty slow, but it’s a good sign from a technical standpoint that corn has moved back above key moving averages this morning. The outlook for the next few weeks is unchanged with funds expected to be buyers on pull-backs, but harvest pressure is expected to be an upside limiting factor with selling expected to increase if Dec. can make a run at the 4.20 area.
Beans saw a choppy, sideways trade last week, but are hitting their highest level since Sep. 6th this morning as a move above key moving averages and concerns about dryness in Brazil are driving some buying. Rains are likely to pick up in Brazil as they enter their rainy season, but with speculative funds still short an historically large amount of beans, pull-backs are expected to find buyers. Longer-term, beans still have the weakest fundamentals with corn and wheat expected to outperform
Corn up 5-7
Beans up 13-15