THE OPEN

Jan beans:  1/4 lower

Jan meal:  .40 lower

Jan soyoil:  25 higher

March corn:  1 lower

March wheat:  2 higher

The markets opened as called with grains firmer against beans and meal.  Wheat prices are firmer as they were well bid before the open and are continuing to rally into the session.  Buy soyoil/sell meal trade pushed oilshare higher, which followed a very strong palm oil market.  Today was mostly about December option expirations, and a continuation of December contracts being rolled forward into first notice day next Friday.  

SOY

• The soy complex opened on a mixed note, with more selling in beans and meal as soyoil prices put in a quietly higher trade.  
• March oilshare moved back over 34% to 34.07%, while crush values were a steady 1.01c/bu trade.   
• Jan soyoil remained well bid within a trading range from 31c-3150c, not giving back much value.  
• Jan beans found net selling activity as traders continued to buy corn/sell beans.  The commitment-of-trader's report will be interesting now, as funds may have gone short from long this week.  
• Jan meal weakness traded into major support at $301.00 where good commercial pricing interest was noted.  
• Spreads were still relatively wide with Jan/March trading out to 14 1/4c from 13 3/4c.  Dec/March meal narrowed into $4.40 from $4.80, and carries as wide as $5.80 in recent weeks.  
• Later in the session Jan meal prices broke below key support of $301.00, triggering sell-stops and a move down towards lower key support at $300.00.  Jan beans followed along, trading into further weakness on buy corn and wheat/sell bean trade.  

GRAINS

• Grains moved higher but the leading market action came from wheat.  A reduced Australian crop continued to feed into firmer trade with the quality of the Argentine crop also reported to be lower with only 6% of the crop in excellent condition compared to 9% a week ago, and 35% a year ago.  
• Buy wheat/sell corn continued with the March spread moving from 1.34 1/2c up to 1.40c.  
• The strike in Canada and concerns about lower production in Australia continued to support wheat, but technical support on the charts were certainly the over-riding factor for higher trade.  March wheat firmed off the 200-day moving average at $5.09, and over recent tops as more buy-stops were triggered.   
• Corn spreads continued firmer with Dec/Mach trading into 10 1/4c from 10 1/2c as the spread continues with heavy volumes.  
• Dec/March wheat moved into 2 1/2c from 3 1/4c.   Buy Chicago and KC/sell Minneapolis spread trade continues, with prices for Minn. heading into steeply oversold relative strength index levels, suggesting that house-cleaning would be due sooner rather than later for this market.  
• Large short positions in corn and sideways charts continued to support corn prices during the session, with basis levels still very strong.  As corn prices firmed, more active hedging was reported.  

AT MIDDAY THE MARKETS ARE AS FOLLOWS:

                                                        hi                                 lo

Jan beans:  1 1/2 lower              9.03 1/2                         8.98 1/4

Jan meal:  1.80 lower                 303.60                           300.80

Jan soyoil:  26 higher                3125                                3082

March corn:  1/2 higher             3.80 1/2                            3.77 3/4

March wheat:  7 higher              5.20 1/2                          5.11 1/4

Jan canola:  .40 higher              465.20                           461.90

OUTSIDE MARKETS

The Dow opened 40 pts higher but is up 70 pts at midday.  Crude breaks to $57.89/barrel, as prices largely remain trapped between $50-$60/barrel.  The US dollar firms to 98.18.  

CLOSING COMMENTS

Funds continue to profit-take on recent positions with a shortened week next week.  Markets will close on Thursday, with shortened sessions book-ending trade Wed/Friday.  Corn is trying to rally but finds little incentive other than to follow wheat around.  

All of the markets are attempting to put in harvest lows.  The markets might be close, but if funds go short around the board, except for soyoil, then it will take a fundamental shock to turn things around.  That means a deal comes sooner rather than later, (skeptical on that one), or the January final sets a temporary low.  Into the January final, if funds want to go short then we could be looking at target lows slightly lower than where we are right now, which includes $3.65 March corn, $8.80 Jan beans, and $295.00 Jan meal.  Only one thing is clear, the path lower could be choppy and halting at best.   Still looking for that key reversal, island bottom, triple lows, (which so far have not held a break), or some other signal that suggests the slide is over.  If short, would probably be covering partial positions on the way down, as the Dec. 15 date of trade tariffs is right around the corner.  

 

TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America