THE OPEN

Nov beans:  1 lower

Dec meal:  1.20 lower

Dec soyoil:  20 higher

Dec corn:  2 higher

Sep. wheat:  1 lower

The markets opened as expected with corn prices seeing a round of short-covering off the AM announcements of biz to China.  First notice day is Friday for August futures, as we hit the delivery period. Outside markets influenced price action with the Dow falling over 400 pts as bad economic numbers rolled in.  December soyoil futures had a large break given its connection to crude, which broke the $40/barrel level during the early going as Covid fallout persists.  

SOY

• The soy complex opened as called with soybeans trading higher on good new crop export sales. However, it was noted that open interest dropped in beans yesterday, which implied that funds were liquidating part of their overall length on the back of good growing weather.  

 

• December soyoil futures were headed higher for the early part of the session, but succumbed to nervous profit-taking as energies traded into the red.  Still, December soyoil futures traded back below 30c to test major support at 2980c and then higher proving it is a resilient market. 

 

• December meal prices also traded lower into decent commercial pricing activity.  Sep. oilshare traded back to 34.0% while crush traded higher to 83.68c/bu. 

 

• As we head into first notice day, the Aug/Nov inverse relaxed off its 11c high once more, trading down to 3c.  Currently there are no bean receipts registered for delivery. 

 

GRAINS

 

• Corn and wheat prices were mixed.  

 

• The out-of-the box trade was higher corn as shorts took profits via the large sales announcement to China this AM.  The rally took prices only so far, as key resistance for Dec. corn moved down to $3.33.  December corn end-users increased purchases as prices traded towards the key support benchmark level at $3.25.  Sep corn inched towards the April contract low of $3.15, which also saw some short-covering and better commercial pricing activity.  Overall, the pace of buying in corn was not great, with volumes mostly saved for spread trade. 

 

• Sep/Dec corn traded out to 11c from 10 1/4c, while Sep/Dec wheat traded from 5 1/2c to 6 1/4c. 

 

• Technically, Sep. wheat continues to bounce around between its moving averages, but any failed attempt to trade beyond $5.36 could create another leg lower. 

 

• Dec corn remains inherently weak, as selling continues to enter on market rallies despite the sales announcement to China. 

AT 12:00 THE MARKETS ARE AS FOLLOWS:

                                                hi                             lo

Nov beans:  1 higher           8.89                          8.80 3/4

Dec meal:  .80 higher          297.00                      293.90

Dec soyoil:  4 higher           3041                         2983

Dec corn:  1/2 higher          3.29 1/2                    3.26 1/4

Sep wheat:  1 lower            5.34 1/2                    5.25

Nov canola:  .30 higher      493.70                      488.80

OUTSIDE MARKETS

The stock market was off 300 pts in early trade but losses accelerated during the session as economic numbers continued to show that the economy is struggling to recover.  After trading nearly 400 pts lower, losses are cut in half down 240 pts.    The GDP contracted at an annual rate of 32.9% in Q2, as reported by the US Bureau of Economic Analysis. 

CLOSING COMMENTS

Seasonally prices are in a time-frame where prices weaken in corn and beans.  Trading ranges are ratcheting a bit lower as ideal weather continues to stir trade chatter about record crops.  Rain makes grain, and so far crop production is promising.  

Would note that the soy complex bends but does not break.  That is showing that prices are content to remain in today's ranges.  Corn prices have yet to find a bottom, and charts point lower.   Would also note that good pricings are increasing in corn as prices trend lower.  Could stick with a corn short in Dec. unless prices close over $3.33.  Could stick with a Nov. bean long unless prices close under $8.80.  Sep wheat is strictly sideways but would note that prices remain well bid around $5.30.  If short, the ability to stick with congestion around $3.30 is more suggestive of higher trade than lower.  December soyoil continues to hold good breaks.  Could continue to own the soy complex against corn, until the technicals suggest otherwise.  On macro weakness today, the hold of values for beans, meal, and soyoil is constructive.

Have a good evening......

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