THE OPEN

November beans: 1 higher

December meal;  2.30 higher

December soyoil:  32 lower

December corn:  3/4 higher

September wheat:  6 3/4 lower

The markets opened as expected with the grains generally weaker vs. higher beans and meal.  Good weather was the main feature weighing on corn and beans.   Wheat futures became the sell-leg of inter-market spreads.  Oilshare was lower as traders bought meal/sold soyoil.

At 10:00 export inspections were released as follows:

beans:  472,680 mt vs. 454,19 mt week ago

corn:  797,487 mt vs. 1,175,910 mt week ago

wheat:  544,010 mt vs. 512,305 mt week ago

Export inspections for both corn and beans came in lower than trade expectations, adding weight to today's trade.  

SOY

• The main feature in the soy complex was that of higher meal against a weaker soyoil trade, and firm beans.  November beans continue to see good support on pullbacks with further Chinese purchases, and one from Mexico as well.  
• December soyoil goes on the defensive as palm oil sees a round of good profit-taking and crude oil works back to test $40/barrel.  Short-term oscillators are slightly oversold in soyoil, but strength continues to see selling activity.   
• The 200-day moving average in Dec. soyoil at 3055c has been the bottom of a market, and for today is the top as prices continue to break lower.  Look for good support on a pullback to 2965c should we go there and would expect it probably will.  
• Sep. oilshare trended down to 33.37% as crush traded to 77.02c/bu.  December meal charts found support on pullbacks amidst short-covering and pricing ideas.  
• December meal prices did in fact trigger buy-stops over trendline resistance at $302.00.   Meal spreads were wider trading out to $6.00 from $4.80.   
• August bean prices remain solid trading back towards recent highs at $9.10, while November congests around $9.00.    The August /Nov bean inverse remained firm with a 6 1/2c trade, while Sep/Nov was slightly weaker trading from even to 1c carry. 

GRAINS

• Wheat futures traded lower on the day as funds were short, and the covering stopped on a weaker overnight trade.  Russia's forecast for higher production was a bit of a surprise, with estimates raised 1.5 mmt to 78.0 mmt.  
• More precipitation and milder temperatures were bearish for both corn and wheat.  Technically Sep. wheat remains in a broad trading range from $5.00-$5.50, rotating around $5.35.  
• December corn futures spent the time post open trending weaker, as rainfall and mild temperatures assure that the crop is on its way to being made.  While traders await Chinese business via their tight domestic supply, it is not enough to trump a good weather outcome.  
• Volumes remain very good for spread trade, with Sep/Dec corn widening out to new lows at 9 1/4c.  The Sep. wheat/corn trades from 2.10 1/2c down to 2.03 1/2c as wheat succumbs to lower prices.    

AT 12:00 THE MARKETS ARE AS FOLLOWS:

                                                               HI                     LO

November beans:  1 higher               9.03 3/4            8.95

December meal:  3.20 higher            303.50              297.00

December soyoil:  31 lower              3053                 2991

December corn:  1 1/2 lower            3.36 1/2            3.32 1/2

September wheat:  9 lower               5.39                 5.20 1/4

November canola:  steady                489.50             486.70

OUTSIDE MARKETS 

Stocks are up 38 pts., but the feature of the day was that of gold futures which surged to a record high of $1938/oz.     Selling the US dollar and buying gold is now an active trade given further stimulus.    The prospect of another large trillion plus US aid package is promoting a further sell-off in the US dollar which trades down to 83.47.   At midday, stocks are higher, up 137 pts.

CLOSING COMMENTS

First notice day for August futures is Friday.  If long, time to get out. 

Mostly negative attitudes remain in play as funds remain short corn and wheat.  Good weather should find ratings steady, though some are calling for a small decline.  Weather this week should take care of lower ratings, as the only dry spot in the US will be more or less limited to portions of Iowa.  Western Iowa in particular remains very dry.  

Look for prices to remain range-bound as we enter the make or break month of August for beans.  Over the next two weeks there is not a lot of weather to worry about, so it seems.  Look for trading ranges to continue:

Nov beans:  $8.80-$9.10

Dec meal:  $290.00-$308.00

Dec soyoil:  2950-31c

Dec corn:  $3.30-$3.40

Sep. wheat:  $5.15-$5.50

Beans could continue to take a leg upward if biz announcements continue which may keep Dec. corn well supported at $3.30.  A break to the 100-day moving in Sep. wheat at $5.23 should hold as well. Would continue to find places to own beans and even soyoil, despite the weaker trade from the latter today. 

 

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