THE OPEN:

Nov beans:  3 3/4 lower

Dec meal:  1.10 lower

Dec soyoil:  2 higher

Dec corn:    7 lower

Sep wheat:  6 3/4 lower

A combination of slightly improved forecasts and technical selling sent prices to new lows for the recent move down (which actually started Monday night), triggering sell-stops along the way.  Funds were net sellers around the board, with small buy soy/sell grain trade.  Funds entered the day long an estimated 138K corn and 40K wheat against a net short in the soy complex.    The soy complex values recovered during the session as shorts also elected to cover in part of those positions as well.  

SOY

Beans, meal, and soyoil were lower today, but it was soyoil futures that showed the most weakness being affiliated with a still lower energy market.  Crude at new lows of $54.85/barrel sent Dec soyoil through the 28c price level, which triggered a quick move down to new chart lows of 2787c.   

Meal prices were mostly steady as prices once again neared the trading range low at $310.00.  Funds were net sellers of meal into commercial pricing activity, making today an exchange of ownership. Sep crush helped meal to maintain a steady course with margins recovering to 98c/bu, while oilshare broke 31% again to trade down to 30.92%.  

Meal spreads narrowed into $4.40 from $4.60, with August/Nov beans narrowing into 17 1/2c from 18c.   Later in the session the soy complex turned mixed on a combination of bottom-picking and short-covering activity which caused beans, meal, and soyoil to enter into two-sided trade.  

GRAINS

A slightly better weather picture and bearish chart formations combined to exact a bit of housecleaning in the grain markets today.  Funds were net sellers of corn and wheat, which triggered sell-stops and took prices to the lower end of trading ranges.  Pressure was noted all day as sell-stops were triggered under recent lows, namely Dec corn at $4.30.  

Sep wheat prices took out key support at $5.00 where initial stabilization came to the fore, but later violated a key low at $4.95 triggering more stops.  The price action today continued to set the stage for a very bearish day of trade as grains remained on the defensive into noontime.  Corn spreads are weaker with Dec/March trading out to 8 1/4c from 7 1/4c.  Sep wheat/corn traded from 73 1/4c to 67 1/2c.  

AT 12;00 THE MARKETS ARE AS FOLLOWS:

                                                             HI                          LO

Nov beans:  up 3/4                               9.03 1/2                 8.93

Dec meal:  .20 lower                            314.40                   311.60

Dec soyoil:  4 lower                              2829                      2787

Dec corn:    7 lower                              4.41                       4.28

Sep wheat:  9 lower                             5.05 1/4                 4.93 1/4

Nov canola:  .30 higher                        445.60                   441.60

OUTSIDE MARKETS

The Dow opened down and has stayed down.  Crude oil was down until the Iranians seized a tanker, but there was nothing to buoy the US dollar and gold prices are off as well trading to 1419.50/oz.  Feels like a total risk off day across the board.

CLOSING COMMENTS

The current toppy patterns in each market, (corn, wheat, and beans), is exacting its toll as prices trade lower.  It is raining on LaSalle street, and it's always difficult to trade higher when it rains in Chicago.  Not a valid reason for the price fallout, but perhaps a simplistic one at best.  

Weather forecasts are slightly improved, with the August forecast looking at normal temperatures as well.   Negative attitudes are prevailing despite the challenges of the season.  Perhaps at this point, the markets have to trade low enough given poor demand for corn, beans, and soyoil to make sense to have a rallying point when the more acre specific August 12 report arrives.  

While we have broken lines of support that have come into play, we may not settle under key neckline areas of support that would suggest a larger sell-off is coming.  One has to be careful at chart bottoms, as the trends are still sideways, and reversal tops that are true head and shoulders are not yet confirmed.  If short, would probably be covering in something at these lows on a scale down basis, reserving the rest in case we settle under key levels of support, namely $4.20 Dec corn, $8.90 Nov beans, and $4.85 Sep wheat.  

And have to say that the soy complex trade, though weak, was fairly impressive in that beans were able to trade higher on the day, suggesting that at $9.00 November, there is value.

Have a good evening.......

 

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