Corn – Still seeing light fund buying followed by normal harvest pressure, some help from wheat
↑ Overnight traders may have added some support partially as spill over support from wheat
↑ There were still signs of fund buying yesterday although this time it lasted just the first 10 minutes
↓ Any time the funds are not buying we should expect more light harvest pressure, that pressure is likely to get smaller if Dec falls under fair value at 410
↔If Friday’s report lowers carryout to our estimate at 2.000 fair value would be 420, if it is lowered to what analysts are looking for at 1.962 then fair value would be around 435 - 440
Beans – Trade likely anticipating a more sizable 8 AM sale today as China returns from holiday
↑ There is talk that larger 8 AM sales might be seen after China has returned from holiday, we would note that their holidays don’t often have a major impact on their imports
↑ Another reason to look for strong exports is the fact the US has a strong price advantage over SA right now, even with their lower shipping costs to get to China
↔Current Nov fair value is 1010 – 1020, most are expecting no carryout change on Friday
↔While SA maps don’t yet have a major impact on beans (they will soon once harvest moves beyond 75%) we will note that there are still active rains in the 10 day outlook for both BRA and ARG
Wheat – Continued dry HRW forecast, Russia has rain in the 6 – 10 day but may be too late
↑ This morning added nothing more than a sprinkle in the 10 day forecast for HRW areas
↑ Russia remains dry, trade still anticipates an lower estimate from the Russian Ag Minister this week
↑ Wheat has been on a choppy and slow grind but it has been a grind higher for 1 ½ months
Cattle – BB leveled off yesterday, trade back to highly optimistic priced $3.30 over last week’s cash
↔Yesterday’s PM BB was choice +0.91 select -0.72 packer BE at 189.06, packer cushion $2.95
↑ Trade is back to highly optimistic priced $3.30 over last week’s cash trade, while a higher trade is possible this week, a $3 higher trade seems a bit over done
↔Would expect cash bids today but would expect them to be like last week where packers bid steady and hold to that bid unless forced to pay higher late in the week
↔The packer situation has not changed, they are losing money on every head of cattle they buy so we should expect them to do what they can to avoid paying higher or to slow slaughter to lose less money