CORN:  The first report of the week came on the demand side with our Weekly Export Inspection Report showing 29.5 million bushels of corn was inspected for a near term export.  This was off slightly from a strong 40.9 the week prior and under our 4 week average of 37 m.b.  Last week's number of 40.9 was Asia loading up ahead of their major eight day holiday starting on Thursday.  It is no surprise we are slowing on demand as the holiday enters but demand will turn strong again after the holiday as they play catch up.  China's corn crop looks to be down 10 to 15% at a time they look to continue building a larger strategic corn supply, so expect them to be in at harvest time- along with Asian neighbors finding it difficult to get grain from big brother China.  Additionally, Mexico's drought and crop problems on corn look to continue while Argentina (the world's second largest world exporter) will plant 10 year low acres in favor of more beans.  This leaves Brazil to look at U.S. Ports for corn on its massive cattle feed lots as normally it would come from Argentina.  Do not be fooled... on the weekly reports as they always have soft spots.  Demand is certain to be better in the new marketing year all the way through late Spring as countries in need out of Asia continue to expand hog and chicken populating and gather larger reserves to protect their livestock base.  The Crop Condition Report on Monday showed 68% of the crop in good to excellent condition, unchanged from the week prior.  It was over a year ago of 61% and our 10 year average.  This is what has led the last several government crop reports to raise production estimates.  Not so fast...  A closer look shows only 37% of the crop is fully mature vs. 49 last year and our five year average of 72%.  Some of our key producers are even slower.  Illinois 24%, Indiana 31%, Nebraska 33% Ohio 24% and Wisconsin 20% mature.  We can look at this a lot of different ways, but the Market sees fear before fact.  The fear maybe that the colder weather patterns the last two weeks, especially the cold evenings may have corn shutting down.  If the crop is done growing or not, reaching full maturity and development, then lower production estimates may show up on the October USDA or November Crop Report.  We will watch near term to see if the Market begins to grasp this thinking.  Wednesday at 7:30a central time, the USDA releases it's Small Grains Report.  The average pre-report trade guess for our quarterly grain stocks is 1.719 b.b. up from 1.624 a year ago.  The range of guesses is 1.665 to 1.803.  If it is under the low estimate it is friendly for prices as it's amply stocks but over the high end is Bearish.  Unless there is a surprise on the report, we should expect weather to continue to be the major pricing influence.  The long awaited cold snap is here today and Wednesday.  The weather site WXRISK.COM said low 30's were seen as far south as Nebraska including North and South Dakota with minimal frost exposure.  Now Wednesday morning the frost threat is for Northern Minnesota and Wisconsin.  Again- largely out of the major growing areas.  Should the frost push deeper into Northern Iowa, Illinois and Indiana, we would have a problem and a measurable rally on prices.  After Wednesday we look to see a fair amount of rain in the Upper Plains and Western Corn Belt with generally cool to cold conditions the next eleven days.  A lot of stuff is working the Market now between weather threats and Wednesday Grain Stocks Report.  If frost damage should occur on Wednesday the pre-harvest lows are in at 3.02, but should we dodge a bullet and yield talks resume good and Wednesday's Report is Bearish, we have a chance for another leg down to test lows and possible pull under 3.00 basis December Futures.  Last October saw corn break 1.50 after the September 30th Grain Report.  We were much higher then at 5.00 but trend following funds know the seasonal.  A close under 3.18 on the week sets up 2.94 as next support.  A close over 3.56 sets a test of 3.76.

BEAN:  Monday's Weekly Export Inspection Report showed 7.4 m.b. of beans were inspected for near term export; up from a Marketing year low the week prior of 0.7 and just under a strong four week average of 9 m.b.  Key world player, China, was in for 4.4 m.b. of the total.  Near term we could see a slow down in exports as the Asian holiday begins October 1st through the 8th, but after the holiday and as harvest kicks in over the Midwest late October we expect strong demand largely from China and then surrounding Asian neighbors in dire need of protein crops.  It is going to be in importers best interest to load up on U.S. beans until South America crop production becomes clearer next February and March.  Monday's Crop Condition Report put beans at 66% in G-E condition down 1% from the week prior but well over a year ago of 57%.  Where corn maturity is at a standstill, beans are roaring forward with 63% of the crop dropping its leaves vs. 40% last week and our five year average of 77%.  Key producers read like this:  Ohio 76%, Nebraska 74%, Iowa 76%, Indiana 63% and Illinois lower at 41%.  This lends to thought that the crop will be over 80% fully mature by weeks end and avoiding longer term weather scares.  Wednesday's USDA Quarterly Stocks Report should confirm what we already know and that is stocks are tight.  The average pre-report trade guess is 111 m.b. with a range of 90 to 135.  This is why this year's production is so important.  Beans see the immediate near term just like corn.  A frost on Wednesday and the 8.85 November low will hold.  If we avoid frost and yield talk continue high and talk of a higher production number on the October Crop Report we can test the 8.85 low with 8.40 next stop.  Resistance is 9.40.  Push through here buys long as frost would have occurred in Midwest.  We prefer to see 8.40 as a near and long term buying point but weather is the deterring factor this week.  We were trading at 11.00 areas last year into September 30th Report before a sharp sell off in October.  Funds know this...

 

WHEAT:  Monday's Weekly Export Inspection Report came in at 24 m.b. inspected for near term export vs. 25.4 the week prior and four week average of 19 m.b.  Looks good on the surface but a record 743 m.b. ending stocks and world stocks fat as well leaves these numbers largely ignored by the Market.  The Market looks to any production problems for direction world wide.  Argentina's wheat crop got some badly needed rain the last 2 weeks with the winter wheat crop here now being planted sees timely rain to help early emergence with periods of dryness to keep the planting pace at the 5 year average pace.  No problems in sight.  Wednesday's Crop Report is expected to be Bearish.  The average pre-report trade guess for all wheat production is 2.196 b.b. vs. the last wheat production update in August of 2.184.  The range of guesses is 2.154 to 2.244.  Quarterly stocks are put at 2.131 b.b. on hand as of September 1st.  This compares to 1.858 b.b. a year ago.  The trade in general is very Bearish for inventory and productions, making us wonder if we are in for a friendly surprise.  A strong close under 4.50 sets up a move to the low 4.20 area.  A close over 4.80 is needed to turn chart Bullish.