General Comments: Futures closed lower after opening higher as traders reacted early in the day to less than great yields that were forecast by participants in the North Dakota Spring Wheat tour and late4r to the lack of progress in Washington. Positive demand news remains hard to find. Ideas continue that Russia is taking all the export business. USDA implied very strong demand in the coming year, with Wheat likely to find its way into feed rations in an increasing way. Weather remains a concern. The crop tour is showing less production potential for the Spring crops due to the wet weather that has hurt planting and development. It estimated North Dakota yields at 41.5 bushels per acre, from 46.0 bushels per acre last year. Weather forecasts for dry and warm weather in Texas and Oklahoma continue. Charts show that the trends are trying to turn up.
Overnight News: Mostly dry conditions are expected in the southern Great Plains, but northern areas could see light precipitation. Temperatures should average above to much above normal in the south, but near normal in the north. The Canadian Prairies should get periods of light precipitation. Temperatures will average near to below normal. Gulf basis levels are steady for Soft Red Winter Wheat and stronger for Hard Red Winter Wheat.
Chart Analysis: Trends in Chicago are mixed. Support is at 676, 672, and 670 September, with resistance at 714, 721, and 729 September. Trends in Kansas City are mixed to up with objectives of 840 September. Support is at 778, 764, and 760 September, with resistance at 800, 810, and 832 September. Trends in Minneapolis are mixed. Support is at 840, 836, and 819 September, and resistance is at 860, 872, and 894 September.
General Comments Prices were sharply lower again yesterday on what appeared to be speculative selling that appeared on the close of the trading session. There did not appear to be any news to cause the selling, although export sales released before the start of trading were poor. Rice is starting to head out in the Mid South so it needs cooler and wetter weather to produce good yields and good volume. Texas is starting to harvest now, with good initial yields being reported. The USDA reports implied that supplies will be very tight for the entire year due to the lost planted area earlier in the year, and the supplies could get even more tight if the yields come in below USDA forecasts. World prices have been a little firmer in Asia, mostly for political reasons in Thailand, but for demand reasons in Vietnam.
Overnight News: Mostly dry in the Mid South, dry along the Gulf Coast. Some showers are possible in Mid South and Delta areas the second half of the week. Temperatures will average above normal. India has stopped allocating export licenses as rains have turned patchy for now. There is talk there that its production target. Rains in July were 14% below normal.
Chart Analysis: Trends are mixed to down with objectives of 1588 and 1506 September. Support is at 1628, 1626, and 1622 September, and resistance is at 1646, 1657, and 1669 September.
CORN AND OATS
General Comments: Corn was and Oats were lower yesterday as Corn reacted to rains in northern sections of the Midwest and on the lack of progress in Washington. There have been some reports of yield loss surfacing in recent days but most farmers appear optimistic about pollination during the recent hot weather. Traders are now starting to wonder just how good yields can be, and a Reuters survey of analysts found a range between 153 and 158 bushels per acre. Weather forecasts this week continue to offer hopes for improved growing conditions in the Midwest, with near to above normal temperatures in at least the northern half of the Corn Belt and some rains. Hot conditions should remain in the south, and it should be drier. The southern growing areas could continue to see conditions deteriorate. Oats are entering harvest, so warmer and drier weather will enhance progress. Very hot weather moved through the Midwest last week, and the high night time temperatures probably caused some yield loss. However, temperatures are forecast to cool down this week and there was a lot of rain over the weekend, and this might help keep losses to a minimum. The losses might not be seen until the Corn is more developed as current reports indicate that the crops have good color and look fine in many areas. Basis levels are mostly weaker at the Gulf. Trends are mixed for the short term.
Overnight News: Basis was steady at the Gulf of Mexico.
Chart Analysis: Trends in Corn are mixed. Support is at 679, 676, and 671 September, and resistance is at 691, 698, and 714 September. Trends in Oats are mixed. Support is at 346, 340, and 333 September, and resistance is at 355, 366, and 368 September.
SOYBEANS AND PRODUCTS
General Comments: Soybeans and products were lower after poor export sales and as little movement were seen in Washington. Wetter weather in the northern Midwest aided in crop development but no in strong prices. Weather forecasts still offer hopes for improved growing conditions in the Midwest with temperatures closer to normal in the north, but still hot in the south, and some showers and storms in northern areas. Southern areas should stay stressed for the next week or so. Gulf basis levels were unchanged. Upside price potential would still appear to be more limited than that for Corn or Wheat or Rice. Ideas of strong production in South America and the potential for production and planted area here in the US to increase are negative. South America has plenty of production and has been offering, but activity there seems slow. Charts show that trends are mixed.
Overnight News: Basis levels are steady at the gulf. Gulf Soybean Meal basis is steady. Midwest basis levels were steady. China bought 220,000 tons of new crop US Soybeans.
Chart Analysis: Trends in Soybeans are mixed. Support is at 1351, 1333, and 1322 September, and resistance is at 1366, 1379, and 1386 September. Trends in Soybean Meal are mixed. Support is at 357.00, 354.00, and 349.00 September, and resistance is at 365.00, 368.00, and 370.00 September. Trends in Soybean Oil are mixed. Support is at 5560, 5530, and 5480 September, with resistance at 5700, 5740, and 5820 September.
CANOLA AND PALM OIL
General Comments: Canola was lower on what was called speculative profit taking. Cash movement by farmers was reported active as the farmers prepare for the new crop. Most crops appear to be in good condition in Canada for now, but crops got off to a very slow start and losses are possible despite better weather now. It is warm there this week and some showers are in the forecast. European conditions are good. Traders will watch weather in the US and in the Prairies this week Palm Oil was lower today in light volume trading on outside markets and end of the month trading. Traders expect the current drier weather patterns in Malaysia to slow production in coming weeks. Trends are mostly sideways for now.
Chart Analysis: Trends in Canola are mixed. Support is at 553.00, 551.00, and 545.00 November, with resistance at 560.00, 564.00, and 570.00 November. Trends in Palm Oil are mixed. Support is at 3090, 3055, and 3030 October, with resistance at 3130, 3140, and 3160 October.
Midwest Weather: Mostly dry this weekend and early next week. Temperatures will average near normal.