US Agriculture (Grains) Market Report
Wheat Market Recap
Mar Wheat finished down 14 at 611.50, 20.25 off the high and + 4 from the low.
Jul Wheat closed down 11.75 at 642.25. This was + 8.25 p from the low and 16.75 off the high.
Mar Wheat rose early in the session but closed sharply lower on the day as a negative tone to the export outlook and ideas that the weekend moisture could help the production outlook into Y 2012 helped to pressure.
A weaker tone to the USD and strength in the stock market plus further talk that the market is oversold basis the COT reports helped to support the market early today with the morning rally coming up just short of last week's and Friday's highs. But, outside market forces failed to show much follow-through after the early support and Gold, Energy markets and most agricultural markets closed weak.
Mar KC Wheat saw some early strength to push the market to the highest level since November 17th before trading as much as 0.16 lower on the day.
Thoughts that US exporters will have a tough time in competing on the World market helped to pressure the market.
The Commitments of Traders (COT) reports as of November 29th showed Non-Commercial traders were net Short 53,522 contracts, a decrease of 4,228 contracts for the week and the Short-covering trend is seen as a short-term positive force.
Saudi Arabia bought 330,000 tons of Wheat in their weekend tender.
Weekly export inspections came in at 14.49-M bu which was below trade expectations and compares with 19.1-M necessary each week to reach the USDA projection for the year.
March Oats closed down 8 at 307. This was 3/4 up from the low and 13 1/2 off the high.
Corn Market Recap
Mar Corn finished down 4.25 at 591, 11.75 off the high and + 1.50 from the low.
May Corn closed down 3.75 at 599.25. This was + 1.50 from the low and 11.25 off the high.
Mar Corn closed lower for the 3rd session running, and pushed down to the lowest level since November 25th.
The market saw some Short-covering and new buying from speculators early Monday with the help of supportive news from outside market forces.
Strong gains in Energy and Equity markets, a weaker USD, and further strength in the Wheat market helped to support. In addition, a dry trend for parts of South America this week helped to provide some support too.
But, too much lower quality Wheat for the Australia harvest has helped increase the supply of feed wheat on the World market and this was seen as a factor to help limit the advance.
More confirmation from a private forecaster that China's Corn crop this year was much higher than expected by the USDA added to the negative tone.
Weekly export inspections came in at 38.5-M bu which was higher than trade expectations and compares with 34.4-M necessary each week to reach the USDA projection for the year.
Cumulative shipments have reached just 32.3% of the forecast for the marketing year compared with 37.2% as the 5-yr average for this time of the year.
Traders view the current Corn crops in South America in good condition, but dryness in parts of Argentina and Southern Brazil for the last 50% of November plus a relative dry forecast over the next week has traders concerned with the possibility of stress into the pollination period into mid-December.
Thoughts that Argentina will approve additional Corn for export from the 2010/11 season added to the negative tone late in the day.
Jan Rice finished down 0.07 at 14.385, 0.015 off the high and 0.045 up from the low.
Soybean Complex Market Recap
Jan Soybean finished down 9.50 at 1126.25, 22.25 off the high and + 4.25 from the low.
Mar Soybean closed down 9.75 at 1136.50. This was + 4 from the low and 22.25 off the high.
Jan Soymeal closed down 5.3 at 283.0. This was + 0.6 from the low and 7.5 off the high.
Jan Soybean Oil finished up 0.04 at 50.29, 0.55 off the high and + 0.28 from the low. closed sharply lower on the day with an outside-day down.
A Bullish tilt to outside market forces, a weaker USD, and hopes for a resolution soon for the EuroZone debt crisis helped to support the market early in the day.
There is talk that parts of South America are getting too dry and this helped push Soybeans to the highest level since November 23rd.
A rally in Palm Oil due to too much rain in Malaysia plus higher energy prices supported a rally in Jan Soybean Oil to a new high for the move.
A strong recovery in the USD, weakness in Energy prices, a drop in Gold prices and significant fund selling in a wide range of agricultural markets helped to pressure.
Soymeal was lower early in the session and a weak export report plus weakness in wheat helped to spark the selling pressures into the mid-session and Jan Soymeal closed near the lowest close since August of 2010.
Thoughts that Soybean and Soybean Oil were showing an oversold condition basis the weekend Commitment-of-Traders (COT) report helped to support the market early on ideas of Short-covering.
Weekly export inspections came in at just 31.6-M bu which is below trade expectations and compares with 22.8-M necessary each week to reach the USDA projection for the year. Cumulative shipments have reached just 32.3% of the forecast for the marketing year compared with 37.2% as the 5-yr average for this time of the year. Cumulative shipments have reached just 428.3-M bu, down 35.6% from last year's pace.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.