Written Commentary
SOYBEANS
Soybeans traded higher on talk of higher demand. USDA announced another 132 mt US soybeans to China. China may need to buy additional US soybeans to satisfy total import needs. Brazil and especially Argentina is starting 2022 crop season drier than normal. Some feel dryness in Argentina may continue into December. USDA dropped US weekly soybean crop ratings from 57 pct G/E to 56 and 69 last year. Crops dropped in IL, IN, MI, MO, NE, ND and TN. Some feel Pro Farmer US soybean yield should be closer to 48 than 51 if their state data was used to calculate US yield. World canola prices continue to trend higher on talk of lower Canada and EU supplies. Dry Russia weather could also reduce their sunseed crop. SX is back near key resistance near 13.40 may need to trade above downtrend line resistance near 13.68 to attract new buying.
CORN
Corn futures traded higher. Fact GSI Commodity Index retraced most of last weeks losses led by rally in energies helped support corn. CZ ended near 5.45. Range was 5.36-5.47. CZ had an outside day closing above Mondays high. Initial resistance is near 5.52-5.54. Concern about new US export demand and approaching US harvest has pushed CZ from USDA report high near 5.94 to Mondays low near 5.29. Managed funds were net buyers of 6,000 corn contracts. Some feel these funds may no added to long position before US harvest and until US Dollar trends lower. US financial markets are waiting for news from US Central Bank on outlook for US economy and if market needs less bond buying and higher rates. Some feel spread of Delta virus could slow US economy and delay tapering. Key is also farmer selling at harvest and final yields. Some feel US farmer may delay new sales given positive financial situation and low prices. There is also talk that recent news report suggesting lowering US 2021 biofuel mandates may have overstated the possibility of lower demand. Some feel 2021 demand is on track to be above 2020 and 2022 mandates could be higher than 2021. USDA dropped weekly US corn crop rating from 62 pct G/E to 60 and 64 last year. Crops dropped in IL, IN, MN, MO, ND, NE and WI. Best crops are in KY, MI, OH and WI. Some Feel Pro Farmer US corn yield should be closer to 173 than 177 if their state data was used to calculate US yield.
WHEAT
Wheat futures were mixed. Some buying corn and selling wheat spreads may have offered resistance. WZ ended near 7.32 with range 7.24-7.37. KWZ ended near 7.18 with range 7.08-7.22. MWZ ended near 9.10 with range 8.96-9.14. US spring wheat harvest is near 77 pct done vs 55 average. Harvest is still offering resistance to basis despite lower crop. Some feel quality of the crop is better than expected. MWU is gaining on MWZ which suggest pipeline supplies may be tight. On Monday, Canada will update their 2021 crop est. Trade estimates Canada wheat crop near 22.6 mmt with range 18.9 to 25.4 and vs 35.2 last year. Lower Canada and Russia supplies could help trigger a rally in wheat futures. WZ is near 7.20 support with key resistance near 7.49. Need to trade over 7.49 to avoid a negative head and shoulder tech picture. KWZ has a similar tech picture with 7.30 key resistance. MWZ has been trading near 9.00 since July 29. Some feel nearby Chicago futures could eventually trade over 8.00 due to lower World supplies.
Chicago Dec Wheat futures contract
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