Corn Finds Bargain Buyers

Corn – GTE falls 2% to 67%, 5 year ave is 62%, funds silent yesterday, may find bargain buyers

↑ A GTE decline of 2% may cause some bargain buyers to step in with light support like in overnight

↔ The July crop report has only lowered yields 3 times in the last 20 years so it is best to say a yield change on the next report is unlikely which may keep it as a fairly calm report

↔ Funds were active sellers through last Tuesday of 86K, then short 81% of record, if we factor in potential fund selling on Friday’s report they may be closer to 85% - 90% record shorts as of today

↓ Morning 1 – 5 day has solid rains, 6 – 10 day lighter rains, temps below average in 15 day outlook

Beans – GTE unchanged 67%, 5 year ave is 60%, bean oil finding support due to fund positions

↔ GTE was left unchanged at 67% which is still a fair amount over the 5 year average

↑ Bean oil found aggressive speculative buying yesterday after seeing that funds were 99% of record shorts in bean oil, some of the support may have been fund short covering themselves

↔ There have been long range forecasts calling for heat to move in for July/August but so far the 15 day outlook shows temperatures below average, this will be a factor to watch going forward

↑ Yesterday’s low in Nov reached 1097 but more active buying should be expected around 1100 and should also see better general support at any level under 1100

Wheat – Overnight easing yesterday’s gains but trade may be looking for a 3rd strong export week

↓ Overnight is easing back some of yesterday's gains, overseas wheat has been recovering in general

↔ HRW harvest moved from 41% to now 54%, typically it would be a bit early to expect hedge pressure to start easing but with the recent aggressive selling we may see it start to ease this week

↑ The last 2 weeks have shown export improvement, trade may expect a 3rd improved week on Friday

Cattle – Average cash trade -0.02 at 190.53, BB still moving higher, showlist +8300

↔ Yesterday’s PM BB was choice +2.86 Select +1.91 packer BE at 201.80, packer cushion $11.27

↑ BB continues to move higher making new highs for the recent move, CH + SEL is at 635.59, the all time high set last year has CH + SEL at 654

↑ Packer profits at $11.27 is strong enough to assume a higher cash trade even with a +8300 showlist

↔ Futures are currently priced $3 under last week’s cash, very highly cautious trade so far this week

↔ Technically, cattle does have a need for a correction but BB is not suggesting that just yet