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Corn futures have gone nowhere the past couple of weeks as the bears seem reluctant to aggressively press the market, while the bulls have been burned on too many occasions in picking a bottom. News for the most part is scarce. Harvest has begun in the Southeast with some exceptional yields being reported. Last week, the crop ratings rose one point to 73 percent in good-to-excellent condition, the best rating since 1994. Many traders anticipate the national yield will range from 170-176 bpa versus USDA’s estimate of 167.4 bpa. Ag Watch currently projects a yield of 169.9 bpa. There are a few concerns of an early frost, but that is the norm for this time of the season. Export inspections were 42.9 MB last week with the cumulative total standing at 1.808 BB, below USDA’s target of 1.920 BB. Currently, the trend following funds are long a token 5 MB.
Soybeans have seen a tough time recently, taking one step forward, then two back. News is mostly bearish with the expectations for a record crop and increased plantings in South America this fall. Currently, seventy percent of the crop is rated in good-to-excellent condition, down one point from a week ago. However, this is a stellar rating for this for this time of the season. Ninety percent of the crop is setting pods, slightly ahead of the average of 89 percent. No frost is in the long-term forecast giving the bull little hope. Meanwhile, yield reports of early harvested soybeans in the Southeast are exceptional. Exports for the marketing year are winding down with inspections last week at 5.3 MB. Cumulative shipments are 1.593 BB and are short of USDA’s projection of 1.640 BB. The trend following funds are becoming more bearish as they have increased their short position 25 MB to 270 MB. For now, the bears are in staunch control, and the bulls may have to wait until planting begins in South America before a bottom develops.
Wheat has been hanging tough the past few weeks because of quality issues in Europe. Furthermore, reports are circulating that more than 1,000 Russian troops have moved into Ukraine. Sounds like Putin is testing the water for further aggression. So far, there have been no disruption of exports in that region. Export inspections last week were 20.5 MB and above the average needed to reach USDA’s projection of 925 MB. Shipments for the season are off to a slow start, but have improved the past couple of weeks. Spring wheat harvest has begun and is 27 percent complete compared to the average of 49 percent. The trend following funds may be turning less bearish as they recently trimmed 40 MB from their short position reducing it to 345 MB.
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