Futures Commentary and Analysis

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Funds Near Record Short in Corn
Paul Georgy - IF - Tue Nov 14, 7:18AM CST
Good Morning! From Allendale, Inc. with the early morning commentary for November 14, 2017.

Grain markets respond to an almost complete US harvest and CFTC Commitments of Traders data which showed funds continuing to increase their short position in corn. Outside markets look to economic reports this morning, and the continuing headlines out of Washington on tax reform.

Commitments of Traders report data was released yesterday due to the observance of Veterans Day on Friday. The report showed funds were sellers of 2,861 corn contracts through Tuesday, November 7th. This left them net short 205,624 contracts, nearing the record short of 229,176. In soybeans, they were buyers of 6,126 contracts to be net long 46,738, and it wheat they were sellers of 14,210, leaving them net short 125,085 contracts.

US harvest nears completion as reported in yesterday's crop progress report. Through Sunday, corn was reported 83% complete, right inline with analyst estimates. Soybeans were reported 93% harvested, just below the 95% estimate.

Winter Wheat was reported 95% planted, inline with the analyst estimate. 54% of the crop was rated Good to Excellent. Analysts were expecting a 56% rating.

Brazil will harvest 110 million tonnes of soybeans in the 2017/18 crop year, down from 114 million tonnes in the previous year, an industry consultant said at an event on Monday. Brazil will produce 85-90 mln tonnes of corn in 2017-18, down from 100 mln tonnes previously, said Alexandre Mendona De Barros, an economist with consultancy MB Agro. (Reuters)

Export inspections for the week ending 11/09/2017 reported 2,087,458 tonnes of soybeans, 301,039 wheat, and 375,951 tonnes of corn.

November soybeans go off the board today leaving January as the front-month contract.

CME Group announced they would start Black Sea wheat and Black Sea corn futures next month. These will start trading on December 8 and be based on the S&P Global Platts prices. The wheat contract will be based on the Platts Russian Wheat 12.5% protein FOB Black Sea Deep Water daily price. The corn contract will be based on the Platts Ukranian Corn FOB Black Sea price.

Managed Money Funds were estimated sellers of 7,000 corn contracts, 9,500 soybeans, 6,000 wheat, 4,000 soymeal, and 5,000 soyoil in yesterday's trade.

Outside markets will monitor this morning's PPI and Core PPI reports at 7:30 CT this morning.

Cattle showlist numbers were 7,700 head lower yesterday despite talks that last weeks sales were light, leaving trade to expect a slightly higher showlist.

Funds were buyers of 11,576 contracts of Live Cattle through last Tuesday. That put them long 132,032, nearing the record long position of 145,394. In hogs they were buyers of 10,314 to be long 78,206. Funds have bought cattle for nine weeks in a row now. The past two strong buying weeks were the largest since November 22 of last year.

Dressed beef values were lower with choice down 1.04 and select down .68. The CME Feeder Index is 160.00. Pork cutout value is down .53.

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