WHEAT

General Comments: Futures closed sharply lower yesterday as traders reacted to the FED announcement and to news that the Chinese manufacturing index contracted for the third month in a row. The FED announcement that it would buy longer dated bonds and sell near dated notes was as expected, but after the announcement the dollar rallied sharply and stock markets went sharply lower. Fears that Russia was taking all the export business helped the bears. Ideas of tight supplies here of high quality Wheat and ideas that the hard Red Winter Wheat crop will struggle to get planted in a timely way as it still has not rained all that much in areas of the central and southern Great Plains continue. Yields and quality in Spring Wheat areas was hurt earlier in the season due to excessive rains in the north, but harvest conditions now are good. Wheat is still finding its way into feed rations as many buyers do not want to pay the high prices for Corn. The current Corn prices imply that these trends will continue. Charts show that the trends are down.

Overnight News: Mostly dry conditions are expected in the southern Great Plains. Northern areas could see mostly dry conditions. Temperatures should average near to above normal. It should be very warm this weekend. The Canadian Prairies should get mostly dry conditions, and turn very warm this weekend. Temperatures will average near normal to above normal this week and much above normal this weekend. Gulf basis levels are higher for Soft Red Winter Wheat and steady to higher for Hard Red Winter Wheat.
Chart Analysis: Trends in Chicago are down with no objectives. Support is at 632, 615, and 608 December, with resistance at 651, 662, and 667 December. Trends in Kansas City are down with no objectives. Support is at 720, 715, and 698 December, with resistance at 734, 755, and 760 December. Trends in Minneapolis are down with no objectives. Support is at 815, 802, and 784 December, and resistance is at 840, 853, and 856 December.

RICE

General Comments: Prices were sharply lower yesterday on speculative selling tied to weakness in outside markets and fears about the European situation. Futures also saw pressure from news that the Chinese manufacturing index dropped for the third month in a row. The FED announcement that it would buy longer dated bonds and sell near dated notes was as expected, but after the announcement the dollar rallied sharply and stock markets went sharply lower. Cold weather remains and issue for farmers here and is expected to return this weekend. The weather was cool last week enough to hurt Rice progress and yield potential, at least in Arkansas and Missouri, and might get cool enough again. The harvest continues to move north, although slowly. Initial yield reports are mixed in Arkansas, but overall the reports are not showing any big disasters. Milling yields have not been good as harvest progresses. US cash markets are reported to be steady in Arkansas. Cash markets in Texas and Louisiana appear weak. Futures remain above cash prices, but cash prices are starting to move a little higher as the harvest progresses and futures have fallen sharply.

Overnight News: Some showers are possible in Mid South and Delta areas late this weekend, but mostly dry. Temperatures will average below normal. Vietnam has exported 6.08 million tons of Rice so far this year, up 13% from last year.

Chart Analysis: Trends are down with objectives of 1664 November. Support is at 1640, 1630, and 1620 November, and resistance is at 1676, 1680, and 1685 November.

CORN AND OATS

General Comments: Corn and Oats closed sharply lower yesterday in reaction to the FED announcement and news from China that its manufacturing index had fallen for the third month in a row. The FED announcement that it would buy longer dated bonds and sell near dated notes was as expected, but after the announcement the dollar rallied sharply and stock markets went sharply lower. Expectations of harvest progress helped keep prices down. Some showers and cool temperatures were seen over the weekend and the precipitation could slow harvest progress. Drier conditions are expected in northern areas, and temperatures will be cold again. Some harvest has been reported in parts of iowa and Illinois, and yield reports have been very good. These crops appear to have been planted and more fully developed by the time the bad weather hit. Ideas are that yields can decline as harvest progresses. The cash market is steady, and cash market buyers have been easier to find with current prices, but demand overall does not appear that strong. Basis levels are steady in the country as the elevators prepare for the harvest.

Overnight News: Basis was steady at the Gulf of Mexico.

Chart Analysis: Trends in Corn are down with objectives of 618 December. Support is at 640, 621, and 612 December, and resistance is at 663, 666, and 669 December. Trends in Oats are down with objectives of 325 December. Support is at 334, 333, and 329 September, and resistance is at 340, 342, and 346 December.

SOYBEANS AND PRODUCTS

General Comments: Soybeans and products were lower yesterday on ideas of higher than expected yields and in reaction to the FED announcement. The FED announcement that it would buy longer dated bonds and sell near dated notes was as expected, but after the announcement the dollar rallied sharply and stock markets went sharply lower. Bears got more help when China said that its manufacturing index fell for the third month in a row. Ideas of weak demand and on the European and Greek economic issues continued to hurt price action. A cold front moved through the Midwest last week and brought frost or freezes to some of the crop in Minnesota and the Dakotas. USDA showed greater than expected condition losses in its weekly updates yesterday because of the event. More showers are likely in northern areas over the middle of the week, then it will turn cold again. Initial yield reports have been highly mixed. US processor demand is not good for now, and export demand appears soft. Basis levels are steady. Charts show that trends are mostly down for the short term.

Overnight News: Basis levels are steady at the gulf. Gulf Soybean Meal basis is steady. China bought 1126,000 tons of US Soybeans overnight.

Chart Analysis: Trends in Soybeans are down with no objectives. Support is at 1282, 1267, and 1238 November, and resistance is at 1318, 1326, and 1345 November. Trends in Soybean Meal are down with no objectives. Support is at 330.00, 328.00, and 322.00 October, and resistance is at 334.00, 337.00, and 338.00 October. Trends in Soybean Oil are down with no objectives. Support is at 5285, 5225, and 5130 October, with resistance at 5415, 5475, and 5515 October.

CANOLA AND PALM OIL

General Comments: Canola was lower along with Chicago and in reaction to the FED announcement. The FED announcement that it would buy longer dated bonds and sell near dated notes was as expected, but after the announcement the dollar rallied sharply and stock markets went sharply lower. News that the Chinese industrial index contracted for the third month in a row hurt prices too. Harvest progress continues and kept futures from moving much higher. Funds and producers were the best sellers. Exporters and processors were the best buyers. Reports of dry weather supported ideas of big harvest progress. Some selling was seen as export demand seems slow. Cash movement by farmers was reported moderate last week as the farmers are with the new crop harvest. Most crops appear to be in good condition as harvest progresses, and yields are reported to be very good. Ideas are that the crops are now past danger from freezes, which is good since there was a killing freeze in most areas last week. Harvest is ahead of normal. Palm Oil was lower today on outside markets.

Overnight News:
Chart Analysis: Trends in Canola are mixed to down with no objectives. Support is at 532.00, 530.00, and 528.00 November, with resistance at 544.00, 546.00, and 551.00 November. Trends in Palm Oil are mixed. Support is at 2980, 2960, and 2940 December, with resistance at 3025, 3040, and 3080 December.

Midwest Weather: Mostly dry. Temperatures will average below normal.

Questions? Ask Jack Scoville today at 312-264-4322

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