Corn

Recap

Corn futures were lower Tuesday with the Dec contract finishing the session at a one week low of 420’6, off by 5’2 (1.23%). Overall volume was 424,933, with Dec seeing 229,659 done. Total open interest added 12,601 (0.85%), with Dec dropping by 4,096, or 0.56%, to 731,462.

Technicals
Yesterday’s pullback may have put a damper on overall sentiment, but there wasn’t much technical damage done. As outlined in yesterday’s 2- Minute Drill, 413 1/2-416 is the pivot pocket to keep an eye on through this week’s trade. From a risk/reward standpoint we see this pocket as an opportunity to look long. However, a break and close below there would neutralize that bias as it could lead to a further retracement down to the technically and psychologically significant $4.00 level. On the resistance side, the Bulls want to see consecutive closes back above 425-426 1/2. Ultimately, we continue to believe there will be a lot of great shorter term trade setups on both sides of the market with limited upside and downside here in the near term.

Technical Levels of Importance
Resistance: 433-435, 441-443
Pivot:425-426 1/2
Support: 413 1/2-416, 406 3/4 1/2-408 1/2, 397-401 1/4

Notes
Ethanol: Weekly ethanol production is expected to come in at 1.018 million barrels per day, that would be up slightly from 1.015 in the previous week. Stockpiles are expected to come in at 23.288 million, down from 23.459 in the week prior.
Ukraine – Ukraine says Russian missiles strike two Black Sea grain vessels earlier this week. It seems that there have been a growing number of these headlines recently. Deputy Prime Minister Oleksiy Kuleba stated “Russia “is attempting in this way to destroy shipping in the Black Sea guaranteeing food security. The consequences can only mean greater instability in sensitive regions dependent on food imports and tension in international relations,”.

WASDE Estimates
Yield: 183.5 VS September 183.6
Harvested Area: 82.7, Unchanged from Sep.
Production: 15.173 VS September 15.283

Soybeans

Recap

For the fifth consecutive session, Soybean futures ended lower, with the Nov contract settling Tuesday at 1016’2, down by 17’6 or 1.72%. Total volume came in at a one month high of 424,293, with Nov seeing a heavy 215,735 change hands. Across all maturities, open interest decreased by 5,118 (0.58%) to end the session with 881,933 outstanding. The Nov maturity fell 5.50%, or 5,118, to finish at 353,443.

Technicals
November soybean futures broke below trendline support yesterday which triggered an acceleration of the selling, taking prices down to the breakout point from September 23rd and the 50-day moving average, both coming in near 1011. The market has found its footing in the overnight and early morning trade, but the Bulls still have their work cut out for them to repair the damage that was done over the last week. Below yesterday’s low, 995 3/4-1001 1/4 is the pocket to watch. A failure there and a reacceleration of selling could kick in. On the resistance side, a close back above 1023-1024 1/2 would be a start for the Bulls, but they really need to see consecutive closes back above 1041 3/4-1042 to right the ship.

Technical Levels of Importance
Resistance: 1041 3/4-1042, 1069 1/2-1069 3/4
Pivot: 1023-1024 1/2
Support: 1010, 995 3/4-1001 1/4**

Notes

Flash Sale: Private exporters reported sales of 166,000 metric tons (6,099,454 bushels) of soybeans for delivery to China during the 2024/2025 marketing year.

WASDE Estimates
Yield: 53.2, Unchanged from September
Harvested Area: 86.3, Unchanged from September
Production: 4.581, VS 4.586 in September

South American Weather Update from Empire Weather LLC
Bands of rain will begin to spread into Northern Argentina and Rio Grande do Sul over the next 24 hours. By midweek, those same rain bands are forecast to expand northwards into parts of Parana and Mato Grosso do Sul. This will be the first in a series of rain events that will begin to move northwards into areas that have been much drier than normal over the past several weeks.

By Mid-October, precipitation is expected to trend slightly above normal across all of Central Brazil from Mato Grosso southwards into Rio Grande do Sul. While this pattern change will be substantial, there will still be pockets of dryness that will need to be monitored, specifically from Mato Grosso do Sul into Paraná. ECMWF is probably a bit too aggressive with rain while GFS data is a bit too dry.

With the active pattern developing and continuing into early November, temperatures will average just slightly warmer than normal across most areas. The risk for significant heat currently appears limited over the next several days as a result of clouds and rainfall.

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