Chicago Agriculture Commodities Finished Lower on the Week

Chicago Agriculture Commodities Finished Lower on the Week

$CORN, $WEAT, $SOYB

Chicago Board of Trade (CBOT) grains futures closed lower on the week which ended 20 October, despite of a better-than-expected weekly US export report.

The most active Corn contract for December delivery fell 8.25 cents weekly, or 2.39%, to 3.445 bu.

December Wheat delivery dropped 13.50 cents, or 3.07%, to 4.26 bu.

November Soybean went down 21.5 cents, or 2.15%, to 9.7875 bu.

CBOT Corn settled the week lower on growing US harvest pressures on reports of better yields. The improved weather condition in the Midwest has enabled US farmers to go back to fields for harvest, which had been delayed by rainfalls.

The cool temperatures of late July and August helped produce better-than-expected Corn yields. Many agriculture analysts now predict that the US Department of Agriculture (USDA) may raise US Corn yield in its November report.

CBOT wheat futures closed lower as world prices retreated on larger Black Sea exports in September and October, with already plentiful inventories in world market.

A highly notable event reported here last week should be the closure of the US Wheat Associates (USW) office in Cairo, Egypt, the largest Wheat importer in the world.

The USW office has announced to cease its operation on 1 December, after some 40 years in Egypt as US Wheat has been facing fierce competition from other producers, especially those in the Black Sea area.

USW President Vince Peterson admitted that they need to adjust activities in the Middle East and North Africa, where the supply of much lower priced wheat from Russia significantly increased and gained more and more market shares.

Although a weekly export sales report released last Thursday morning showed that US exporters overall sold larger-than-expected amount of Wheat for the week ending 12 October, the Bullish news failed to sustained the Wheat prices following a brief rally.

After testing Key resistance at 10.00 in the prior week, the Soybean market turned lower on gradually building harvest pressure. US Soybean supplies are still huge while export demand remains strong, especially from Chinese importers.

Analysts expect that China will remain a strong buyer of US Soybean into early Y 2018.

In addition, the late week rally in the USD offered resistance to commodity prices.

Analysts maintain that higher prices lie ahead into Q-4 this year with funds likely to position Long commodities with the spread between stock valuations and the commodities at a record high.

Have a terrific week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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