Grains and Oilseeds:
December corn (CBOT:CZ13) closed at $4.83 per bushel, up 1 1/2c on light shortcovering and for the week posted a gain of 2.6%. Drought concerns prompted the shortcovering. We could see further price gains but with the prospect of rains moving into the area, some profittaking could be forthcoming. We prefer the sidelines. December wheat (CBOT:WZ13) closed at $6.54 ½ per bushel up 1/4c but the International Grain Council increase of its forecast for world wheat production of up 0.6% from its month ago could prompt selling early in the week. We prefer the sidelines. November soybeans closed at $13.56 ½ per bushel, down 12c after recent strength on increased possibility for beneficial rains. We continue to favor the long side of soybeans through the additional purchase of calls.
October cattle closed at $1.2680 per pound, down 17 points on lack of packer demand. We prefer the sidelines. October hogs closed at 87.60c per pound, up 27.5 points tied to demand and seasonal increase in hog slaughter to meet demand. We prefer the sidelines here as well for now. The recent price range remains stable in these markets.
Coffee, Cocoa and Sugar:
December coffee (NYBOT:KCZ13) closed at $1.1640, down 1.25c on lack of fresh fundamentals. Brazilian coffee producers’ plans to move coffee into its support programs in order to garner higher prices as reduced offers. We could see some shortcovering after the recent sharp price decline since any attempt to shore up prices seems ill fated for now. High stocks a deterrent to higher prices.Stay out. December cocoa closed Friday at $2,424 per tonne, down $55 tied to rains in West Africa and improving conditions. We continue to favor the sidelines in cocoa. October sugar closed at 16.33c per pound, down 4 ticks tied mostly to the strong dollar. The weak Brazilian Real could lead to additional offers of sugar. Stay out.
October cotton (NYBOT:CTV13) closed at 83.88c per pound, up 28 points on light shortcovering in front of the three day holiday. After the recent ten cent collapse in prices we could see a technical bottom forming for those chart watchers as well as weather conditions. For now the trend remains negative but buying a few calls here could prove profitable.