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3 Big Things Today, November 6

Grains Higher, Beans Lower Overnight; Money Managers Betting Against Higher Prices.

1. Grains Slightly Higher on Short Covering Ahead of WASDE, Soybeans Modestly Lower

Grains were slightly higher overnight on technical bullishness, while soybeans were modestly lower amid favorable weather in South America.

Grain traders last week built large short positions but are likely covering some of those shorts this morning, Allendale’s Paul Georgy said in a report. Traders are likely position- squaring ahead of Thursday’s monthly Supply and Demand Report, he said.

Soybean futures declined on forecasts for rainfall in Brazil and diminishing precipitation in Argentina, which will allow growers to speed planting, Georgy said. The weather in the U.S. is also looking more favorable for harvest, he said.

Corn futures for December delivery rose 1¼¢ to $3.49½ a bushel overnight on the Chicago Board of Trade.  

Wheat for December delivery gained 2¼¢ to $4.28 a bushel in Chicago. Kansas City futures added 1¢ to $4.27¾ a bushel.

Soybean futures for January delivery fell a penny to $9.85¾ a bushel overnight in Chicago. Soy meal lost 10¢ to $313.80 a short ton, and soy oil declined 0.07¢ to 34.35¢ a pound.

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2. Money Managers More Bearish Corn, Less Bullish Beans in Week Through October 31

Money managers were more bearish on corn and less bullish on beans again last week.

Speculative investors were net short by 199,135 corn contracts in the week that ended on October 31, the Commodity Futures Trading Commission said in its weekly Commitment of Traders Report.

That’s up from 155,307 contracts the prior week, according to the CFTC.

Soybean traders were net long by 39,016 contracts last week, down from 47,234 contract seven days earlier, government data show.

Investors increased net-short positions in corn and lowered their net longs in beans as the U.S. harvest limps to completion – perhaps sometime this month – and as South American weather turns more favorable.

The soybean harvest was 83% finished as of October 29, just behind the five-year average for this time of year of 84%, according to the USDA. Corn collection, however, is still well behind the average at only 54% complete. The USDA will release its weekly Crop Progress Report today, which is expected to show growers accelerated the pace of the harvest last week, pushing soybeans to or past the normal pace.

The weekly Commitment of Traders Report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.

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3. Light Snow Expected in Parts of South Dakota, Nebraska; Minor Flooding Forecast in Indiana

Some light snow and flurries are forecast for parts of southern South Dakota and extreme northern Nebraska this morning with temperatures expected to be in the mid to high 20s, according to the National Weather Service.

Little to no accumulation is expected in the area, as temperatures climb above freezing this morning, and any precipitation farther south will be “spotty,” the NWS said in a report on Monday morning.

Farther east, some flooding is expected in parts of Indiana after heavy rain over the weekend.

A “weak” disturbance is expected to bring more showers to parts of the Tennessee Valley late tonight, while another storm system is possibly moving in later this week, the NWS said.

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