Markets are pulling back overnight with beans and wheat adding to their losses that we saw to start the week while corn is retracing part of the gains that it saw to start the week following better than expected bean and wheat ratings on yesterday’s crop progress report.

Managed funds to start the week were estimated as net buyers of 10k corn to reduce the net short to 195k, net sellers of 1k beans to push the net short out to 15k, and net sellers of 3k wheat to push the net short to 60k.

Crop progress showed corn rated 74% g/e (74 expected), beans rated 70% g/e (67 expected), and spring wheat rated 54% (50 expected).

China and Australia said they had signed multiple cooperation agreements on Tuesday covering trade, customs inspections, quarantine and agriculture.

December corn posted a lower low, higher high, and close above the previous day’s high, posting a bullish key reversal to start the week. The market is oversold with plenty of room to trade higher as that condition corrects. Support for Dec. is 4.10 and resistance 4.18.

Beans posted a lower low, lower high, and lower close to start the week as that market was not able to reverse to finish higher. The market is oversold with potential to consolidate/trade sideways as it corrects that condition. Support is 10.00 and resistance 10.20-10.30.

Corn sent a strong signal on Monday that the market may have found a near-term low with prices hitting new lows and then reversing to close above the highs from report day on Friday. The market is retracing some of those gains this morning as crop prospects remain very good, but buyers are expected to emerge on the weakness as a lot of bearishness has been priced in. Be patient with bearish positions for now.

Beans are leaking lower again this morning as managed funds appear to be starting to build a more aggressive speculative short position, which is something they had been slow to do. Ratings are good and weather is wet, which is limiting buying interest. Producers can look at option strategies to protect downside risk.

Corn down 3-4

Beans down1-2