Early Market Talk December 3, 2019

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Firm start to Tuesday trade in part helped by roughly 1.5 bln bu of corn remaining unharvested? Seasonal expectations with large net Fund short in corn and technical picture also contributing.

At 0600 CH20 trading 1 ½¢ higher at $3.83 ½ with SF20 up 3 ½¢ at $8.74. Typical overnight vol on these two of 10 and 14K contracts. KC and Chi wheat 6 and 4¢ higher as well.

Dow futures off 111 pts this morning on the heels of sharp losses yesterday. Crude a scratch lower at $55.95. US $ Index in the red this morning. Continuing drought in Australia the narrative on wheat strength.

Corn harvest 89% up 5% on the week. North Dakota remains significantly below their 5-year pace with only 36% harvested up 6% on the week.

Unharvested corn in ND equals near 300 mln bu. Updated CFTC trade data shows Funds covering more of their short position in corn than expected. As of this morning we have them net short 111K corn and 63K soybeans.

Yesterday looked at a chart showing historical Fund positions. Noted every time they were net short 100K contracts or more, within a few months they were net long at least 100K. Pattern to repeat? Will send the same chart with price action attached shortly.

Soybean spreads trading best of year levels. Having some hedge forward prudent. CR soy basis trading -5F sounds good until equating that to -48SN.

No corn deliveries this morning. Still have 216 lots registered………..

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