Markets

MORNING GRAINS COMMENTS Jack Scoville

WHEAT

General Comments: Futures closed mostly a little lower Friday on forecasts for some beneficial precipitation in the central and southern Great Plains. The rains were seen Friday and early Saturday, then hot and dry weather returned. Positive export demand news is coming back to the US as the US price is finally getting competitive with Russia and other origins. Saudi Arabia was a buyer of Wheat over the weekend from many origins, but not Russia or eastern Europe on quality issues. Wheat finding its way into feed rations in an increasing way. The current Corn weather and the prices imply that these trends will continue, although Corn weather has improved a lot this week. Weather forecasts for dry and warm weather in Texas and Oklahoma continue, and more rain will be needed soon for planting of the Fall crops. Meanwhile, there has been plenty of rain lately in the Northern Great Plains and Northern Midwest, but not much in Wheat areas of the southern Midwest. Crops in the Northern Plains and into Canada should be in mostly good condition, and showers remain in the forecasts in both areas. Charts show that the trends are turning mixed or even up after the price action last week.

Overnight News: Mostly dry conditions are expected in the southern Great Plains, but northern areas could see light precipitation. Temperatures should average above to much above normal in the south, but near normal in the north. The Canadian Prairies should get periods of light showers. Temperatures will average near normal. Gulf basis levels are steady for Soft Red Winter Wheat and steady for Hard Red Winter Wheat. Saudi Arabia bought 660,000 tons of Wheat from Australia, the EU, Canada, and the US over the weekend.

Chart Analysis: Trends in Chicago are mixed. Support is at 690, 677, and 670 September, with resistance at 723, 729, and 732 September. Trends in Kansas City are up with objectives of 840 and 852 September. Support is at 789, 762, and 760 September, with resistance at 812, 823, and 832 September. Trends in Minneapolis are mixed to up with objectives of 886 September. Support is at 840, 836, and 829 September, and resistance is at 875, 894, and 898 September.

Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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WHEAT - CHICAGO BOARD OF TRADE (CONTRACTS OF 5,000 BUSHELS)

CFTC Code #001602 Open Interest is 534,448

: Positions

: 54,342 173,293 183,169 10,292 36,621 60,834 73,514 56,046 13,422 31,019 87,548

: Changes from: August 2, 2011

: 4,292 -4,857 -8,573 1,116 698 -377 414 -872 842 -82 1,522

: Percent of Open Interest Represented by Each Category of Trader

: 10.2 32.4 34.3 1.9 6.9 11.4 13.8 10.5 2.5 5.8 16.4

: Number of Traders in Each Category Total Traders: 417

: 76 98 20 6 25 55 68 63 68 77 121

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Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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WHEAT - KANSAS CITY BOARD OF TRADE (CONTRACTS OF 5,000 BUSHELS)

CFTC Code #001612 Open Interest is 179,951

: Positions

: 36,932 104,036 30,682 522 1,442 43,805 9,287 17,893 12,769 4,934 12,707

: Changes from: August 2, 2011

: 6,383 3,513 -655 0 -3,149 -876 982 -2,476 459 -121 -61

: Percent of Open Interest Represented by Each Category of Trader

: 20.5 57.8 17.1 0.3 0.8 24.3 5.2 9.9 7.1 2.7 7.1

: Number of Traders in Each Category Total Traders: 182

: 53 65 14 . 8 33 15 27 27 13 31

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Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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WHEAT - MINNEAPOLIS GRAIN EXCHANGE (CONTRACTS OF 5,000 BUSHELS)

CFTC Code #001626 Open Interest is 55,176

: Positions

: 21,448 31,700 1,259 0 397 8,512 971 3,577 3,046 801 4,789

: Changes from: August 2, 2011

: -494 -2,077 -433 0 69 -180 -259 -121 -994 55 457

: Percent of Open Interest Represented by Each Category of Trader

: 38.9 57.5 2.3 0.0 0.7 15.4 1.8 6.5 5.5 1.5 8.7

: Number of Traders in Each Category Total Traders: 70

: 31 23 5 0 . 9 4 9 10 5 12

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RICE

General Comments: Prices were a little lower Friday after a choppy session as USDA on Thursday morning showed slightly higher production and higher ending stocks for the year. Export demand was cut, especially for the short grain Rice. The combined effect was to hurt the bull case, so the bulls were not such active buyers. The market remains very concerned about the quality and yields potential for the Rice crop here this year. The weather has started to moderate in the Mid South, but the region is still not getting a lot of rain. It is seeing some showers and the situation there is showing some improvement. Texas and Louisiana are actively in harvest activities now, with good yields being reported in many parts of both states. No milling yield reports have been heard yet. Field yields are expected to go down for later planted Rice in these states. Cash markets are reported to be steady in Arkansas as mills try to buy the last of the good quality old crop supplies. New crop bids have also been steady. Cash markets in Texas appear steady to firm. Price action since late last week implies that the market knows it has big crop losses to contend with here in the US. Trends are generally up on the charts.

Overnight News: Some showers are possible in Mid South and Delta areas off and on this week. Temperatures will average above normal. Philippines now expects to produce 17.29 million tons of Rice this year, a record production but slightly lower than previous forecasts.

Chart Analysis: Trends are mixed. Support is at 1657, 1644, and 1628 September, and resistance is at 1702, 1710, and 1719 September.

Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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ROUGH RICE - CHICAGO BOARD OF TRADE (CONTRACTS OF 200,000 POUNDS)

CFTC Code #039601 Open Interest is 19,377

: Positions

: 4,037 12,616 3,293 174 8 2,779 565 518 1,484 1,633 2,674

: Changes from: August 2, 2011

: 50 -450 -267 33 0 -267 0 20 47 88 547

: Percent of Open Interest Represented by Each Category of Trader

: 20.8 65.1 17.0 0.9 0.0 14.3 2.9 2.7 7.7 8.4 13.8

: Number of Traders in Each Category Total Traders: 90

: 16 17 8 . . 17 . . 19 15 20

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CORN AND OATS

General Comments: Corn and Oats were higher Friday as traders reacted to the USDA reports released Thursday morning that showed less than expected production and ending stocks. It is not so much that traders had expected that the crop could be that small, it is more that they did not expect USDA to make that call this early in the season. Corn losses are certain this year from the hot and dry weather seen in July, but no one is sure just how big the losses will be. Forecasts call for near normal temperatures and some beneficial precipitation for most areas over the next week or two to help keep yields from falling further. Better weather now would help improve yield potential, but some losses are still expected. Oats are being harvested, so warmer and drier weather will enhance progress. However, condition ratings are still down.

Overnight News: Basis was steady at the Gulf of Mexico.

Chart Analysis: Trends in Corn are mixed. Support is at 693, 688, and 684 September, and resistance is at 708, 714, and 721 September. Trends in Oats are mixed. Support is at 340, 335, and 331 September, and resistance is at 347, 350, and 356 September.

Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

--------------------------------------------------------------------------------------------------------------

CORN - CHICAGO BOARD OF TRADE (CONTRACTS OF 5,000 BUSHELS)

CFTC Code #002602 Open Interest is 1,894,620

: Positions

: 317,272 745,001 278,712 49,558 148,328 286,798 25,957 205,817 81,946 48,121 389,091

: Changes from: August 2, 2011

: 8,642 -8,634 -12,121 1,769 -4,336 -10,182 -897 6,675 -4,471 -9,715 21,082

: Percent of Open Interest Represented by Each Category of Trader

: 16.7 39.3 14.7 2.6 7.8 15.1 1.4 10.9 4.3 2.5 20.5

: Number of Traders in Each Category Total Traders: 874

: 256 384 14 15 28 124 29 84 116 145 206

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Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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OATS - CHICAGO BOARD OF TRADE (CONTRACTS OF 5,000 BUSHELS)

CFTC Code #004603 Open Interest is 14,768

: Positions

: 5,334 10,129 2,213 0 4 2,242 848 0 525 254 1,837

: Changes from: August 2, 2011

: 694 -3 165 0 3 -178 160 0 12 70 237

: Percent of Open Interest Represented by Each Category of Trader

: 36.1 68.6 15.0 0.0 0.0 15.2 5.7 0.0 3.6 1.7 12.4

: Number of Traders in Each Category Total Traders: 43

: 10 12 6 0 . 8 4 0 7 4 6

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Disaggregated Commitments of Traders- Options and Futures Combined Positions as of August 9, 2011

: Reportable Positions

:-------------------------------------------------------------------------------------------------------------

: Producer/Merchant : : :

: Processor/User : Swap Dealers : Managed Money : Other Reportables

: Long : Short : Long : Short :Spreading: Long : Short :Spreading: Long : Short :Spreading

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CBT ETHANOL - CHICAGO BOARD OF TRADE (CONTRACTS OF 29,000 U.S. GALLONS)

CFTC Code #025601 Open Interest is 9,438

: Positions

: 7,206 6,552 34 1,003 256 623 0 12 467 967 233

: Changes from: August 2, 2011

: -322 -130 1 75 -4 34 0 7 73 -134 52

: Percent of Open Interest Represented by Each Category of Trader

: 76.4 69.4 0.4 10.6 2.7 6.6 0.0 0.1 4.9 10.2 2.5

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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