Early Call On CBOT

The overnight markets closed lower with wheat down around 12c, corn 5-6c lower and soybeans mostly around 2 easier.

Crude is sharply lower and the dollar a bit firmer. European stocks markets are all easier with the Dow expected to follow suit this afternoon with a lower opening.

Profit-taking after the recent rally is likely to be a feature this week ahead of Friday's USDA reports.

Funds increased their corn longs by around 24,000 lots to almost 300,000 last week. It remains to be seen if they are willing to push things even higher ahead of Friday, although early overnight trade did indeed see front month corn set a fresh 15 month high before profit-taking kicked in.

Reports of disappointing corn yields in the south may not be reflective of crop conditions further north, a few analysts are warning. Most however seem wildly bullish about corn's prospects of breaking through USD5/bu., in the wake of what they are convinced will be yields of 160 bu/acre at best this season.

Rains have reached many parts of Ukraine, and some parts of Russia, but recent comments that the latter may still plant a similar 18 million hectares of winter grains to last season seem wildly optimistic.

Crops in Southern and Eastern Australia look in great shape and should produce a bumper harvest, although things don't look anywhere near as promising in Western Australia, which usually accounts for 38-40% of the nation's wheat output, and most of it's exports too.

Brazil is very hot and dry and needs rains to arrive before soybean planting can begin once the September 16th planting window is opened. Dryness in Argentina is also a concern.

The USDA have announced the sale of 40,000 MT of soyoil to China, 21,000 MT to Peru and 29,500 MT to "unknown", all for new crop 2010/11.

Early calls for this afternoon's CBOT session: beans down 1-2c, corn down 5-6c, wheat down 10-12c.