Chicago Close

30/08/11 -- Soybeans: Sep 11 Soybeans closed at USD14.48 3/4, up 10 3/4 cents; Nov 12 Soybeans closed at USD13.79 3/4, up 8 3/4 cents; Sep 11 Soybean Meal closed at USD381.10, up USD1.90; Sep 11 Soybean Oil closed at 58.20, up 20 points. The entire market is almost universally bullish, which makes me suspicious. Funds bought 8,000 bean contracts on the day it is estimated, adding to recently established length. What happens if/when they get fed up/spooked by supporting the market at these levels? At the end of the day soybeans at USD14/bu aren't cheap. Don't get me wrong, I readily accept all the bullish arguments that are out there in the marketplace but the notion that there is virtually no downside potential is worrisome.

Corn: Sep 11 Corn closed at USD7.63 1/2, up 7 1/4 cents; Dec 11 Corn closed at USD7.75 1/4, up 5 1/4 cents. Despite trading lower overnight corn quickly turned positive, aided by fund money buying a further 9,000 contracts on the day. One widely quoted weather forecaster appears to be predicting an early frost this year, which grabbed media attention, despite saying that the guy concerned has issued a frost scare at least four times since 2000 and none of them have so far materialised. Meanwhile, report US corn exports falling to an eight-year low this season.

Wheat: Sep 11 CBOT Wheat closed at USD7.50 1/4, down 7 cents; Sep 11 KCBT Wheat closed at USD8.67 1/2, down 6 1/2 cents; Sep 11 MGEX Wheat closed at USD9.41, down 7 1/4 cents. Private exporters announced the sale of 102,500 MT of HRW wheat to unknown, but apart from that bullish news was limited. Yemen bought Black Sea wheat over the weekend and Western Australia looks set for a wheat crop of around double last season's drought damaged output. Spillover support from corn helped wheat from falling too far however. Oklahoma and Kansas are forecast to get some rain this weekend ahead of winter wheat plantings.