Should there be 'no worries' for wheat?

General Comments:  U.S. markets were higher as the weather in the U.S. and around the world remained less than good for crops.  The crop reports from USDA last night showed that the Spring Wheat crops continued to deteriorate.  This will be a big problem here this year, and maybe in Canada as well as crop conditions, there are less than perfect.  Trade focus will shift to the production updates on Wednesday.  The crop conditions should deteriorate more this week as the weather in the Great Plains should stay hot and dry.  The hot and dry weather extends into Canada and could be hurting yield potential there as well.  Reports from the region suggest that the situation is getting worse and not better.  Canada has less area planted to Spring Wheat this year, and some of these crops have been hurt by warm and dry weather as well.  The Winter Wheat harvest continues and there is the talk of mixed yields and quality.  There are still a lot of problems for Wheat crops in Europe and into the former USSR from hot and dry weather seen earlier in the growing season.  Provincial reports from Canada suggest that it remains too dry in western growing areas, while eastern areas might be too wet.  Australia is reporting hot and dry weather that is hurting yield potential, and some reports now suggest the crop there could be less than 20 million tons, from estimates well above 22 million at the start of the year.

Overnight News:  The southern Great Plains should get dry weather.  Temperatures should be above normal.  Northern areas should get mostly dry weather.  Temperatures should be above normal.  The Canadian Prairies should see mostly dry weather.  Temperatures will average above normal. 

Chart Analysis: Trends in Chicago are mixed to up with no objectives.  Support is at 546, 537, and 530 September, with resistance at 556, 560, and 574 September.  Trends in Kansas City are mixed to up with no objectives.  Support is at 552, 541, and 537 September, with resistance at 569, 577, and 579 September.  Trends in Minneapolis are mixed to up with no objectives.  Support is at 792, 774, and 755 September, and resistance is at 828, 840, and 852 September.

General Comments:   Corn was higher in the reaction for the hot and dry weather to hit the western Corn Belt this week and also on forecasts for Eastern áreas to stay too wet.  Both áreas need a change in these forecasts to a more normal pattern of alternating sun and rain along with moderate temperatures.  Current weather forecasts continue to call for the hot and dry weather to move into the western áreas of the Corn Belt this week.  Eastern áreas should see wetter weather, and some ponding of fields is being reported again.  USDA showed lower crop condition ratings last night due to the bad weather and there is no reason to think that overall conditions will get better this week.  Some producers sold crops on the rally and there is more Corn to be moved before harvest of the next crop.  The crop remains highly variable and in various stages of development.  Pollination and maturation will be long and drawn out affairs.  Crops are also suffering in the Great Plains, where it has been dry and very hot.  Ideas are already that top yield potential is diminished, but USDA might not reflect these ideas on Wednesday if they use current planted and harvested área projections and stick with current yield estimates.   

Chart Analysis:  Trends in Corn are up with objectives of 405 and 420 September.  Support is at 396, 391, and 385 September, and resistance is at 403, 409, and 414 September.  Trends in Oats are mixed to up with objectives of 301, 318, and 324 September.   Support is at 284, 281, and 269 September, and resistance is at 294, 301, and 305 September.

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