Written Commentary
SOYBEANS
The bean market is extending last week’s strong rally on hopes of continued China buying after the trade agreement, and from bullish technicals following the weekly chart gap higher to 15-month highs. However, the agreement has weakened Brazil bean prices. Over the weekend, China bought 10 cargoes of Brazil beans for December delivery and 10 for March delivery, at prices below US levels. China bought 430,000 tonnes of US beans last week, equivalent to about seven cargoes, but continued steady buying is needed if they’re going to reach the 12 million tonne purchase amount reportedly agreed to by the end of January.
SOYBEAN MEAL
December soybean meal rallied $52 per ton over the past 14 sessions, which is the largest advance over that limited timeframe in 2 years. The move has driven the market to its most overbought technical reading since December 2022, according to the daily chart. A short-term correction now looks likely, especially as South American meal values have weakened. At the same time, US prices have surged, effectively closing the export window for US meal and shifting near-term export interest toward soybean oil instead. Despite the potential for a pullback, the longer-term technical structure turned decisively bullish last week.
CORN
The corn market closed last week with slight gains, hitting its highest level since July 3. While it did not show the kind of technical strength that beans did, the bulls still have the edge. The USDA announced it will release updated agriculture supply and demand data on November 14. The US harvest is estimated at 85% complete compared to a 75% average, and dry weather this week is expected to allow harvest to wrap up quickly.
WHEAT
The wheat market is extending its rally from last week on reports that China was inquiring about purchasing US wheat over the weekend for December-February shipment. China has not bought US wheat since October of last year, and sources suggest it is looking to buy 200,000 to 400,000 tonnes. While not a huge amount in the big picture, it is a significant shift in their recent buying patterns. The China news comes on the heels of a gap higher on the weekly chart last week and a monthly reversal to the upside, shifting the longer-term technicals into a more positive mode and suggesting the long downtrend since summer may have come to an end.
CATTLE
The cattle complex saw significant volatility on Friday, with prices selling off sharply mid-session before a mild rebound toward the close. At the close of last week, the monthly chart showed significant bearish reversals in both live cattle and feeders, despite ongoing tight cattle supplies. The cash feeder index hit its lowest in 2 1/2 months. December live cattle may be better supported than the deferred months, as the government’s herd-rebuild plans are more likely to impact the deferred months.
HOGS
On Friday, December hogs finally took out the previous day’s high for only the 2nd time in the last 13 sessions, and prices closed modestly higher. Although the market has not formed a classic bullish technical formation on the daily chart, it held 200-day moving average support all of last week. In addition, downside momentum appears to be weakening, raising the odds that the bears are losing their edge. A correction rally may be ready to start if prices can generate some upside action early this week.
MILK CLASS III
December Class III milk finished last Friday with a mild weekly loss after reaching a 4-week high on Wednesday.
ENERGIES
December Crude Oil is near unchanged overnight after running into resistance at the 50-day moving average. The Baker Hughes rig count on Friday showed US oil rigs in operation were down 6 rigs to 414 last week, the lowest since September 2021. This was down from 479 rigs a year ago and below the five-year average of 452. OPEC+ agreed to lift its quota by a modest 137,000 barrels per day in December (as expected) and then to pause the output hikes for the first quarter of 2026.
December Natural Gas extended its rally overnight and reached its highest level since July 23. The weather forecast in the lower 48 states has turned a bit more seasonal, especially in the 6-10 day. The forecast is still mild, but the bulls are encouraged by the trend higher in US LNG exports and trend lower in US production.
DOLLAR INDEX
The USD index nears a three-month high to start the week ahead of private economic data that could shed some light on the health of the US economy and offer clues into the Fed’s move in December. A number of Fed officials have spoken publicly about their disinterest in a December rate cut.
COCOA
December Cocoa was higher overnight as it attempted a second leg up from the October 13 lows. The market is also drawing support from some private analysts’ reports that have turned less optimistic towards the main crop production this year. Ivory Coast port arrivals totaled 90,000 metric tons for the week ended November 2, up from 82,000 the previous week and 80,000 a year ago.
COFFEE
December Coffee extended last week’s rally overnight and traded to its highest level since October 24, which was the day after the market put in a contract high. A report from Reuters last week saying that US roasters are “plowing through their stockpiles” of coffee presented even more urgency that the US and Brazil find a way to get the 50% on Brazilian imports into the US lifted.
COTTON
December Cotton started out higher overnight but gave back its gains and was lower on the day later in the session. The market’s inability to push through last week’s one-month high at 66.10 was a disappointment for the bulls and likely encouraged some profit taking. Last week there were apparently rumors of the US selling some cotton to China following the conclusion of the meeting between President Trump and Chinese President Xi, but there has been no follow through announcement.
SUGAR
March Sugar traded right up to the nine-day moving average overnight but backed off from that level. The market fell to a new contract low last week in the wake of somewhat bearish UNICA report, which showed Brazilian Center-South Sugar production for the first half of October was slightly above expectations. However, the market bounced on Friday as perhaps the 15% decline in three weeks was too much.
PRECIOUS METALS
Gold prices rose despite a firmer dollar as markets await ISM PMI and ADP private nonfarm payroll data for clues on the Fed’s path in December as the US government shutdown continues on, preventing the release of official government data.
Silver prices moved higher, with December US futures trading around $48.35 as markets await ADP jobs and ISM PMI reports for clues on how the Fed will move in December.
Copper prices in the US rose, while benchmark copper at the LME was little changed at $10,887. Worries about shortages pushed it to a record high of $11,200 last week alongside easing US-China trade tensions.
EQUITIES
The S&P and Nasdaq moved higher, while the Dow was little changed as the markets kicked off November following a strong rally in October that saw the S&P 500 rise 2.3%, the Dow 2.5%, and the Nasdaq 4.7% for its seventh consecutive month of gains. Market attention this week will center around ISM PMI survey data and ADP private nonfarm payroll figures for any clues on whether the Fed will cut rates next month due to the absence of official government data. Markets will be looking for signs of weakness in the labor market and subsiding inflationary pressures, which could increase speculation that the Fed will cut rates at its December meeting.
INTEREST RATES
The curve steepened, with the 10-year yield holding above 4.1% as markets await private economic data that could further shape expectations of what the Fed will do come December. ADP employment and ISM PMI data this week will help provide a partial update on the economy with the release of official government figures still on hold. Several Fed officials have voiced their concerns with cutting rates in December.
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