The Russian ruble found new lows for the recent move, and as such lowered the cost of replacement in interior markets across the country. Russian fob offers this evening are unchanged, but the market seemed to have slowed demand above $196/MT, basis spot, and so we expect both rallies and breaks to struggle into the holidays.
We also mention that managed funds as of last Tuesday were short a net 125,000 contracts, not quite a record but far more than expected. Funds are also short a net 24,000 contracts of HRW, which is getting rather close to the all-time record posted in mid-2016. The market for new short positions is lacking.
US winter wheat crop conditions as of Sunday fell to 54% GD/EX, vs. 55% a week ago and slightly below average. Detioration is noted in IL, MO, MT, SD and TX, and ARC looks for fruther erosion in GD/EX ratings into Dec amid expanding dryness across the Southern & Central Plains.
It doesn’t pay to be bearish here, but we doubt the market can fund much demand on rallies. Chart-based support rests at $4.18, basis Dec CME.
