Ag Markets Get Subdued Start to Week

CHICAGO - Oct 9/06 - SNS -- Markets opened the week overshadowed by news North Korea tested a nuclear bomb over the weekend, which contributed to an quick, upward spike in gold and oil values amid speculation of more intense economic sanctions on a country which is already completely isolated economically and politically.

Friday's Commitment of Traders report with options shows the wheat market in a classic bullish setup with non-commercial traders (trend following funds) net long 22,744 contracts and non-reportable traders net short more than 33,000 contracts. Funds shifted from a net short to a net long position, and the buying trend (bought a net 23,292 contracts in just one week) of the funds is a short term bullish force, argue analysts with the Chicago Board of Trade (CBOT).

For corn, the Commitment of Traders report shows the market in a classic bullish setup with non-commercial traders (trend following funds) net long 203,274 contracts and non-reportable traders net short nearly 123,000 contracts, CBOT analysts said. Funds were net buyers of nearly 25,000 contracts for the week, which is also a short-term positive force, and the fund net long position is still near 68,000 contracts short of the record.

In the case of soybeans, the report shows the market in an oversold condition with speculators net short 83,209 contracts. Non-commercial traders (trend following funds) reduced their hefty net short position by near 1,300 contracts for the week ending October 3rd, and the buying trend is a short-term positive force. The oversold condition leaves the market vulnerable to continued short covering if resistance levels are violated, CBOT analysts said.

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