11-10 End of Day: The slide continues for corn and wheat, while beans recover in choppy trade.
All prices as of 2:00 pm Central Time
| Corn | ||
| DEC ’23 | 464 | -4 |
| MAR ’24 | 479 | -3.75 |
| DEC ’24 | 506.75 | -2.5 |
| Soybeans | ||
| JAN ’24 | 1347.5 | 4 |
| MAR ’24 | 1360.75 | 3.25 |
| NOV ’24 | 1279.75 | -3 |
| Chicago Wheat | ||
| DEC ’23 | 575.25 | -5.5 |
| MAR ’24 | 599.25 | -7 |
| JUL ’24 | 628.75 | -7.5 |
| K.C. Wheat | ||
| DEC ’23 | 640 | -7.25 |
| MAR ’24 | 650.75 | -7.5 |
| JUL ’24 | 663.75 | -8.25 |
| Mpls Wheat | ||
| DEC ’23 | 730.5 | -4 |
| MAR ’24 | 742.5 | -6 |
| SEP ’24 | 768.5 | -5.5 |
| S&P 500 | ||
| DEC ’23 | 4423.5 | 61.25 |
| Crude Oil | ||
| JAN ’24 | 77.12 | 1.37 |
| Gold | ||
| JAN ’24 | 1949.9 | -30.4 |
Grain Market Highlights
- Following yesterday’s bearish USDA report and with the lack of fresh bullish news, traders likely added to existing short positions today, pushing the December contract to its lowest close since September 2021.
- After trading on both sides of unchanged and within a penny of yesterday’s low, buying entered the market with support from higher soybean oil and a similar turnaround in meal to help January soybeans close within 2 ¼ cents of the high.
- Support from higher crude oil and lower than expected Malaysian palm oil stocks helped bean oil recover from its recent lows and support soybeans. Solid underlying export demand for US soybean meal (due to low Argentine supplies) continues to underpin nearby meal futures, which closed just 50 cents lower on the day but firmer versus the deferred contracts.
- Despite global wheat stocks falling for the fourth year in a row and the lowest stocks to use ratio amongst the world’s major wheat exporters, all three wheat classes continued their slide following yesterday’s USDA report, as global wheat prices appear more affected by Russia’s ability to deliver cheap wheat.
- To see the US 5-day precipitation forecast, the 6 – 10 day Temperature and Precipitation Outlooks, and the Brazil and Argentina 2-week precipitation forecasts, courtesy of NOAA, NWS, and the CPC, scroll down to other Charts/Weather Section.
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Corn
Action Plan: Corn
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No Action
Corn Action Plan Summary
- No new action is recommended for 2023 corn. Since the beginning of August, the corn market has traded sideways largely between 470 and 500. October’s brief breakout to 509 ½ and the subsequent failure to stay above the 50-day moving average indicates there is significant resistance in that price range. The failure of November’s USDA report to provide a bullish influence on the market puts the market at risk of drifting sideways to lower without a bullish catalyst. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. So, for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.
- No new action is recommended for 2024 corn. Since late February ’22, Dec ’24 has been bound by 489 ¾ on the bottom and 600 on the top. After testing 491 to 547 last July, it has mostly traded between 500 and 525. During this time, Dec ’24 has held up better as bear spreading has allowed Dec ’24 to maintain more of its value versus Dec ’23 as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Moving forward, the risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 call options ahead of the summer rally and having those in place helped provide confidence to pull the trigger on recommending 2023 sales into that sharp rally, knowing that if corn kept rallying and went to 700 or 800 that the call options would protect those sold bushels.
- No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following corn recommendations:
Market Notes: Corn
- Corn futures pushed to a new nearby low on Friday and additional selling pressure fueled by hedge pressure and lack of overall bullish news weighed on the market. December corn futures lost 4 cents and was down 13 ¼ cents on the week. December corn closed at its lowest level since September of 2021.
- Hedge pressure stays a major influence on corn prices as the last 20% of harvest gets complete. Talk of producers handling extra supplies is likely pressuring the market as the corn crop is trending larger than expected in certain areas.
- Thursday’s Crop Production report and corn yield increase of 1.9 bushels/acre reflects the strong end to the harvest this fall. The increase in demand by the USDA was questioned by market analysts as the USDA added 50 mb to export demand, 25 mb to ethanol demand, and 50 mb to feed usage. The new export target for the marketing year is 2.075 billion bushels, a 400+ mb increase over last year. The large supply picture limits any near-term rallies.
- The USDA data on Thursday showed that global stocks/use is expected to reach 12.5%, matching a 4-year high. Globally, stocks/use ratios of major corn exporters could reach a 6-year high, fueled by record large Brazil and US corn harvests this past growing season. The large supplies will limit price gains due to strong global competition.
- South American weather stays in focus. Current weather models lean toward warm and dry conditions continuing into the end of the year. Forecasts for Brazil and Argentina will likely be the main driver of corn and soybean markets over the next few months.
Above: On November 3, the December contract posted a bullish key reversal with a low of 468. The 50-day moving average is just above the market at 484, and the market is oversold. If prices can push over 484, they may move higher to test 500 – 509 ½. If not, support below the market rests between 468 and 460.
Soybeans
Action Plan: Soybeans
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No Action
Soybeans Action Plan Summary
- No new action is recommended for 2023 soybeans. At the end of August, the soybean market turned lower and didn’t find any significant buying interest until it traded down to 1251 in early October. Since then, the nearby contract has traded through nearby resistance and the 50-day moving average and may be poised to test the August high. Looking back, since last May, nearby soybeans have been in a range from 1435 up top to 1251 down below. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.
- No action is recommended for the 2024 crop. Since the inception of the Nov ’24 contract, it has traded at a discount to the 2023 crop, from as much as 142 back in July, to as little as 17 ¾ in early October during harvest. And while the spread difference between the two crops has seen a good amount of volatility, Nov ’24 has been largely rangebound between 1250 and 1320 since it rallied off its 1116 ¼ low last July. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.
- No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
To date, Grain Market Insider has issued the following soybean recommendations:
Market Notes: Soybeans
- Soybeans ended the day higher after yesterday’s selloff following the USDA report and this morning’s lower open from the overnight session. Soybean meal ended slightly lower but remains near its contract highs. Soybean oil ended higher with support from crude oil and palm oil.
- The USDA increased the national soybean yield slightly to 49.9 bpa from 49.6 bpa which caused a negative reaction because estimates called for yields to be unchanged, but it was not a large adjustment and increased ending stocks only slightly to a still tight 245 mb.
- South American soybean production was updated in yesterday’s report with Argentina’s 22/23 production unchanged at 25 mmt, but Brazil’s increased to 158 mmt from 156 mmt. For 23/24, Argentina’s production estimate was unchanged at 48 mmt, but Brazil’s was increased to 163 mmt despite the hot and dry planting conditions that are persisting due to El Nino.
- While there were no reported flash sales today, flash sales yesterday were reported totaling 1,044,000 mt of soybeans to China for 23/24, and 662,500 mt were reported for delivery to unknown destinations. Export demand has picked up in this window where Brazil is planting soybeans.
Above: With the market showing signs of being overbought and after rejecting fresh market highs on November 7 and 8, it is at risk of further price erosion unless more bullish input is received. Heavy resistance rests just above the market between 1385 and 1410, while initial support remains below the market between 1334 and the 50-day moving average, and again down near 1300.
Wheat
Market Notes: Wheat
- Today wheat failed to recover, posting a negative close on follow through from yesterday’s WASDE report. At one point in this session, there was a small amount of green on the board but not enough friendly news to keep wheat in positive territory. Traders are likely focused on the fact that Russia’s crop was revised higher and that they continue to dominate the export market.
- The USDA also raised Ukraine’s exports yesterday. And though they remain below year ago levels, it remains clear that Ukraine continues to do everything in their power to ship grain. Despite a Russian missile said to having hit a merchant ship in the Black Sea earlier this week, there are still said to be about 30 vessels in Ukraine ports waiting to load out.
- On a bullish note, despite some of the negativity yesterday, global wheat ending stocks (excluding China) at 4.58 bb are the lowest in 15 years. Managed funds also remain short a sizeable amount of wheat, so any spark in the form of friendly news could ignite a fire under the wheat market and force them to cover that short position.
- One piece of news hindering the wheat market today was that a French vessel loaded with 35,000 mt of wheat is headed for New York. US imports of wheat are expected to rise, according to the USDA, to 145 mb – the highest level in six years. With US wheat exports struggling and imports rising, some friendly news will be needed to help futures break out of the sideways to lower pattern.
- Yesterday Fed Chairman Powell made comments that seemed to contrast with those after the last FOMC meeting. He now seemed to indicate that the Federal Reserve may in fact remain aggressive with interest rate increases to help curb inflation. This may keep the equity markets volatile for the time being. At the time of writing, the Dow is up over 300 points, taking back yesterday’s losses and more. This uncertainty may spill over into the grain complex as well.
Action Plan: Chicago Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No Action
Chicago Wheat Action Plan Summary
- No new action is currently recommended for 2023 Chicago wheat. After making a high in late July, the Dec ’23 contract trended lower until finding support at 540 on September 29, from which it rallied back, briefly piercing 600 and the 50-day moving average. The market now appears to be finding value in the 540 – 616 range established since early September, as weak US export demand, driven by cheap Russian exports, remains the dominant headwind to higher prices. Grain Market Insider made sales recommendations in the late June rally around 720 and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 625 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.
- No new action is recommended for 2024 Chicago wheat. The July ’24 contract has been trading at a premium to the Dec ’23 contract since late April, which has steadily increased to about 55 cents, September 29, it traded as far out as 71 ¾ cents. Fund positioning and weak fundamentals have driven Dec ’23 closer to the mid to upper 500 range, and July ’24 to the low to mid 600s. The market risk for July ’24 remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels, and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.
- No action is currently recommended for 2025 Chicago Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following Chicago wheat recommendations:
Above: December wheat rejected the bearish reversal from November 7 and traded sharply higher. It is now in range to test the October high of 604 ½ and possibly resistance near 618. If the market turns back lower, support below the market, may be found between 564 and 554.
Action Plan: KC Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No Action
KC Wheat Action Plan Summary
- No new action is recommended for 2023 KC wheat crop. Since late July the Dec ’23 contract has been in a downtrend that has had periods of relative stability, but not any significant reversals higher. The market once again found nearby support as it traded to, and held, its recent low of 625 ½. Currently, weak US export demand, driven by cheap Russian exports, remains the dominant headwind, and the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst enters the market to push prices above 700, it may signal that a fall low is in place and would line up with the historical tendency for prices to appreciate into winter and early spring. Grain Market Insider’s strategy is to look for price appreciation going into this winter, as weather becomes a more prominent market mover with an eye on considering additional sales near 750 – 800. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.
- No new action is recommended for 2024 KC wheat. The July ’24 contract is currently trading near a 25-cent premium to July ’23, which is up significantly from last July’s 60-cent discount. Weak fundamentals have driven spread activity to push July ’23 toward its contract lows, while July ’24 has been able to maintain more of its value. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed impetus to move prices back toward 750 – 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.
- No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year from now. It will probably be mid-winter before Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following KC recommendations:
Above: Since breaking through the bottom of the consolidation range at 655, the market has drifted lower and tested minor support which has held so far with the low at 625 ½. The next level of major support below that remains near 575. Major resistance above the market remains around 690 – 700.
Action Plan: Mpls Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No Action
Mpls Wheat Action Plan Summary
- No new action is currently recommended for the 2023 New Crop. After making highs in July, and the subsequent downtrend to the October 2 low of 707 ½, the Dec ‘23 contract has traded mostly sideways with no significant reversal higher. With weak US export demand still the primary impediment to higher prices, the market remains at risk of trending lower if September’s low close of 709 is violated to the downside unless another bullish impetus enters the scene. If that happens and prices begin to push back toward 775, it may signal that a near-term low is in place. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices. Even though the primary strategy is to look for higher prices, Grain Market Insider may also consider a “plan b” in the next couple of weeks if prices grind sideways to lower.
- No new action is currently recommended for 2024 Minneapolis wheat. In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a 50-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains off its low from last May. The risk for the Sep ’24 contract is much like that of Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July KC 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.
- No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following Minneapolis wheat recommendations:
Above: On November 7 the December contract posted a bearish reversal, which may indicate lower prices ahead unless bullish information enters the market to turn prices higher. Currently, upside resistance now lies between 735 and 755, with initial support below the market near 703. The next major level of support is near 669, the May ’21 low.
Other Charts / Weather
US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.
Brazil 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.
Argentina 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.