4-1 End of Day: Grains Lower to Start April
All prices as of 2:00 pm Central Time
| Corn | ||
| MAY ’24 | 435.5 | -6.5 |
| JUL ’24 | 449.25 | -5.25 |
| DEC ’24 | 474.75 | -3 |
| Soybeans | ||
| MAY ’24 | 1185.75 | -5.75 |
| JUL ’24 | 1199.5 | -5.75 |
| NOV ’24 | 1182.5 | -3.75 |
| Chicago Wheat | ||
| MAY ’24 | 557 | -3.25 |
| JUL ’24 | 572.75 | -3 |
| JUL ’25 | 640.75 | 0 |
| K.C. Wheat | ||
| MAY ’24 | 575.5 | -9.75 |
| JUL ’24 | 571 | -8.75 |
| JUL ’25 | 626 | -3.25 |
| Mpls Wheat | ||
| MAY ’24 | 634.75 | -10.25 |
| JUL ’24 | 644.5 | -8.5 |
| SEP ’24 | 653.75 | -7.25 |
| S&P 500 | ||
| JUN ’24 | 5293 | -15.5 |
| Crude Oil | ||
| JUN ’24 | 82.96 | 0.54 |
| Gold | ||
| JUN ’24 | 2261.7 | 23.3 |
Grain Market Highlights
- Corn prices were lower Monday after last week’s supportive planting intentions and grain stocks numbers. Weather in Brazil continues to look non-threatening in the short term for the currently growing second crop corn.
- Soybean closed lower on Monday after very poor export inspections of just 15.2 million bushels put total inspections down 19% year over year.
- Soybean meal prices were also lower on the day while soybean oil held onto small gains given continued strength in crude oil futures.
- The US Dollar Index traded to its highest level since mid-November today putting pressure on all three wheat classes which closed lower on the day.
- To see the updated Monthly Temperature and Precipitation Outlooks courtesy of the NWS, and NOAA scroll down to the other Charts/Weather section.
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Corn
Action Plan: Corn
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Corn Action Plan Summary
From the low on February 26 to the high on March 12, May corn experienced a significant rally of nearly 40 cents. However, since then, it has consolidated within a narrow trading range, fluctuating mostly between 430 and 445. During this period, Managed Money has reduced its net short position by approximately 53,000 contracts, although it still holds a historically large short position of around 243,000 contracts. The size of Managed Money’s net short position, coupled with prevailing macro oversold conditions, suggests potential for further upside as we head into spring planting. While the recovery in corn prices may encounter obstacles, overall market conditions remain conducive to a continued price recovery into May and June.
- No new action is recommended for 2023 corn. The target range to make additional sales is 480 – 520 versus May ’24 futures. If you need to move bushels for cash or logistics reasons, consider re-owning any sold bushels with September call options.
- No new action is recommended for 2024 corn. We are targeting 520 – 560 to recommend making additional sales versus Dec ‘24 futures. For put option hedges, we are looking for 500 – 520 versus Dec ‘24 before recommending buying put options on production that cannot be forward priced prior to harvest.
- No Action is currently recommended for 2025 corn. At the beginning of the year, Dec ’25 corn futures left a gap between 502 ½ and 504 on the daily chart. Considering the tendency for markets to fill price gaps like these, we are targeting the 495 – 510 area to recommend making additional sales.
To date, Grain Market Insider has issued the following corn recommendations:
Market Notes: Corn
- Corn market saw selling pressure to start the week as the market still weighing out the recent USDA report for planting intentions and grain stocks. While overall numbers were better than expected the supply of corn in the front end and projected long term still limits the market.
- The USDA Weekly export inspections were supportive on Monday morning. Last week total corn inspections were 1.432 MMT (54.6 mb), above the high end of market expectations. Year-to-date, total inspections have reached 25.87 MMT (1.018 bb), up 34% over last year.
- Improved precipitation forecast for the corn belt are likely to Improve areas of the corn belt still reflected on the drought monitor maps. U.S. weather is looking more favorable for a potential good start to the 2024 U.S. corn crop.
- Brazil weather is still trending overall favorable for development of the second corn crop. There are no short-term issues now, but South America weather will stay as a key market driver in the weeks ahead.
- Managed money grew their short positions in the corn market last week as prices slid into the USDA Acres and Grain Stocks report. Funds are now net short 251,730 contracts on last week’s Commitment of Trader’s report. This was an increase of 8,742 net short positions.
Above: Since the beginning of March, the corn market has been trading sideways, bound mostly by 445 up top and 430 down below. If prices can close above 445, they could then test the January high of 452 ¼. If they break out to the downside and close below 421, they could slide further to test 400 – 410 support.
Soybeans
Action Plan: Soybeans
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Soybeans Action Plan Summary
The USDA gave little in the way of outright bullish information to trigger great amounts of short covering as their March 1 stocks and prospective soybean plantings estimates were relatively neutral and came in as expected by the market. That said, Managed Money still held a sizable 148,399 contract net short position in the most recent Commitment of Traders report, which can still fuel a short covering rally if issues come up this season, with planting not that far off. Otherwise, prices may still be at risk of retesting the recent lows this spring if weather stays benign and planting goes smoothly.
- No new action is recommended for 2023 soybeans. We are currently targeting a rebound to the 1275 – 1325 area versus May ’24 futures to recommend making further sales. If you need to move inventory for cash or logistics reasons, consider re-owning any sold bushels with September call options.
- No new action is recommended for the 2024 crop. Considering the amount of uncertainty that lies ahead with the 2024 soybean crop, we recommended back in December buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated production and to protect any sales in an extended rally. We are currently targeting the 1280 – 1320 range versus Nov ’24 futures, which is a modest retracement toward the 2022 highs, to recommend making additional sales.
- No Action is currently recommended for 2025 Soybeans. We currently aren’t considering any recommendations at this time for the 2025 crop that will be planted next year, 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 finished the day lower despite a higher start. Last week’ USDA report showed planting intentions and stocks within the average trade guesses, but the increase in acres was still bearish. Soybean oil had provided support earlier in the day but faded slightly to close higher while soybean meal ended the day lower.
- Today, soybean inspections were released and totaled 15.2 mb for the week ending March 28. This was lower than the lowest end of the trade range and puts total inspections at 1,359 mb which is down 19% from the previous year.
- In January, soybean oil for use in US biofuel production fell to 960 million pounds from 1,141 million pounds in December. Despite this, crush demand is strong and soybean crush is seen at 196.7 mb in February which would be up 11.2% from the previous year.
- Friday’s CFTC report showed funds as buyers of soybeans as of March 26 by 13,559 contracts leaving them net short 134,780 contracts, but it is estimated that on Thursday following the USDA report, they sold 1,500 contracts.
Above: Although May soybeans rejected a rally through the March 14 high of 1217 ½, they could still test the January high of 1247 ½ if downside support near 1175 continues to hold and if prices close above 1226 ¾. If not, the market runs the risk of retreating down toward the 1130 – 1140 support area.
Wheat
Market Notes: Wheat
- All three US wheat classes posted losses today. The US Dollar Index was also up sharply today, breaking above the 105 mark and to the highest level since mid-November. This put some pressure on the grain complex and wheat in particular, as it makes it more expensive for importing countries to buy US ag goods.
- Weekly wheat inspections at 18.3 mb bring the total 23/24 inspections now to 543 mb. That is down 12% from last year and inspections are running behind the pace to meet the USDA’s goal.
- According to the CFTC as of March 26, managed funds increased their short position in Chicago wheat by 14.3% to 92,102 contracts, from 80,570 previously. The Kansas City wheat short increased by 12.6% from 37,857 to 42,658 contracts.
- Ukraine’s grain exports have totaled 34.6 mmt since the season began on July 1. That is a 7.5% decline year on year. However, their wheat exports in particular have seen a 7.5% increase since last year at 13.7 mmt. Of that total, 1.9 mmt was shipped in March.
- Reportedly, the Indian government is mandating that traders, food processors, and retailers must report wheat stocks every Friday in April. This is in an effort to prevent hoarding; India had a previous limit on how much wheat that traders could hold, but this expired at the end of March. In addition, their government surplus of wheat is said to be the lowest since 2017 at 9.7 mmt.
- SovEcon has reported that Russia had shipped 1.02 mmt of grain last week, with 840,000 mt of that being wheat. That total is down from 1.27 mmt previously, while the previous week’s wheat shipments were at 1.27 mmt. In addition, IKAR has said that Russian wheat FOB values ended at $208 per mt last week, resulting in the third weekly increase in a row.
Action Plan: Chicago Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Chicago Wheat Action Plan Summary
Since making a fresh low in early March, Chicago wheat has traded mostly sideways with relatively small gains capped by overhead resistance. Although the lack of any bullish information has been disappointing, the market remains oversold on a macro level, and managed funds continue to hold a significant net short position. Either or both of these factors could fuel a short covering rally at any time as we head into the more active part of the growing season.
- No new action is currently recommended for 2023 Chicago wheat. Any remaining 2023 soft red winter wheat should be getting priced into market strength. Grain Market Insider won’t have any “New Alerts” for 2023 Chicago wheat – either Cash, Calls, or Puts, as we have moved focus onto 2024 and 2025 Crop Year Opportunities.
- No new action is recommended for 2024 Chicago wheat. At the end of August, we recommended purchasing July ‘24 590 puts to prepare for further price erosion, and recently recommended exiting half of those puts to lock in gains and get closer to a net neutral cost on the remaining position. For now, we are targeting a market rebound back towards 675 – 715 versus May ’24 futures before recommending any additional sales. As for the open 590 put position, we are looking for prices between 475 – 500 versus July ’24 futures to before we recommend exiting half of the remaining July ’24 590 puts.
- No new action is currently recommended for 2025 Chicago Wheat. We recently recommended initiating your first sales for the 2025 SRW crop year as prices pressed back toward the mid-600 range to take advantage of historically good prices for next year’s crop. Since plenty of time remains to market this crop, we are looking for further price appreciation and are currently targeting the 690 – 725 area to recommend making additional sales.
To date, Grain Market Insider has issued the following Chicago wheat recommendations:
Above: Chicago wheat posted a bearish reversal on March 25, indicating there is significant resistance above the market near the 50-day moving average. Prices could still challenge the 50 and 100-day moving averages, and the 585 – 620 congestion area if they rebound and close above 567. Otherwise, if they retreat and close below 523 ½, they run the risk of trading down toward the next major support level near 488.
Action Plan: KC Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
KC Wheat Action Plan Summary
Since the end of February, prices have been trading in a broad range, bound mostly by 555 on the downside and 605 up top, with little fresh bullish news to trade, while US exports continue to suffer from lower world export prices. Although, fundamentals remain weak. Managed funds continue to hold a considerable net short position, and the market is at levels not seen since spring of 2021, which combined could trigger a return to higher prices if unforeseen risks enter the market.
- No new action is recommended for 2023 KC wheat crop. As weather becomes a more dominant market mover, we are targeting 670 – 700 versus May ’24 futures to recommend making additional sales. This area represents a modest 20% retracement back toward the 2022 highs.
- No new action is recommended for 2024 KC wheat. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside, and recommended exiting the original position in three separate tranches as the market got further extended into oversold territory to protect any gains that were made. The current strategy is to target 625 – 650 versus July ’24 futures to recommend additional sales.
- No action is currently recommended for 2025 KC Wheat. We currently aren’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It may be late spring or summer before Grain Market Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following KC recommendations:
Above: There remains considerable resistance in the area between the 50-day moving average and the March 10 high of 605 ¼. If prices can close above 605 ¼, they could continue towards the congestion range between 610 and 640. Otherwise, if they retreat back below initial support of 575, prices could potentially test the 551 ½ March low.
Action Plan: Mpls Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Mpls Wheat Action Plan Summary
Since last summer, Minneapolis wheat has slowly stair-stepped lower with weaker world prices and little bullish news to move markets higher. During this time, the 50-day moving average has acted as resistance, above which the market has not been able to hold for very long. Managed funds have also established and maintained a record (or near record) short position for much of the same time. Although bullish headwinds remain, the market has become very oversold, and the large fund net short position continues to leave the market susceptible to a short-covering rally at any time.
- No new action is currently recommended for 2023 Minneapolis wheat. The current strategy is to look for a modest retracement of the July high and target 675 – 700 to recommend more sales.
- No new action is recommended for 2024 Minneapolis wheat. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts (due to their higher liquidity and correlation to Minneapolis), to protect the downside, and recommended exiting the original position in three separate tranches as the market got further extended into oversold territory to protect any gains that were made. The current strategy is targeting the 775 – 815 area versus Sept ’24 to recommend making additional sales. We are also targeting the 850 – 900 area to recommend buying upside calls to help protect any sales that would have been made.
- No action is currently recommended for the 2025 Minneapolis wheat crop. We are currently not considering any recommendations at this time for the 2025 crop that will be planted in the spring of next year. It may be late spring or summer before Grain Market Insider starts considering the first sales targets.
To date, Grain Market Insider has issued the following Minneapolis wheat recommendations:
Above: Minneapolis wheat continues to trade sideways with overhead resistance near the 50-day moving average. Initial support remains below the market near the 630 level with more support near 600 if prices fall further. Up top, if the market reverses and closes above the 50-day moving average and 675 – 680 resistance, it could challenge the 700 – 710 area.
Other Charts / Weather
