4-10 End of Day: Markets Close Mixed Ahead of Tomorrow’s USDA WASDE Update
All prices as of 2:00 pm Central Time
| Corn | ||
| MAY ’24 | 434.25 | 3 |
| JUL ’24 | 445.75 | 3.25 |
| DEC ’24 | 470.25 | 2 |
| Soybeans | ||
| MAY ’24 | 1164.75 | -9.75 |
| JUL ’24 | 1178 | -9.75 |
| NOV ’24 | 1169.25 | -9 |
| Chicago Wheat | ||
| MAY ’24 | 558.5 | 0.75 |
| JUL ’24 | 573.5 | 1.5 |
| JUL ’25 | 643.25 | 0.5 |
| K.C. Wheat | ||
| MAY ’24 | 594.5 | 17.25 |
| JUL ’24 | 587.75 | 13.5 |
| JUL ’25 | 636.5 | 8.5 |
| Mpls Wheat | ||
| MAY ’24 | 651.75 | 0.5 |
| JUL ’24 | 659 | 1.25 |
| SEP ’24 | 668.75 | 2.75 |
| S&P 500 | ||
| JUN ’24 | 5198.5 | -61.75 |
| Crude Oil | ||
| JUN ’24 | 85.51 | 1.05 |
| Gold | ||
| JUN ’24 | 2352.9 | -9.5 |
Grain Market Highlights
- Corn closed within pennies of its 50-day moving average for the 5th consecutive day as it traded in a tight 5-cent range and continues to consolidate ahead of tomorrow’s USDA WASDE report. Solid weekly ethanol production numbers and higher wheat prices lent support, while lower soybean prices limited gains.
- Despite a flash sale to unknown destinations, soybeans went from higher overnight to lower during the day session, with additional pressure coming from the higher US Dollar and increased technical selling once last week’s low of 1168 ½ was breached.
- Soybean meal closed lower on the day and contributed to the weakness in the soybean pit. Meal saw increased technical selling below the 20-day moving average, while buying support for soybean oil held down near its 50-day moving average and helped it close in the green with further support from higher crude oil.
- The wheat complex settled higher with support coming from higher Matif wheat futures. KC showed the strongest gains, closing near its highs, while Chicago and Minneapolis turned lower to close near their lows after testing their respective 50-day moving averages.
- To see the updated US 5-day precipitation forecast, NASA-Grace root zone drought indicators for the US and South America, and 1-week precipitation forecast for Brazil and N. Argentina, courtesy of the NWS and NOAA and NASA-Grace 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 252,000 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
- The corn market stayed trapped between the other grains during the session. Selling pressure in the soybean market limited gains, but positive trade in the wheat markets provided support as the market stayed choppy.
- The USDA will release the April WASDE report tomorrow, Thursday, April 11. Expectations are for corn ending stocks to be reduced to 2.102 billion bushels, down 70 mb from last month. This should reflect the strong first quarter corn usage as reflected in last month’s Quarterly Grain Stocks report.
- The corn production numbers for Brazil and Argentina may be more of a focus for the market on the WASDE report. Current USDA estimates are well above analyst estimates for both Argentina and Brazil corn crops. Traders will be watching to see if the gap between the two narrows. The Brazilian Ag agency, CONAB, will also release its production estimates on Thursday morning.
- The USDA will release weekly corn sales on Thursday morning. Expectations for new sales range from 750,000 –1.3 mmt. Last week, new corn sales totaled 947,000 mt.
- Weather forecasts for temperatures into the end of April are predicted to stay above normal, which could allow for planting progress to pick up speed for this year’s US corn crop. The biggest near-term concern could be wet planting in the eastern corn belt with predicted rains.
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 breakout and close above resistance between the recent high of 448 and the January high of 452 ¼, they could run toward the next major resistance level of 495 – 510. 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 135,000 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 closed lower for the third consecutive day, mainly due to pressure from lower soybean meal, while soybean oil made a recovery and finished the day slightly higher. A big bearish factor today was the sharp increase in the US Dollar Index which makes US exports more expensive, and slow exports have already been an issue.
- Today, consumer price index (CPI) data was released by the Labor Department, which showed that consumer prices rose by 3.5% in March from the previous year. The consumer price index rose by 0.4% from February to March instead of the 0.3% that was expected, and this has traders concerned that with inflation higher than expected, interest rates may not be lowered this year. This caused the dollar to rally, which is typically bearish for commodities.
- This morning, private exporters reported a flash sale of 254,000 metric tons of soybeans for delivery to unknown destinations during the 24/25 marketing year. Estimates for tomorrow’s Export Sales report have soybean sales between 200k and 600k tons, and the report will include the 152,000 mt flash sale reported last week.
- Tomorrow, the USDA will release its WASDE report at 11am CDT. No major changes are anticipated, but estimates are for US ending stocks to increase slightly by 4 mb to 319 mb and for world ending stocks to decrease slightly. In South America, Argentine soybean production is expected to increase by 0.4 mmt to 50.4 mmt. In Brazil, the USDA is expected to lower their production by 2.7 mmt to 152.3 mmt.
Above: After closing below the 50-day moving average and 1168 support, the market is at risk of drifting lower and testing support between 1140 and the February low of 1128 ½. However, the market is also showing signs of being oversold, which can be supportive to a move higher. For now, initial resistance lies near the 50-day moving average of 1180 ½ with heavier resistance remaining near the recent high of 1226 ¾.
Wheat
Market Notes: Wheat
- Though Kansas City wheat ended with double-digit gains, Chicago did not show much strength, but it was able to claw its way back to a positive close with support from Matif wheat, which gained 2.75-3.50 euros today. Minneapolis also posted small gains. The strength in the wheat complex came despite the US Dollar rising to the highest level since mid-November after today’s CPI data indicated inflation was higher than expected.
- Some of today’s strength in wheat may have stemmed from reports that Russian wheat FOB values have steadily climbed by $14 over the past three weeks. They remain the world’s cheapest offer and at a $20 discount to France and Germany, but with the gap beginning to narrow, it may allow US wheat to become more competitive down the road.
- Traders will shift their focus tomorrow towards the highly anticipated monthly WASDE report. Regarding wheat, significant changes are not anticipated. Global carryout is expected to remain steady at 258.6 mmt, nearly unchanged from last month’s 258.8 mmt, yet lower compared to 271.1 mmt from the previous year. The average ending stocks estimate for US wheat stands at 685 mb, up from 673 mb in March and from 570 mb last year. Estimates for wheat production in 24/25 won’t be disclosed tomorrow; traders will need to await the May WASDE report for that information.
- Two vessels destined for Egypt carrying Russian wheat were held up at Russian ports due to quality concerns. One of the ships is now on the way after Egypt’s Foreign Ministry stepped in to resolve the dispute; some are suggesting that the Kremlin is attempting to take more control of exports. On a related note, there has been talk that Russia may count crop production in occupied Ukrainian territory towards their own numbers. This would bring Russia’s wheat crop from 90-92 mmt to 100 mmt, but the USDA may not acknowledge these adjustments.
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: The market has fallen away from the 50-day moving average and may be at risk of testing the 523 ½ low if it closes below 537. If prices turn back around and close back above the 50-day moving average, they could still encounter resistance in the 585 – 620 area.
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. Considering the current US export demand challenges and the sideways nature of the wheat market, we are looking for prices to return to the upper end of the recent range and are targeting the 600 area versus May ’24 to recommend making additional sales.
- 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: Significant resistance remains within the range bound by the 50-day moving average and the March 10 high of 605 ¼. A close above 605 ¼ might pave the way for further advancement toward the congestion area of 610 – 640. Otherwise, should prices retreat below the initial support level of 561, there’s a possibility of testing the March low of 551 ½.
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
Minneapolis wheat has primarily traded within a range since last February until a recent breakout below its lower boundary, marking new contract lows and potentially signaling a continuation of the downtrend initiated last summer. Despite facing resistance from the 50-day moving average and a lack of bullish catalysts, seasonal patterns tend to improve heading into early summer. Furthermore, managed funds still maintain a large net short position, which might trigger 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: The recent turnaround after posting a 662 ¾ high and testing the 50-day moving average indicates heavy resistance in the 660 – 670 area. Prices may still challenge this area and close above it if a bullish catalyst enters the scene. If so, the next major resistance area may be near 700 – 712. If prices slide lower, and close below 638, there’s a risk of retracement towards psychological support at 600 and the March ’21 low of 596 ¼.
Other Charts / Weather
Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.
Above: Brazil and N. Argentina 1-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.
Above: Brazil and N. Argentina 1-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.