5-14 End of Day: Turnaround Tuesday Strikes with Lower Markets Across the Board
All prices as of 2:00 pm Central Time
| Corn | ||
| JUL ’24 | 467.5 | -5 |
| DEC ’24 | 491 | -2 |
| DEC ’25 | 497 | 0.25 |
| Soybeans | ||
| JUL ’24 | 1214.5 | -5 |
| NOV ’24 | 1205 | -7.25 |
| NOV ’25 | 1191 | -6 |
| Chicago Wheat | ||
| JUL ’24 | 672.5 | -14.5 |
| SEP ’24 | 693.25 | -13.25 |
| JUL ’25 | 731 | -4.25 |
| K.C. Wheat | ||
| JUL ’24 | 683.25 | -16.75 |
| SEP ’24 | 697 | -16 |
| JUL ’25 | 726.75 | -10.25 |
| Mpls Wheat | ||
| JUL ’24 | 733.25 | -5 |
| SEP ’24 | 741.5 | -3.25 |
| SEP ’25 | 736.5 | -3.5 |
| S&P 500 | ||
| JUN ’24 | 5265.5 | 20 |
| Crude Oil | ||
| JUL ’24 | 77.68 | -0.92 |
| Gold | ||
| AUG ’24 | 2386.6 | 20.9 |
Grain Market Highlights
- Carryover pressure from the wheat complex and neighboring soybeans contributed to the negativity in the corn market, which traded lower in the day session following the print of a new high for the move in the overnight session from the slower than expected planting pace.
- Although the soybean market settled lower on the day, the market recovered most of its overnight losses after the July contract found support near its 20-day moving average along with help from the rally in soybean meal, which posted a bullish key reversal for the move.
- Soybean oil broke hard in today’s session, giving up much of the gains from the prior two days, as the rumored and much hoped for tariff increases on imported used cooking oil did not materialize. Soybean meal on the other hand, found potential support from long meal/short oil spread action as traders likely jumped back into the market from meal’s recent decline.
- Profit taking and sharply lower Matif wheat added to the negative tone in the wheat complex despite another crop analyst reduction to the Russian wheat crop. KC wheat led the declines, while Chicago posted a fresh high for the move before reversing lower.
- To see the updated US 5-day precipitation forecast, 6 – 10 day Temperature and Precipitation Outlooks, and the 1-week precipitation forecast for Brazil and N. Argentina, courtesy of NWS, CPC, 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
As July ’24 corn rallied beyond the congestion range on the front-month continuous charts, it began showing signs of being overbought, suggesting potential resistance to higher prices. Although managed funds have covered a significant portion of their net short position (sparking the recent rally) their remaining net short position could provide fuel for a more substantial upside move as planting transitions into the growing season. While obstacles persist for higher prices, overall market conditions and seasonal tendencies continue to support a sustained 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 July ’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 futures failed to follow through on Monday’s gains as selling pressure in the wheat market and soybean market spilled over into the corn futures. July corn double-topped Mondays highs and posted a reversal on the daily charts. The negative price action could lead to additional selling pressure into Wednesday. May corn futures finished its trading life on Tuesday. May futures closed trade at 453 ¾.
- The USDA crop progress report showed corn planting at 49% complete, in line with analyst expectations. This was up 13% over last week, but 5% below the 5-year average. Key states of Iowa (-13%) and Illinois (-14%) are behind the 5-year pace and additional slow planting could support the market. Weather models overall are staying on the wetter side but may have holes to provide opportunities to complete planting in some areas.
- The USDA announced a flash sale of corn to Mexico. Mexico purchased 15.9 mb (405,000 mt) of corn split between old and new crop. A total of 135,000 mt for the 23/24 marketing year and 270,000 mt for the 24/25 marketing year. These are routine sales of corn to Mexico and failed to move the market.
- The Brazil Ag agency, CONAB, released their May production expectations this morning. CONAB raised their Brazil corn production estimate to 111.6 mmt, up 672,000 mt from their April estimate. This is still down sharply from last year’s production of 131 mmt as producers have reduced corn acreage overall.
- The Corn market could be a crossroads point as weak price action in the grain market could be signaling a near-term top. The market will be looking for additional news to push prices higher, as the planting pace, at this time, is acceptable.
Above: A close above the May 7 high of 472 suggests the market could run toward the 495 – 510 resistance area from last fall. However, a reversal lower and a close below 454 initial support, could lead the market to test heavier support in the 445 – 440 range.
Corn percent planted (red) versus the 10-year average (blue) and last year (purple).
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
In early May the soybean market rallied out of its congestion range and above the March highs as Managed funds likely covered some of their net short positions. While the current supply/demand situation remains somewhat bearish, Managed funds remain net short the market and this breakout opens the door for a run towards the 1290 ¾ – 1296 ¾ chart gap and resistance area just above there if further production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to a reversal from the recent highs.
- No new action is recommended for 2023 soybeans. We are currently targeting a rebound to the 1275 – 1325 area versus July ’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 ended the day lower and were under pressure from sharply lower soybean oil, but soybean meal was higher which helped offset the losses in oil. July soybeans finished the day just above its 100-day moving average while the November contract remains well above.
- Yesterday’s crop progress report showed that 35% of the soybean crop has been planted which was lower than the average trade guess of 39%. This compares to 25% last week, 45% a year ago, and the 5-year average of 34%. 16% of the crop has reportedly emerged, which compares to 9% last week and 17% a year ago at this time.
- This morning, CONAB released its estimates for the Brazilian soybean crop and revised its number higher to 147.7 mmt. There is now a 6.3 mmt discrepancy between CONAB and the USDA with the USDA’s estimate last week at 154 mmt. With the flooding in Rio Grande do Sul, the USDA’s estimate is likely too high.
- Soybean oil tumbled this morning after the Biden administration announced tariffs on several Chinese products, but used cooking oil was not on the list as was previously rumored. Over the past week, soybean oil had been rallying based on that rumor as the decline in used cooking oil imports would create greater demand for soybean oil.
Above: July soybeans found nearby support at the 100-day moving average after reversing lower from the 1256 ½ high on May 7. Should this support hold and prices close above the May 7 high, they may again be poised to close the 1290 ¾ – 1296 ¾ gap and test the 1328 – 1352 resistance area. A close below the 100-day ma could set the market up for further declines with support between 1192 – 1146.
Soybeans percent planted (red) versus the 10-year average (blue) and last year (purple).
Wheat
Market Notes: Wheat
- US wheat futures closed lower across the board, with Paris milling wheat futures also experiencing sharp declines. This downward trend is likely due to profit-taking following a recent strong rally, exacerbated by lower corn and soybean futures.
- Yesterday’s crop progress report indicated that winter wheat conditions remained unchanged at 50% rated good to excellent. However, there was a 2% shift from fair to the poor to very poor category. This discrepancy may be attributed to the difference between HRW and SRW wheat, with the former being rated much lower than the latter. Additionally, 57% of the winter wheat crop is headed, compared to 46% last year and 44% on average. Moreover, spring wheat planting is reported at 61%, well ahead of last year’s 35% and the 48% average.
- Freezing conditions in Russia continue to pose a threat to their wheat crop, with several private estimates now forecasting production below 90 mmt. IKAR has reportedly lowered their projection by 5 mmt to 86 mmt. Dryness in the Black Sea area may also impact both the Russian and Ukrainian crops. Furthermore, excessive wet weather in parts of Europe, particularly France, adds to the bullish outlook on a global scale.
- CONAB has lowered their production estimate of Brazil’s wheat crop by 7% to 9.03 mmt. Lower acreage is cited as the reason for the decline, which itself is likely due to the recent torrential rains and flooding problems in Southern Brazil. For reference, the USDA estimated a 9.5 mmt crop on last Friday’s report.
- According to the Australian weather bureau, there is a 50% chance of a La Nina weather pattern developing later this year. This is a bit lower than some other estimates from around the world, including the Japanese weather bureau giving it a 60% chance. Regardless, the formation of this pattern should bring more moisture to eastern Australia, but drier conditions to North America.
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
In late April, Chicago wheat staged a rally, fueled mostly by Managed fund short covering on dryness in the southwestern Plains and potential damage to the Russian wheat crop, that took it through the major moving averages on the continuous chart, and last December highs. Although the market is showing signs of being overbought, which adds downside risk, the world wheat crop remains vulnerable which has the potential to drive an extended rally should production concerns linger or intensify.
- 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. Since weather became a much more dominant story for the wheat market, it appears that Chicago wheat may have established a springtime low. In light of this, Grain Market Insider has issued two separate recommendations to exit the second half of the July ’24 Chicago wheat 590 puts that were recommended for purchase last August. Considering that the crop is still developing, and weather remains a factor, we are aiming to recommend further sales within the 685 – 715 range versus July ’24 futures.
- No new action is currently recommended for 2025 Chicago Wheat. This spring, Grain Market Insider issued two sales recommendations to capitalize on the recent rally in July ’25 Chicago wheat prices for next year’s crop. To take further action, Plan A is to recommend making additional sales in the 775 – 800 range. In case the market comes up short of this upside target range, our current Plan B is a downside stop at 667. As long as the Jul ’25 contract remains above 667 support, the trend looks up to us and we will continue to target 775 – 800. If the Jul ’25 contract were to close below 667, it could be a sign that the trend is changing and 775 – 800 may no longer be an upside opportunity. Thus, a break of support would trigger an additional sale immediately.
To date, Grain Market Insider has issued the following Chicago wheat recommendations:
After closing above 684 on May 13, July ’24 Chicago remains on track to move toward the July high of 777 ¼, though psychological resistance also remains near 700. Should the market slide lower and close below nearby support near 628, it would then be at risk of testing the 593 area from late April.
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
Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590s on the topside and mid 550s down low, with little to move prices higher, all the while Managed funds continued adding to their large net short positions. Toward the end of April, dryness in the Black Sea region and the US HRW growing areas started becoming more concerning and triggered a short covering rally across the wheat complex, driving prices to levels not seen in over six months. Although US wheat exports continue to struggle to compete on the world market, which can keep a lid on US prices, and while Managed funds covered a significant portion of their net short positions, they remain short the market, which could still push prices higher if production concerns persist.
- No new action is recommended for 2023 KC wheat. Considering time is getting limited before the ’24 crop harvest, we recommended two sales on this most recent runup in prices to get old crop HRW wheat marketed. With that said, we are currently evaluating the market situation before setting a target for what will likely be our last sales recommendation for the 2023 HRW crop year.
- No new action is recommended for 2024 KC wheat. Since weather has become a much more dominant driver, marked by the market breaking out of its 2-month long 552 – 605 trading range, we recently recommended making a sale for the 2024 crop considering weather rallies can be short lived. Seeing that the crop is still developing, and weather has become a larger factor, we are currently targeting the 760 – 780 range 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: On May 13, July ’24 closed above 679 and challenged 700 psychological resistance, posting a high of 710. Should the market close above 710 it could then open the door for a rally toward the 720 – 754 congestion area from last September. If the market reverses to the downside, support may be found near 646 and again near 623.
On May 13, July ’24 closed above 679 and challenged 700 psychological resistance, posting a high of 710. Should the market close above 710 it could then open the door for a rally toward the 720 – 754 congestion area from last September. If the market reverses to the downside, support may be found near 646 and again near 623.
Action Plan: Mpls Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
Active
Sell JUL ’24 Cash
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
From mid-February through most of April, Minneapolis wheat traded mostly sideways to lower, lacking significant bullish fundamental news to drive prices upward. However, in late April, spurred by concerns over the world wheat crop and dry conditions in the HRW growing regions, Minneapolis wheat experienced a rally back towards last fall’s highs. Despite lingering obstacles for the US wheat market and indications of overbought conditions, historical seasonal trends typically strengthen in late spring and early summer. Moreover, the fact that Managed funds still maintain a net short position suggests the potential for an extended rally if further production concerns emerge.
- Grain Market Insider sees a continued opportunity to sell a portion of your 2023 Spring wheat crop. Since mid-April July ’24 Minneapolis wheat has rallied more than 110 cents from the springtime low and is now near the resistance area from last fall’s highs. Given that this rally is likely driven by world supply concerns and weather, we recommend capitalizing on these elevated prices by selling another portion of your 2023 spring wheat production.
- 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 close above 731 could put the July ’24 contract on track to test the November high of 752, and then the 767 – 791 congestion area from last September. Below the market, nearby support remains around 697 – 690 ½, a close below which could signal a further decline toward support levels at 675 and 660.
Spring wheat percent planted (red) versus the 10-year average (blue) and last year (purple).
Other Charts / Weather
Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.
Brazil and N. Argentina 1-week forecast total precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.