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5-13 End of Day: Sharply Higher Wheat Lends Support to Corn and Beans

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • After an initial surge higher on the 8:30 cdt open of the day session, July corn chopped mostly sideways in a tight three-cent range, caught between a strong wheat market, a potentially concerning planting pace, and heavy supply picture.

  • Despite lower soybean meal, higher soybean oil, sharply higher wheat, and solid weekly soybean export inspections, helped July soybeans to close in the green, after a day of choppy two-sided trade.

  • Soybean meal closed lower for the fourth consecutive day and just off the day’s low as it followed through on technical weakness from last week. Soybean oil on the other hand likely saw support from higher palm oil and continued support from higher potential import duties on used cooking oil (ucd) for biofuel use.

  • Higher Matif wheat and lower wheat production and export projections for Russia fed the bull in the wheat complex today, potentially leading to more short covering across all three classes. July Chicago posted its highest close since early August, while July KC had its highest close since early October.

  • 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.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

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 progresses 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:

  • Despite strong wheat and soybean markets to start the week, corn futures only posted slight gains as the market is trying to balance out the forecasted heavy supply picture, planting progress, and the overall demand for corn.

  • Managed funds drastically reduced their net short position in the corn market last week.  On last week’s Commitment of Traders report, funds reduced their total net short positions by 115,527 contracts to 102,513 contracts.  In total, managed money has removed nearly 240,000 contracts since the February price low.

  • USDA will release weekly planting progress this afternoon.  Expectations are for corn planting to reach 49% complete, up 13% from last week.  The planting pace could be limited toward that target with wet weather over the corn belt in the past week, but the pace likely improved going into the weekend in some areas. 

  • Weekly Export inspections for corn were within market expectations.  Last week, US exporters shipped 36.9 mb (938,000 mt) of corn. Total exports have reached 1.336 billion bushels, up 30% from last year.  The USDA has forecasted a 29% increase year over year.

  • The grain markets will be focused on weather for the next couple of weeks.  Forecasts look mixed across the corn belt as some producers have struggled to stay on pace with planting this spring’s crop.

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 Managed Money Funds net position as of Tuesday, May 7. Net position in Green versus price in Red. Managers net bought 115,527 contracts between May 1 – 7, bringing their total position to a net short 102,513 contracts.

Soybeans

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:

  • Soybeans closed higher for the day despite initially trading lower overnight. However, they also settled 9 cents below their midday highs. Soybean meal closed significantly lower while soybean oil ended higher by 1.60%. Both July and November soybeans closed above the 100-day moving average.

  • Friday’s WASDE report was relatively neutral for soybeans, but they got a boost from sharply higher soybean oil and friendly numbers for corn and wheat. Once again, the USDA was very conservative with adjusting Brazilian production and only lowered it by 1 mmt. CONAB maintains a much lower estimate that will be updated tomorrow.

  • Planting faced challenges again last week with rain across most of the Midwest, but some work was able to get done over the weekend. The USDA will release its crop progress report later today, and analysts expect that 38% will have been planted as of Sunday which compares to 25% last week and 49% last year.

  • Today’s export inspections report showed an increase of 14.9 mb of soybeans which puts total inspections at 1.453 billion bushels which is down 18% from the previous year.

  • Friday’s CFTC report showed funds covering a huge portion of their short position buying back 107,783 contracts, leaving them net short just 41,453 contracts. That short covering resulted in a rally of about a dollar.

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.

Soybean Managed Money Funds net position as of Tuesday, May 7. Net position in Green versus price in Red. Money Managers net bought 107,783 contracts between May 1 – 7, bringing their total position to a net short 41,453 contracts.

Wheat

Market Notes: Wheat

  • Wheat closed sharply higher today in all three categories. With the US Dollar Index down and front month September Matif wheat futures reaching the highest level since late July of last year, funds are believed to be continuing to buy back their short positions in the wheat complex.

  • Weekly wheat export inspections at 13.5 mb bring the total 23/24 inspections to 649 mb, which is down 6% from a year ago.  The USDA is now estimating 23/24 exports at 720 mb, up 10 mb from the previous estimate, but still down 5% compared to last year.

  • New threats of freeze damage in Russia over the weekend may have caused some additional fund short covering today, with SovEcon reducing their estimate of Russian wheat production by 3.5 mmt to 89.6 mmt. Dryness in the Black Sea area remains a concern as well.

  • India’s wheat stocks are said to have hit a 16-year low; their government has made record sales from its reserves in an effort to lower food prices and inflation. This could mean that India will be a net importer of wheat, which would add bullishness to the market.

  • In the southern hemisphere, weather concerns are arising that could impact wheat. Cold conditions in Argentina have led to frost, potentially affecting recently planted winter wheat. Meanwhile, in Australia, most areas remain too dry. Although New South Wales received some rainfall over the weekend, conditions outside of this region haven’t been favorable for winter wheat. Farmers in these areas are anticipating improved soil moisture as the transition to La Niña unfolds in the coming months.

Chicago Wheat Action Plan Summary

Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and a close below 593 ½ may encounter support around the 50-day moving average with 548 support below that.

  • 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.

  • Grain Market Insider sees a continued opportunity to sell another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs, as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: With the market close above 684, it remains on track to move toward the July high of 777 ¼, though it may encounter psychological resistance around 700. A slide lower and a close below 628 nearby support puts the market at risk of testing the 593 area from late April.

Chicago Wheat Managed Money Funds net position as of Tuesday, May 7. Net position in Green versus price in Red. Money Managers net bought 5,506 contracts between May 1 – 7, bringing their total position to a net short 42,360 contracts.

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 since last December. 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: The market close above 679 led it to test the 700 psychological resistance area, a solid close above which could 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.

KC Wheat Managed Money Funds net position as of Tuesday, May 7. Net position in Green versus price in Red. Money Managers net bought 5,597 contracts between May 1 – 7, bringing their total position to a net short 24,013 contracts.

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 recommends selling 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 last fall’s highs.  Given that this rally is likely driven by world supply side 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.

Minneapolis Wheat Managed Money Funds net position as of Tuesday, May 7. Net position in Green versus price in Red. Money Managers net bought 6,284 contracts between May 1 – 7, bringing their total position to a net short 3,010 contracts.

Other Charts / Weather

Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

Brazil and N. Argentina 1-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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5-10 End of Day: Sharply Higher Wheat and Bean Oil Support Corn and Beans into the Close

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Strong buying in the wheat complex and a neutral to friendly WASDE report helped July corn futures rally to their highest weekly close since early January

  • The soybean market closed in the green with help from sharply higher soybean oil, following the release of the mostly neutral WASDE report.

  • While July meal settled just $1.0 lower after trading a broad $12.0 range, July bean oil gained 4.2% and 1.80 cents on the day on rumors that the US may raise import duties on used cooking oil that is being used to make biofuel.

  • All three wheat classes rallied into the close with significant gains across the board. Continued concerns regarding Russia’s wheat production kept the markets firm in the overnight session, while a somewhat friendly WASDE report added support.

  • To see the updated US 5-day precipitation forecast, 6 – 10 day Temperature and Precipitation Outlooks, and the current and last year’s US Drought Monitors, courtesy of NWS, NOAA, and the NDMC, scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Despite July ’24 corn rallying beyond the congestion range on the front-month continuous charts, the market exhibits signs of being overbought, potentially adding resistance to higher prices. However, managed funds have retained a significant net short position, likely sparking the recent rally which could fuel a more substantial upside move as we progress through planting and into the growing season. Despite potential obstacles, 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:

  • Corn futures finished near the highs for the week supported by a neutral to friendly WASDE report, and strong buying in the wheat markets. For the week, July corn gained 9 ½ cents and posted its highest weekly close since the second week in January.

  • Friday’s USDA Supply/Demand report posted friendly numbers for old crop corn according to expectations. The USDA added 50 mb of demand to both ethanol production and exports to lower carryout to 2.022 billion bushels. This was 100 mb below expectations, supporting old crop prices.

  • The USDA released initial projections for the 24/25 marketing year. As expected, planted acres for the next crop year was 90 million acres with trend line yield of 181 bushels/acre. After minor demand adjustments, year over year new crop carryout is projected at 2.102 billion bushels. This was below market expectations, but still reflects a relatively heavy corn supply for the next marketing year.

  • The USDA projections for South American corn production saw mild reductions from the April report. The USDA lowered Argentine corn production to 53 mmt and Brazil production to 124 mmt, each down 2 mmt from the April report, but still ahead of analyst estimates from those regions. 

  • The market will shift its focus back to planting weather. Recent rainfalls have limited planting progress, but longer-range forecasts are turning drier overall. Crop progress numbers on Monday afternoon may be key for near-term market moves. Last week, corn planting was 36% complete nationally.

Above: The recent move up took July corn into overbought status and to a high of 472, just above the 200-day moving average. Being overbought makes the market more vulnerable to a downturn. Should that occur, support may be found down near 445 to 440. If prices turn back higher, initial resistance remains near the 472 high, and then again around 495 – 510.

Soybeans

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:

  • Soybeans ended the day higher following the USDA’s WASDE report which was relatively neutral for soybeans. The support today came from soybean oil which rallied sharply over 4% as a result of import duties on cooking oils potentially being raised significantly. Soybean meal ended the day lower, and July soybeans are trading back above the 100-day moving average.

  • Today’s WASDE report said that old crop ending stock estimates for soybeans were unchanged at 340 mb and the first projection for 24/25 production was posted at 4,450 million bushels which was slightly higher than the average trade guess. New crop ending stocks were pegged at 445 mb which was above the average trade guess. Brazilian soybean production was revised lower by 1 mmt to 154 mmt and Argentinian production was surprisingly unchanged at 50 mmt.

  • For the week, July soybeans gained 4 cents but are down 37 cents from the Tuesday highs. November soybeans ended the week up 4 ¾ at 1205 ¾, July soybean meal lost just $0.30 at $371.90, and July soybean oil gained 1.36 cents to 44.44 cents. Funds were likely net buyers of soybeans this week after being spurred by planting delays and South American weather issues.

  • The extreme flooding in Rio Grande do Sul, Brazil is causing the soybeans left in the field to deteriorate, and StoneX has cut their estimates for Brazilian production by 3 mmt as a result. This reduction brings their estimate for the bean crop to 147.8 mmt compared to 150.8 mmt in their last estimate.

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.

Wheat

Market Notes: Wheat

  • The wheat complex was strong overnight and into the 11 am CDT USDA WASDE report, as it continued to grapple with concerns regarding the Russian wheat crop with dry weather and the recent cold snap. Somewhat friendly supply and demand numbers helped press all three wheat classes higher into the close, with July Chicago setting a new high for the move and the highest close since last August.

  • The USDA released its monthly WASD report today, pegging 23/24 wheat carryout at 688 million bushels versus the average trade guess of 696 mb. They estimated 24/25 total wheat production at 1.858 bb, with carryout at 766 versus 786 mb expected. As for world ending stocks, 23/24 came in at 257.8 mmt with 24/25 at 253.61 mmt versus expectations of 256.9 and 257.37 mmt respectively.

  • The USDA made no changes to the Russian wheat crop and left its estimate at 91.5 mmt. SovEcon on the other hand lowered its estimate of Russian wheat production by 3.4 mmt to 89.6. The USDA did lower its forecast for Ukraine’s wheat crop 0.4 mmt to 23 mmt.

  • The Buenos Aires Grain Exchange in Argentina is projecting the country’s 24/25 wheat production to increase 20% to 18.1 mmt due to the recent rains that have set the stage for a good growing season. The exchange also sees wheat 24/25 wheat exports rising 24% from last year to 11.5 mmt.

  • A western Australian industry group raised concerns about Australia’s wheat crop due to the persistent dry weather and lowered its planted area estimate to 4.7 million hectares from its April forecast of 4.96 million.

Chicago Wheat Action Plan Summary

Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and a close below 593 ½ may encounter support around the 50-day moving average with 548 support below that.

  • 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.

  • Grain Market Insider sees a continued opportunity to sell another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs, as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and a close below 593 ½ may encounter support around the 50-day moving average with 548 support below that.

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 since last December. 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: Front-month KC wheat appears to be consolidating following the recent rally. Nearby support below the market sits near 623, with nearby resistance just overhead near the recent 679 high. A close above 679 should be supportive for a run towards 700 psychological resistance, while a close below 623 could open the door for a slide toward 600 support.

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.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: After reaching a high of 731 in July Minneapolis wheat, the market seems to be consolidating after becoming overbought. Nearby support is around 697 – 690 ½, and a close below this range could signal a further decline toward support levels at 675 and 660. Conversely, a close above 731 could pave the way for prices to advance toward the November high of 752, although resistance may be encountered in the 725 – 735 area.

Other Charts / Weather

Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

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5-9 End of Day: Wheat Higher, Corn Quiet, and Soybeans Lower Again Ahead of USDA Report Friday

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • The corn market traded quietly sideways today ahead of tomorrow’s USDA May WASDE report. Strong, as expected, export sales and higher closes in wheat helped add underlying support.

  • A second consecutive day of sharply lower trade across the soybean complex pulled front month soybean futures back near the $12 futures level. Cuts are expected to both Argentina and Brazil’s soybean crop sizes by the USDA in tomorrows WASDE.

  • Wheat futures closed higher across the board on Thursday as thoughts that recent freeze damage in Russia may be more widespread than originally thought, frost potential returns for Russian wheat areas this weekend.  Higher Paris wheat futures and a lower US dollar index also helped to add support.

  • To see the updated US last 72-hour precipitation map, and the US 4-inch soil moisture percentile map courtesy of NASA, scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Despite July ’24 corn rallying beyond the congestion range on the front-month continuous charts, the market exhibits signs of being overbought, potentially adding resistance to higher prices. However, managed funds have retained a significant net short position, likely sparking the recent rally which could fuel a more substantial upside move as we progress through planting and into the growing season. Despite potential obstacles, 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:

  • The corn market traded in a tight 3 ¼ cent range for most of the day after giving up overnight gains as it consolidated ahead of tomorrow’s USDA WASDE report. Although July corn closed towards the lower end of its range, it held Monday’s low and the 20-day moving average.

  • The USDA released its export sales report for the week ending May 2. Corn export sales came in as expected at 35 million bushels for the 23/24 marketing year, and 1.93 mb for the 24/25 new crop. There was also a flash sale reported, totaling 5.2 million bushels (132,080 mt) of corn to Mexico, 2.4 mb (60,960 mt) for the 23/24 marketing year and 2.8 mb (71,120 mt) for 24/25.

  • Tomorrow, the USDA will release its May WASDE report, which will also be the first look at this year’s 24/25 production. The average trade guess for 23/24 US old crop corn ending stocks is 2.094 billion bushels, 28 mb less than April’s estimate. Whereas US 24/25 new crop corn ending stocks are estimated to come in at 2.282 bb, using a 180.7 bpa yield. The trade will also be watching to see how much of a reduction the USDA makes to its South American estimates, which currently stand at 124 mmt and 55 mmt respectively for Brazil and Argentina.

  • The Rosario Grain Exchange, in its April report released on Wednesday, adjusted the estimated Argentine corn crop downward to 47.5 mmt from March’s estimate of 50.5 mmt. This adjustment suggests a significant shift due to the leaf hopper infestation.

  • Following Friday’s USDA report, the planting pace will return to the forefront of the market’s focus. Planting may continue to face challenges as another weather system moves across the Corn Belt. While the forecast indicates a break in the weather in the middle of the month, expectations point to a warm and wetter pattern persisting into the end of May.

Above: The recent move up took July corn into overbought status and to a high of 472, just above the 200-day moving average. Being overbought makes the market more vulnerable to a downturn. Should that occur, support may be found down near 445 to 440. If prices turn back higher, initial resistance remains near the 472 high, and then again around 495 – 510.

Soybeans

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:

  • Soybeans closed sharply lower for the second consecutive day with pressure from lower soybean meal and oil, with bean oil posting more significant losses. July soybeans closed below the 100-day moving average while the November contract closed above it. There has likely been farmer selling following the recent rally along with funds squaring positions ahead of tomorrow’s WASDE report.

  • Early trade estimates for Friday’s USDA report have the 23/24 soybean ending stocks relatively unchanged, and the ending stocks for 24/25 are estimated at 439 mb, using a soybean yield of 52.0 bpa. The Argentinian bean crop is expected to be revised lower to 49.7 mmt from 50 mmt, and Brazil’s production is expected to be lowered to 152.5 mmt from 155 mmt last month.

  • In Brazil, there remain large issues regarding the soybeans which have not been harvested and remain in the fields due to severe flooding in Rio Grande do Sul. The extent of the damage is yet unknown, but that state is a key exporter of soybeans and could impact exports to Argentina and therefore Argentinian meal exports.

  • Today’s export sales report showed an increase of 15.8 mb of soybean export sales for 23/24 and 0.2 mb for 24/25. This was within the average range of trade estimates and puts total sales down 17% from a year ago. Last week’s export shipments of 11.2 mb were below the 12.5 mb needed each week to achieve the USDA’s export estimates. Primary destinations were to China, Egypt, and Mexico.

Above: While the close above the 1248 January high on May 6 set the market up to target the 1290 ¾  – 1296 ¾ gap and the subsequent 1328 – 1352 resistance area, it also left the market overbought and vulnerable to a decline. Initial support could be found between 1227 and 1207, with further support between 1192 and 1146 if the market slides further.

Wheat

Market Notes: Wheat

  • Wheat closed modestly higher in all three categories, stopping the bleeding of the last couple days. Support came from the US Dollar Index turning negative, as well as a higher close for Paris milling wheat futures. Both the Matif and US futures were likely responding to talk that the freeze damage in Russia may have caused more harm to their wheat than originally thought. Some estimates of the Russian crop have now fallen below 90 mmt, compared to 93 mmt recently.  

  • The USDA reported an increase of only 1.5 mb of wheat export sales for 23/24 and an increase of 14.9 mb for 24/25. Shipments last week at 12.4 mb fell below the 13.5 mb pace needed per week to reach the export goal of 710 mb. Export shipments now total 627 mb, which is up 2% from last year.

  • The average pre-report estimate for US 23/24 wheat carryout is pegged at 689 mb, compared to 698 in April. World ending stocks for 23/24 wheat are expected to come in at 258.1 mmt, down from 258.3 in April. The average guess for US 24/25 carryout is 786 mb, with the world 24/25 ending stocks estimate at 256.9 mmt.

  • US 24/25 all wheat production is anticipated on tomorrow’s report at 1.889 bb vs 1.812 in 22/23. Of that total, winter wheat in particular is expected at 1.305 bb vs 1.248.

  • According to the USDA, about 28% of the US winter wheat crop is still experiencing drought conditions as of May 7, unchanged from the prior week. Additionally, recent rains have drastically reduced the spring wheat area in drought, which has declined from 27% to 15% for the same time period.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, fueled mostly by Managed fund short covering, HRW crop concerns, and dryness in southern Russia, that took it through the major moving averages on the continuous chart, and towards last December highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a net short position that has the potential to drive an extended short covering rally should these 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.

  • Grain Market Insider sees a continued opportunity to sell another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs, as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and close below 593 ½ may encounter support around the 50-day moving average (568) with 548 support below that.

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 since last December. 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: Front-month KC wheat appears to be consolidating following the recent rally. Nearby support below the market sits near 623, with nearby resistance just overhead near the recent 679 high. A close above 679 should be supportive for a run towards 700 psychological resistance, while a close below 623 could open the door for a slide toward 600 support.

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.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: After reaching a high of 731 in July Minneapolis wheat, the market seems to be consolidating after becoming overbought. Nearby support is around 697 – 690 ½, and a close below this range could signal a further decline toward support levels at 675 and 660. Conversely, a close above 731 could pave the way for prices to advance toward the November high of 752, although resistance may be encountered in the 725 – 735 area.

Other Charts / Weather

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5-8 End of Day: Markets Close Lower Across the Board as They Consolidate Ahead of Friday’s Report

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Talk of heavy farmer selling in both the US and South America weighed on the corn market which saw follow through selling on Monday’s loss of upward momentum. July corn futures retraced lower to settle at its 100-day moving average.

  • The soybean market closed lower across the board, as traders took profits and squared positions from the recent rally ahead of Friday’s WASDE report.

  • Both soybean products also settled lower today. July soybean oil reversed lower as it hit resistance at its 20-day moving average, following the sharp decline in Malaysian palm oil. Soybean meal saw another day of profit-taking, with traders likely exiting long positions ahead of Friday’s report.

  • Lower Matif wheat, a stronger US Dollar, and a report from SovEcon putting Russia’s April wheat stocks 65% ahead of the historical average likely triggered a round of profit taking the wheat complex, pressuring prices lower in all three classes. 

  • To see the updated US 5-day precipitation forecast, the US 6 – 10 and 8 – 14 day Temperature and Precipitation Outlooks, as well as the 1-week total precipitation for Brazil and N. Argentina, courtesy of NOAA, NWS, and CPC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Despite July ’24 corn rallying beyond the congestion range on the front-month continuous charts, the market exhibits signs of being overbought, potentially adding resistance to higher prices. However, managed funds have retained a significant net short position, likely sparking the recent rally which could fuel a more substantial upside move as we progress through planting and into the growing season. Despite potential obstacles, 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:

  • Strong selling hit the grain markets, pulling corn lower on the day as the recent rally’s momentum seemed to lose steam on Tuesday, and saw follow through selling on Wednesday. July corn futures fell back to test support at the 100-day moving average. This will likely be a key support level for Thursday’s session.

  • Talk of strong producer selling of corn in the US, Brazil, and Argentina likely weighed on corn markets as the recent price rally provided opportunities for producers to get caught up on sales for both old and new crop bushels. The movement of corn has been reflected in a widening basis in some areas of the Corn Belt. South American sales moved more bushels to ports for export, creating competition against US corn.

  • The USDA will release weekly export sales on Thursday morning. Expectations are for new sales from last week to be near the 700,000 mt – 1.0 mmt levels. On last week’s report, US exporters reported new sales of 759,000 mt.

  • The USDA will release the next WASDE report on Friday morning. The May report will give the market its first estimates for the 24/25 marketing year and updates for the current marketing year. Old crop corn carryout is expected to decrease slightly, but 24/25 will likely show the potential for large production and increased carryout year over year.

  • After the release of Friday’s USDA report, the planting pace will move back into focus for the market. Planting will continue to struggle as another weather system is moving across the Corn Belt this week. The forecast is showing a break in the weather in the middle of the month, but expectations are for a warm and wetter forecast into the end of May.

Above: The recent move up took July corn into overbought status and to a high of 472, just above the 200-day moving average. Being overbought makes the market more vulnerable to a downturn. Should that occur, support may be found down near 445 to 440. If prices turn back higher, initial resistance remains near the 472 high, and then again around 495 – 510.

Soybeans

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:

  • Soybeans finished the day significantly lower along with lower closes in both soybean meal and oil. Much of today’s downward pressure was likely due to profit taking following the recent rally along with positioning ahead of Friday’s WASDE report. Planting delays in the US along with flooding in South America has been supportive to this rally.

  • Early trade estimates for Friday’s USDA report have the 23/24 soybean ending stocks relatively unchanged, and the ending stocks for 24/25 are estimated at 439 mb, using a soybean yield of 52.0 bpa. The Argentinian bean crop is expected to be revised lower to 49.7 mmt from 50 mmt, and Brazil’s production is expected to be lowered to 152.5 mmt from 155 mmt last month.

  • In Argentina, there is a big problem with leaf hopper insects spreading disease among the corn crop, and there is a possibility that this could continue into further seasons, especially with warmer weather. As a result, many Argentinian producers are reporting that they will plant more soybeans than corn in the future in order to mitigate potential yield losses in corn.

  • The flooding in Rio Grande do Sul has been a large impact on this rally and specifically has benefitted soybean meal as Brazil typically exports a portion of its bean crop to Argentina to be crushed. The flooding comes after a season that suffered through drought conditions as well further impacting yields in those areas.

Above: While the close above the 1248 January high on May 6 set the market up to target the 1290 ¾  – 1296 ¾ gap and the subsequent 1328 – 1352 resistance area, it also left the market overbought and vulnerable to a decline. Initial support could be found between 1227 and 1207, with further support between 1192 and 1146 if the market slides further.

Wheat

Market Notes: Wheat

  • Wheat finished with losses in all three classes today. The US Dollar Index has been trending higher the past two days, putting pressure on the market. Additionally, Matif wheat was down again today, offering weakness. Profit taking after the recent strong uptrend may also be considered a culprit for the lower trade today.

  • Russia has reportedly reduced their wheat export tax by 3% to 3,171 rubles per mt, for the time period ending May 21. In other news, Russia is said to have been the lowest offer for Egypt’s wheat tender, at $255 per mt FOB. In a final note about Russia, Sov Econ has reported their wheat stocks at the end of April to be 27.5 mmt, which is 65% above the average.

  • The flooding in Rio Grande do Sul in southern Brazil has caused damage to the soybean crop in addition to transportation and logistics issues. As it relates to wheat, the wet weather is also causing major delays to winter wheat planting in the region.

  • A crop tour in Oklahoma has come up with a projected 2024 wheat crop at just over 89 mb, with an average yield of 33.68 bpa. These estimates were the result of field assessments led by educators from Oklahoma State University Extension, as well as crop consultants and agronomists.

  • China has reportedly approved the safety of genetically edited wheat for the first time. Over the past year or so they have approved the use of certain GMO soybean and corn seeds as well. The key difference is that genetic editing involves altering the plant’s existing genes, while genetic modification involves the implementation of foreign genes into the plant’s DNA. This is a step forward for China as they work to become more self-sufficient with their agriculture.

  • Later this week, record cold temperatures may hit parts of Russia and Ukraine, which may affect spring crops. However, damage to winter wheat is not expected to be much of an issue, as is evident by a lack of response from the market at this time.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, fueled mostly by Managed fund short covering, HRW crop concerns, and dryness in southern Russia, that took it through the major moving averages on the continuous chart, and towards last December highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a net short position that has the potential to drive an extended short covering rally should these 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.

  • Grain Market Insider sees a continued opportunity to sell another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs, as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and close below 593 ½ may encounter support around the 50-day moving average (568) with 548 support below that.

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 since last December. 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: Front-month KC wheat appears to be consolidating following the recent rally. Nearby support below the market sits near 623, with nearby resistance just overhead near the recent 679 high. A close above 679 should be supportive for a run towards 700 psychological resistance, while a close below 623 could open the door for a slide toward 600 support.

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.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: After reaching a high of 731 in July Minneapolis wheat, the market seems to be consolidating after becoming overbought. Nearby support is around 697 – 690 ½, and a close below this range could signal a further decline toward support levels at 675 and 660. Conversely, a close above 731 could pave the way for prices to advance toward the November high of 752, although resistance may be encountered in the 725 – 735 area.

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.

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5-7 End of Day: Turnaround Tuesday Strikes as Grains Close Mostly Lower Following Monday’s Rally

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Farmer selling and bear spreading weighed on the nearby end of the corn futures market which turned lower from overnight strength on slower than anticipated planting progress. The slower planting progress helped support new crop futures.

  • Like corn, the soybean market saw a fair amount of bear spreading which supported the new crop end of the futures market due to the slower than expected planting pace, with nearby old crop contracts showing small losses.

  • Soybean meal and oil also reversed directions with oil gaining on meal as traders likely booked profits and covered some recent long meal, short oil positions. The net changes in both products largely offset each other with little net affect on nearby Board crush margins or soybeans.

  • All three wheat classes saw lower closes with bear spreading noted in both Chicago and KC where the nearby contracts lost to the deferreds. Rain in dry HRW areas and lower Matif wheat may have triggered profit taking from the recent rally, as winter wheat good to excellent ratings increased 1%.  

  • To see the updated US 5-day precipitation forecast, the US 6 – 10 day Temperature and Precipitation Outlooks, as well as the 1-week total precipitation for Brazil and N. Argentina, courtesy of NOAA, NWS, and CPC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Despite July ’24 corn rallying beyond the congestion range on the front-month continuous charts, the market exhibits signs of being overbought, potentially adding resistance to higher prices. However, managed funds have retained a significant net short position, likely sparking the recent rally which could fuel a more substantial upside move as we progress through planting and into the growing season. Despite potential obstacles, 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:

  • Front end corn futures reversed lower from overnight strength as increased producer selling in the US and South America may have limited gains.  A slower than anticipated planting pace supported new crop futures as bear spreading was evident across grain markets on Tuesday, with deferred contracts gaining on the nearby.

  • The USDA reported crop progress and planting pace on Monday afternoon. US corn planting slowed last week due to wet weather as only 36% of the crop was planted as of Sunday. This was up 9% from last week and below market expectations. The 5-year average was at 39%, and with only 36% of the crop planted, 2024 has become the third slowest planting pace over the last 10 years. Only 2019 and 2022 were slower.

  • The planting pace will continue to struggle as another weather system moves across the Corn Belt this week. The forecast is showing a break in the weather in the middle of the month, but expectations are for a warm and wetter forecast into the end of May.

  • The USDA will release the next WASDE report on Friday morning. The May report will give the market its first estimates for the 24/25 marketing year and updates for the current marketing year.  Old crop corn carryout is expected to decrease slightly, but 24/25 will likely show the potential for large production and increased carryout year over year.

Above: July corn pierced the 200-day moving average and closed above 460 resistance, opening the door for a potential run toward the 495 – 510 resistance area. The market is showing signs of being overbought, which can be an obstacle to a higher move while adding fuel to any decline. To the downside, initial support may be found between 445 and 435, with greater support down near 421.

Above: Corn percent planted (red) versus the 10-year average (blue) and last year (purple).

Soybeans

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:

  • Soybeans ended the day mixed in bear spreading trade which saw the front months slightly lower but gains in the deferred months. Prices were likely correcting a bit after the recent rally and ahead of the USDA report on Friday. Soybean meal finished the day lower while soybean oil was higher. Since May 1, funds are estimated to have short covered 35,500 contracts of soybeans.

  • Yesterday’s Crop Progress report showed that the soybean crop is 25% planted which was below the trade estimate of 28% and compares with 18% last week. Soybean plantings are still above the 5-year average of 21% but could slip if progress is stalled again this week. 9% of the crop has emerged.

  • Early trade estimates for Friday’s USDA report have the 23/24 soybean ending stocks relatively unchanged, and the ending stocks for 24/25 are estimated at 439 mb, using a soybean yield of 52.0 bpa. The Argentinian bean crop is expected to be revised lower to 49.7 mmt from 50 mmt, and Brazil’s production is expected to be lowered to 152.5 mmt from 155 mmt last month.

  • The flooding in Rio Grande do Sul has had a large impact on this rally and has now been declared a state of emergency. The flooding has specifically benefitted soybean meal as Brazil typically exports a portion of its bean crop to Argentina to be crushed. The flooding comes after a season that suffered through drought conditions as well further impacting yields in those areas.

Above: A close above the 1248 late January high opens the door for the market to target the 1290 ¾ – 1296 ¾ gap, and then the 1328 – 1352 resistance area.  A slide back lower may encounter support in the congestion area between 1192 and 1146, with key support near the February low of 1128 ¼.

Above: Soybeans percent planted (red) versus the 10-year average (blue) and last year (purple).

Wheat

Market Notes: Wheat

  • After a few strong sessions, wheat, along with the rest of the grain complex, took a breather with lower closes in all three classes. Bear spreading was noted in Chicago and KC wheat, in which nearby contracts were under heavier selling pressure compared to deferred. This could be a result of profit taking after the strong rally, with the recent rains throughout the nation’s midsection. Matif wheat futures closed marginally lower today as well, offering no support to the US market.

  • On yesterday afternoon’s Crop Progress report, the USDA said that the winter wheat condition improved 1% to 50% good to excellent. Looking at the breakdown, SRW wheat is rated 74% GTE, while HRW is only 45% GTE. Additionally, spring wheat planting went from 34% complete a week ago to 47% done this week. This is well above last year’s 21% and the 5-year average at 31%.

  • The weather forecast for southwest Russia and eastern Ukraine could feature a hard freeze later this week which may provide some support to wheat. Black Sea wheat is still the world’s cheapest, but with Russian export values said to be firming, it could lead to more competitive US exports.  

  • According to Stats Canada, Canadian wheat stocks at the end of March totaled 11.756 mmt. This was below the expectations for a 12.2 mmt figure, but this is also well below 13.9 mmt last year. Excluding durum wheat, the stocks total 10.1 mmt. This adds to the overall bullish picture for wheat futures.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, fueled mostly by Managed fund short covering, HRW crop concerns, and dryness in southern Russia, that took it through the major moving averages on the continuous chart, and towards last December highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a net short position that has the potential to drive an extended short covering rally should these 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.

  • Grain Market Insider sees a continued opportunity to sell another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs, as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and close below 593 ½ may encounter support around the 50-day moving average (568) with 548 support below that.

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 since last December. 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: The May 6 close above the 664 and the 200-day average opens the door for the market to make a run toward psychological resistance near 700, with additional resistance above there around 722. If the market reverses lower, initial support may come in near 623 and again near 600.

Above: Winter wheat condition percent good-excellent (red) versus the 10-year average (blue) and last year (pink).

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.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: While the close above 712 in the July contract puts the market on track to continue toward the November high of 752, it could still face resistance in the 725 – 735 area. The close above 712 also puts the market solidly in overbought territory and at risk of a downturn. Should this occur, initial support may come around 690, with further support between 675 and 660.

Above: 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.

Above: Brazil and N. Argentina 1-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.

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5-6 End of Day: Positive Money Flow and Likely Short Covering Leads Beans and Wheat Sharply Higher

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • At the open of today’s day session, the corn market quickly transitioned from negative to positive, with July corn closing just a penny off the high. Managed funds likely covered more short positions, supported by money flowing into the commodity markets and big positive moves in wheat and soybeans.

  • July beans settle at their highest level since January after 4 consecutive higher closes as traders likely cover short positions.

  • Soybean meal and oil added additional support to soybeans as they both closed sharply higher today and pushed July Board crush margins 8 ½ cents higher. Harvest delays in Argentina and flooding in S. Brazil both contributed to the rally.

  • Following a weak start to the day due to more than expected rain in the southwestern Plains, all three wheat classes rebounded to settle sharply higher, supported by higher soybeans and dry conditions in the Black Sea region. July Chicago wheat posted its highest close since last December, while July KC posted its highest close since November.

  • To see the updated US 5-day precipitation forecast, the US 6 – 10 day Temperature and Precipitation Outlooks, as well as the 1-week total precipitation for Brazil and N. Argentina, courtesy of NOAA, NWS, and CPC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Although July ’24 corn has rallied beyond the congestion range on the front month continuous charts, it remains below its high of 460 that was posted on March 28. With little fresh bullish fundamental news, managed funds have maintained a significant net short position. While the fund’s large net short position likely sparked the recent rise in prices and could fuel a more significant upside move as we move through planting and into the growing season, the market now shows signs of being overbought, which could add resistance to higher prices. Despite potential obstacles along the way, overall market conditions and seasonal tendencies 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 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:

  • Strong money flow into the grain markets helped to lift corn futures higher on the session. July corn futures closed at their highest point since January 12 as funds continued to cover short positions.

  • On last week’s Commitment of Traders report, managed money reduced their net short position to 218,040 contracts, reduced by 20,506 contracts from last week as of April 30. With the recent price action, estimates will have funds under 200,000 short contracts and challenging the lowest net short since the start of the year.

  • The USDA will release its next estimate of planting pace this afternoon. Expectations for corn planting are to be 39% complete as of May 5. This would be up 12% from last week, and in line with the 5-year average.

  • Weekly export inspections showed good movement for corn exports last week. The USDA inspected 50.8 mb (1.286 mmt) of corn for shipment last week. Total inspections are now at 1.299 billion bushels, up 33% over last year, while the USDA is forecasting a 26% year-over-year increase.

  • Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May. The recent 6–10 day forecast is showing a drier than normal pattern going into the middle of the month. Dry weather would be helpful in keeping the planting pace on target after an overall wet couple of weeks in the Corn Belt.

Above: July corn pierced the 200-day moving average and closed above 460 resistance, opening the door for a potential run toward the 495 – 510 resistance area. The market is showing signs of being overbought, which can be an obstacle to a higher move while adding fuel to any decline. To the downside, initial support may be found between 445 and 435, with greater support down near 421.

Above: Corn Managed Money Funds net position as of Tuesday, April 30. Net position in Green versus price in Red. Managers net bought 20,506 contracts between April 24 – 30, bringing their total position to a net short 218,040 contracts.

Soybeans

Soybeans Action Plan Summary

In mid to late April soybeans posted an intermediate low and a bullish reversal with some subsequent short covering which rallied the market back toward early April’s congestion area. While that initial rally was limited, and the current supply/demand situation remains somewhat bearish, Managed funds remain short about 149,000 contracts according to the latest Commitment of Traders report. This could still fuel an extended short covering rally should any production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to revisiting recent lows throughout the spring.

  • 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:

  • Soybeans closed sharply higher again to kick off the week and have now posted 4 consecutively higher closes with the July contract gaining a whopping 85 ¾ cents since just last Wednesday. Both products closed higher but soybean meal was the clear leader with gains of over 4% as South American flooding threatens yields.

  • In Brazil, the last of the soybeans left in the field are deteriorating as heavy flooding disrupts harvest in Rio Grande do Sul. Reuters has estimated that Brazil’s total soybean production could fall by as much as 15% in that state for a total production of 19 to 20 mmt where the previous estimates had been closer to 22 mmt.

  • Today’s soybean export inspections were within the range of trade guesses at 12.8 mb for the week ending Thursday, May 2. This was greater than last week’s inspections but still put the total for 23/24 at 1.438 billion bushels, which is down 18% from the previous year. The USDA is estimating total soybean exports at 1.700 bb for 23/24 which would be down 15% from last year, but that number could change in Friday’s Supply and Demand report.

  • Friday’s CFTC report surprisingly showed funds as net sellers of 222 contracts of soybeans as of April 30, which increased their net short position to 149,236 contracts. It should be noted that the more significant rally came the following day with the July contract gaining 37 ¾ cents on the week.

Above: A close above the 1248 late January high opens the door for the market to target the 1290 ¾ – 1296 ¾ gap, and then the 1328 – 1352 resistance area.  A slide back lower may encounter support in the congestion area between 1192 and 1146, with key support near the February low of 1128 ¼.

Above: Soybean Managed Money Funds net position as of Tuesday, April 30. Net position in Green versus price in Red. Money Managers net sold 222 contracts between April 24 – 30, bringing their total position to a net short 149,236 contracts.

Wheat

Market Notes: Wheat

  • Despite a weaker start to the session, possibly influenced by rains in the southwestern Plains, all three US wheat classes closed sharply higher. Support came from the surging soybean market and expectations of continued dry weather in Russia and Ukraine. Additionally, Paris milling wheat futures saw a significant jump, with the September contract gaining 10.25 euros per metric ton, marking its highest level since mid-September 2023.

  • Weekly wheat inspections at 11.8 mb bring total 23/24 inspections to 634 mb, which is down 7% from last year. Inspections are currently behind the pace to meet the USDA’s goal. There will need to be about 55 mb more wheat exports in May to reach the USDA’s 710 mb export goal.

  • IKAR has reportedly lowered their estimate of Russia’s wheat crop by 2 mmt to 91 mmt. There is talk that there may be a further decline to 90 mmt. And with dry weather anticipated to continue into mid-May, there may be cuts to both Russian and Ukrainian wheat production down the road. In addition, IKAR has also said that the Russian wheat export values rose by four dollars last week to $216 per mt.

  • Managed funds bought back a signification amount of wheat last week. The combined short position in all three US classes now totals only 87,000 contracts. This is the smallest net short position since September of last year. Between April 23 and 30, their short position in Chicago wheat, in particular, declined by about 37%, from just over 76K contracts to just under 48K.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, likely fueled by Managed fund short covering and HRW crop concerns, that took it through the major moving averages on the continuous chart, and towards last December’s highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a net short position that has the potential to drive an extended short covering rally should any crop more concerns arise as we enter the more dynamic 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. 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.

  • Grain Market Insider recommends selling another portion of your estimated 2025 SRW wheat production. Since our last sales recommendation for next year’s SRW wheat crop, July ’25 Chicago has rallied over 70 cents and is approaching the 62% retracement level from the March low back to contract highs as Managed funds cover their extensive net short positions on world production concerns for this year’s crop. While plenty of time remains for other bullish factors to enter the scene that could push prices further, this rally may primarily be weather driven and short-lived, and we advise you to take advantage of these elevated prices to sell another portion of your estimated 2025 SRW production.

To date, Grain Market Insider has issued the following Chicago wheat recommendations:

Above: Support near the 200-day moving average has held, and the close above 633 ¼ opens the door for the market to test the area of 664 and then 684 as it moves toward the July high of 777 ¼. A slide lower and close below 593 ½ may encounter support around the 50-day moving average (567) with 548 support below that.

Above: Chicago Wheat Managed Money Funds net position as of Tuesday, April 30. Net position in Green versus price in Red. Money Managers net bought 28,318 contracts between April 24 – 30, bringing their total position to a net short 47,866 contracts.

KC Wheat Action Plan Summary

Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590’s on the topside and mid 550’s 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 since last December. Although low world export prices continue to be a drag on US demand and 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: The May 6 close above the 664 and the 200-day average opens the door for the market to make a run toward psychological resistance near 700, with additional resistance above there around 722. If the market reverses lower, initial support may come in near 623 and again near 600.

Above: KC Wheat Managed Money Funds net position as of Tuesday, Apr. 30. Net position in Green versus price in Red. Money Managers net bought 18,598 contracts between Apr. 24 – 30, bringing their total position to a net short 29,610 contracts.

Mpls Wheat Action Plan Summary

Between mid-February and much of April Minneapolis wheat traded mostly sideways to lower with little bullish fundamental news to drive prices higher. In late April, driven by world wheat crop concerns and dryness in the HRW growing areas, and fueled by likely Managed fund short covering, Minneapolis wheat rallied back toward the January highs. Although bullish fundamentals remain scarce, and the market shows signs of being overbought, historical seasonal trends typically strengthen as we approach late spring and early summer. Furthermore, Managed funds still hold a net short position that could fuel an extended rally if more production concerns arise.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: While the close above 712 in the July contract puts the market on track to continue toward the November high of 752, it could still face resistance in the 725 – 735 area. The close above 712 also puts the market solidly in overbought territory and at risk of a downturn. Should this occur, initial support may come around 690, with further support between 675 and 660.

Above: Minneapolis Wheat Managed Money Funds net position as of Tuesday, Apr. 30. Net position in Green versus price in Red. Money Managers net bought 15,262 contracts between Apr. 24 – 30, bringing their total position to a net short 9,294 contracts.

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.

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5-3 End of Day: South American Rains and Lower Russian Wheat Estimates Likely Spark More Short Covering

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Carryover strength from neighboring soybeans and wheat lent support to July corn futures which closed fractionally higher at its 100-day moving average after trading up to resistance and fading at midday.

  • Continued production concerns in South America kept soybean meal and soybeans on an upward trajectory going into the weekend. Another day of sharp gains in meal lent support to soybeans which likely experienced additional short covering by the Managed funds. July meal had its highest close since early January.

  • Soybean oil on the other hand consolidated for the third consecutive day, held back again by lower world veg oil prices and slowing demand for biofuel use.

  • Reduced Russian wheat production and export estimates by IKAR, along with dryness in Australia and higher Matif wheat, likely triggered more short covering in the wheat complex. July Chicago and KC contracts both rallied sharply before hitting resistance near their respective 200-day moving averages and settling below. Minneapolis, on the other hand settled with modest gains, mid-range, after trading both sides of unchanged.   

  • To see the updated US 5-day precipitation forecast, the US 6 – 10 and 8 – 14 day Temperature and Precipitation Outlooks, as well as the 1-week total precipitation for Brazil and N. Argentina, courtesy of NOAA, NWS, and CPC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Although July ’24 corn has rallied beyond the congestion range on the front month continuous charts, it remains below its high of 460 that was posted on March 28. With little fresh bullish fundamental news, managed funds have maintained a significant net short position. While the fund’s large net short position likely sparked the recent rise in prices and could fuel a more significant upside move as we move through planting and into the growing season, the market now shows signs of being overbought, which could add resistance to higher prices. Despite potential obstacles along the way, overall market conditions and seasonal tendencies 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 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:

  • Corn futures faded off early session strength but finished mostly higher on the session to end the week. Strong buying in both the wheat and soybean markets supported corn futures. For the week, the July corn futures traded higher for the second consecutive week gaining 10 ¼ cents, and the highest weekly close since January.

  • The Buenos Aires Exchange cut its projection for the Argentina corn production estimate to 46.5 mmt from 49.5 mmt. This newest projection is down 10 mmt from the early season estimate. Final production of corn in Argentina has been impacted by insect, disease, and weather damage.

  • Weather conditions in southern Brazil remain a concern with heavy rain and flooding impacting corn and soybean harvest in the region. Central Brazil is trending drier with high temperatures, which could pressure the development of the second (safrinha) crop corn.  These concerns have added some weather premium into the corn market this week.

  • Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May. Corn planting is off to a good start, but forecasted rains could push overall progress to delayed or late.

  • Managed money is still estimated to hold a large net short position in the corn market. The concerns this week have helped trigger a short covering rally. The weekly Commitment of Traders report later this afternoon will give a clearer picture regarding the money flow in the corn market.

Above: July corn pierced the 200-day moving average and closed above 460 resistance, opening the door for a potential run toward the 495 – 510 resistance area. The market is showing signs of being overbought which can be an obstacle to a higher move while adding fuel to any decline. To the downside, initial support may be found between 445 and 435, with greater support down near 421.

Soybeans

Soybeans Action Plan Summary

In mid to late April soybeans posted an intermediate low and a bullish reversal with some subsequent short covering which rallied the market back toward early April’s congestion area. While that initial rally was limited, and the current supply/demand situation remains somewhat bearish, Managed funds remain short about 149,000 contracts according to the latest Commitment of Traders report. This could still fuel an extended short covering rally should any production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to revisiting recent lows throughout the spring.

  • 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:

  • Soybeans ended the day sharply higher for the third consecutive day with the July contract up 52 cents and November up 41 ½ cents since Wednesday. Soybean meal has been the driver behind the gains in soybeans with another higher close today although soybean oil ended the day lower. Issues with harvest in South America have provided support.

  • For the week, July soybeans gained 37 ¾ cents ending at 1215, November soybeans gained 26 ¼ cents to 1201, July soybean meal gained a whopping $27.50 for $372.20, and July soybean oil lost 2.46 cents closing at 43.08 cents. Soybean meal has been the clear leader as major harvesting delays in Argentina due to excessive rains threaten yields and therefore soybean meal exports.

  • In Brazil, the last of the soybeans left in the field are deteriorating as heavy flooding disrupts harvest in Rio Grande do Sul. Reuters has estimated that Brazil’s total soybean production could fall by as much as 15% in that state for a total production of 19 to 20 mmt where the previous estimates had been closer to 22 mmt.

  • This week’s export sales report was relatively poor for soybeans at 15.5 million bushels and export shipments at 9.9 mb, but this morning, private exports reported to the USDA a flash sale of 122,000 metric tons of soybeans for delivery to unknown destinations during the 23/24 marketing year.

Above: The May 2nd close above 1191 ¾ resistance opened the door for the market to make a run toward and test resistance around the 1227 March high. A close above there could lead to a test of the January high around 1248. Initial support below the market remains between 1145 and 1140, if prices slide back toward key support and the February low of 1128 ½.

Wheat

Market Notes: Wheat

  • Wheat closed sharply higher in both the Chicago and Kansas City classes, with Minneapolis posting more modest gains. Today’s drop in the US Dollar Index was supportive, while fund short covering is likely the main driver of the market’s current momentum. Concerns regarding dryness in Russia and Australia, along with the worst flooding in southern Brazil since 1941, have all lent support to the wheat market.

  • Paris milling wheat futures surged higher today, helping the US market. The September contract gained 7.25 Euros to 235.00, closing well above the 200-day moving average. Prior to breaking through this resistance last week, it has not traded above that average since July of last year.

  • This week, rains in Russian wheat growing areas were less than expected. This is causing production concerns and adding support to futures pricing. IKAR reportedly decreased their Russian wheat production estimate by 2 mmt to 91 mmt, while also reducing their export estimate by 1.5 mmt to 50.5 mmt. For reference, the USDA is using a figure of 91.5 mmt of production with exports at 52 mmt.

  • Wheat planting continues to move forward in Australia, but more moisture is needed. The hope is that the transition from El Nino to La Nina will bring rain to recharge the soils. Friday and Saturday storms should bring precipitation to eastern regions, but the area may be limited to the northern part of New South Wales.

  • From a technical point of view, the July contracts of both Chicago and KC futures ran into resistance at their 200-day moving averages again. After rallying above that level for the second time in as many weeks, both classes closed below it today, and it may take more friendly news to see wheat rally significantly above these levels.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, likely fueled by Managed fund short covering and HRW crop concerns, that took it through the major moving averages on the continuous chart, and towards last December’s highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a large net short position that has the potential to drive an extended short covering rally should any crop more concerns arise as we enter the more dynamic 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. 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. 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: After failing to close above the December high of 630, Chicago wheat retreated and found initial support near the 200-day moving average. If initial support holds, and the market turns back higher, a close above the recent 633 ¼ high could open the door for a test of 664 resistance. Otherwise, if prices retreat, initial support is likely around 575 and the 50-day moving average.

KC Wheat Action Plan Summary

Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590’s on the topside and mid 550’s 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 since last December. While low world export prices continue to be a drag on US demand and prices, and it is likely that Managed funds covered a significant portion of their net short positions, it is also quite possible that they remain short the market. Which could still push prices higher if production concerns persist.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2023 HRW wheat production. Dryness in the Southwestern Plains and Russia, along with elevated geopolitical tensions in the Middle East and Black Sea spurred Managed funds to cover some of their extensive short positions in the wheat complex. As a result, the July ’24 KC wheat futures contract is about 50 cents higher than our previous old crop sales recommendation, and near both the 200-day moving average and the resistance area of last December’s highs. Considering this rally may primarily be weather driven and could be short-lived, as well as being limited on time before the 2024 crop is harvested, we advise you to take advantage of these elevated prices to sell another portion of your 2023 HRW wheat inventory.

  • 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: Even though initial support below the market between 620 and 625 remains intact, July KC wheat continues to struggle to close above the 200-day moving average. A close above the recent high of 664 may open the door for the market to test the 678 – 700 area. While a close below 620 may put it on track to test support near the 100-day moving average and the broad support area of 605 – 551.

Mpls Wheat Action Plan Summary

Between mid-February and much of April Minneapolis wheat traded mostly sideways to lower with little bullish fundamental news to drive prices higher. In late April, driven by world wheat crop concerns and dryness in the HRW growing areas, and fueled by likely Managed fund short covering, Minneapolis wheat rallied back toward the January highs. Although bullish fundamentals remain scarce, and the market shows signs of being overbought, historical seasonal trends typically strengthen as we approach late spring and early summer. Furthermore, Managed funds quite possibly still hold a net short position, that could fuel an extended rally if more production concerns arise.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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: While the close above 712 in the July contract puts the market on track to continue toward the November high of 752, it could still face resistance in the 725 – 735 area. The close above 712 also puts the market solidly in overbought territory and at risk of a downturn. Should this occur, initial support may come around 690, with further support between 675 and 660.

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.

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5-2 End of Day: South American Harvest and Crop Concerns Rally Soybeans and Corn

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Overly wet conditions in Southern Brazil, combined with potential planting delays from additional wet weather in the Midwest, helped push July corn to close just at its highest level since February and just below its 460 March high.

  • Flooding in Brazil with continued rain in N. Argentina and frost concerns in S. Argentina drove soybean meal $15.90 higher, and likely triggered a round of short covering in July soybeans which closed at their highest level since late March.

  • Record census crush for March may have also helped beans rally, but soybean oil stocks in the same report also rose more than expected adding a bearish tilt to bean oil demand, which could negatively impact soybeans.

  • KC wheat led the wheat complex higher again. While forecasted rains for the dry areas of western KS and the TX and OK panhandles will be welcome, more will be needed to alleviate drought conditions. Moreover, rainfall in the Black Sea region has fallen short of initial expectations, exacerbating concerns in that area as well.

  • To see the updated US 5-day precipitation forecast, and US Drought Monitor maps depicting changes from last week and crop areas in drought, courtesy of NOAA, NWS, CPC, USDA and NDMC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Although July ’24 corn has rallied beyond the congestion range on the front month continuous charts, it remains below its high of 460 that was posted on March 28. With little fresh bullish fundamental news, managed funds have maintained a significant net short position. While the fund’s large net short position likely sparked the recent rise in prices and could fuel a more significant upside move as we move through planting and into the growing season, the market now shows signs of being overbought, which could add resistance to higher prices. Despite potential obstacles along the way, overall market conditions and seasonal tendencies 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 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:

  • Potential planting delays and wetness in Southern Brazil helped push corn futures higher on Thursday. July corn closed at its highest price level since early February.

  • Grain markets became concerned about current weather conditions in Brazil and Argentina.  Wet weather in Rio Grande Do Sol has damaged the late corn and soybean harvest, which triggered short covering in the soybean market. Central Brazil is trending drier with high temperatures, which could pressure the development of the second (safrinha) crop corn. With these concerns and a corn market holding a large net short position, a short covering rally was triggered on Thursday.

  • Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May. Corn planting is off to a good start, but forecasted rains could push overall progress to delayed or late.

  • Weekly exports sales for corn were within expectations. Last week, US exporters registered new sales of 29.9 mb (758,000 mt) of old crop corn and 1.3 mb (33,670 mt) for new crop. Japan was the largest buyer of US corn last week. Total corn sales commitments now total 1.840 billion bushels, up 23% from last year.

  • The strong closing and price action at the end of the session could trigger additional buying to start the overnight session. With the market holding a large short position, the possibility remains that price momentum could be turning higher in the short term.

Above: The corn market continues to struggle to rally with overhead resistance remaining around 460 in the July contract. A breakout above there could allow prices to test the 495 – 510 area. If prices break to the downside and close below 421, they could slide further to test 400 – 410 support.

Soybeans

Soybeans Action Plan Summary

In mid to late April soybeans posted an intermediate low and a bullish reversal with some subsequent short covering which rallied the market back toward early April’s congestion area. While that initial rally was limited, and the current supply/demand situation remains somewhat bearish, Managed funds remain short about 149,000 contracts according to the latest Commitment of Traders report. This could still fuel an extended short covering rally should any production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to revisiting recent lows throughout the spring.

  • 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:

  • Soybeans closed sharply higher today with the July contract breaking out of its recent sideways range and testing highs from early April. The November contract closed right below its 100-day moving average. The rally in soybeans today was fueled by a very significant jump in soybean meal which closed $15.90 higher in the July at $364.90, an increase of 4.56%. Soybean oil closed slightly lower.

  • Argentina and S. Brazil are currently dealing with continuous rains that have kept farmers out of the fields and unable to harvest the crop timely. In addition to the rains, temperatures are now forecast to drop in S. Argentina which could cause frost conditions and further damage the crop. This is supportive to soybean meal because Argentina is the number one exporter of the product and any threat to its production could lower Argentine exports giving the export business to the US.

  • Today’s export sales report showed an increase of 15.2 million bushels of soybean export sales for 23/24 and an increase of 0.3 mb for 24/24. This was within analysts’ expectations but was on the lower side of the trade range. Last week’s export shipments of 9.9 mb were below the 12.8 mb needed each week to meet the USDA’s estimates. Primary destinations were to Japan, Indonesia, and Mexico.

  • March census crush reported by US NASS yesterday afternoon came in at a record high for the month of March at 203.73 mb. While this was a new record, still showing strong domestic demand, the number was below the range of estimates. Bean oil stocks for the month of March were reported at 2.369 billion pounds, though lower than year ago levels, they were higher than trade expectations and are likely weighing on bean oil prices.

Above: The May 2nd close above 1191 ¾ resistance opened the door for the market to make a run toward and test resistance around the 1227 March high. A close above there could lead to a test of the January high around 1248. Initial support below the market remains between 1145 and 1140, if prices slide back toward key support and the February low of 1128 ½.

Wheat

Market Notes: Wheat

  • Wheat finished the session with modest gains when compared with the surging soybean market. After the reversal off the recent high, one must wonder if wheat would have had a positive close today if it weren’t for the soy rally. Today the US Dollar Index did fade to the lowest level in two weeks, which may have also helped support grain markets.

  • The USDA reported net sales cancellations totaling 0.7 mb of wheat for 23/24 and an increase in sales of 15.0 mb for 24/25. The cancellations are disappointing, however, last week’s shipments of 18.7 mb did exceed the 16.4 mb pace needed per week to reach the USDA export goal of 710 mb. Shipments now total 615 mb, which is up 2% from last year.

  • Western Kansas and the panhandles of Texas and Oklahoma are set to receive some rain, which should help ease the dry conditions there. Though this will bring relief, more moisture will be needed to eliminate drought conditions. According to the USDA 28% of the US winter wheat area is in drought as of April 30, a 2% improvement from last week’s 30%. However, the spring wheat area in drought increased 1% to 27% for the same period.

  • According to their supply minister, Egypt may import as much as 5.7 mmt of wheat during the 24/25 fiscal year (starting in July). Additionally, their current stocks are estimated to be sufficient for three months, with the government having purchased 1.1 mmt from domestic farmers since mid-April.

  • India is expected to face severe heat in May, according to their meteorological department. With talk that they will need to import wheat. Elsewhere, rains in southern Russia and parts of Ukraine this week have been less than anticipated. With expectations for a drier pattern to return, this may be supportive to the US futures market.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, likely fueled by Managed fund short covering and HRW crop concerns, that took it through the major moving averages on the continuous chart, and towards last December’s highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a large net short position that has the potential to drive an extended short covering rally should any crop more concerns arise as we enter the more dynamic 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.

  • Grain Market Insider sees a continued opportunity to sell the remaining, previously recommended July ’24 Chicago wheat 590 puts at current market prices, minus fees, and commission. Back in March Grain Market Insider suggested covering half of the originally recommended July ’24 Chicago wheat 590 puts when they were about double of the original entry price, and in April we recommended covering another 25% of the original position when support around 550 was uncovered. Given today’s market action, it appears that July ’24 Chicago wheat may have found support around the 200-day moving average on the continuous chart and considering that the July ’24 590 puts have done their job of protecting the value of unsold 2024 bushels, we recommend exiting any remaining put options.

  • 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: After failing to close above the December high of 630, Chicago wheat retreated and found initial support near the 200-day moving average. If initial support holds, and the market turns back higher, a close above the recent 633 ¼ high could open the door for a test of 664 resistance. Otherwise, if prices retreat, initial support is likely around 575 and the 50-day moving average (currently 564).

KC Wheat Action Plan Summary

Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590’s on the topside and mid 550’s 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 since last December. While low world export prices continue to be a drag on US demand and prices, and it is likely that Managed funds covered a significant portion of their net short positions, it is also quite possible that they remain short the market. Which could still push prices higher if production concerns persist.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2023 HRW wheat production. Dryness in the Southwestern Plains and Russia, along with elevated geopolitical tensions in the Middle East and Black Sea spurred Managed funds to cover some of their extensive short positions in the wheat complex. As a result, the July ’24 KC wheat futures contract is about 50 cents higher than our previous old crop sales recommendation, and near both the 200-day moving average and the resistance area of last December’s highs. Considering this rally may primarily be weather driven and could be short-lived, as well as being limited on time before the 2024 crop is harvested, we advise you to take advantage of these elevated prices to sell another portion of your 2023 HRW wheat inventory.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2024 HRW wheat production. Since the end of July, the wheat market has been in a downtrend with no significant selling opportunities, while many uncertainties remain that could drive prices even higher. The market is now approximately 90 cents off the March low and entering an area of heavy resistance that coincides with a 25% retracement of the recent downtrend back toward the July high. Grain Market Insider recommends taking advantage of this rally to make an additional sale on your 2024 crop.

  • 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: After failing to close above the 200-day moving average and posting a bearish reversal on April 29, the KC wheat market retreated and closed through 640 initial support. The market could now be on track to test support near the 100-day moving average (near 604) and the broad support area of 605 – 551. If prices turn back higher and close above 664, they could then run to test the 678 – 700 area.

Mpls Wheat Action Plan Summary

Between mid-February and much of April Minneapolis wheat traded mostly sideways to lower with little bullish fundamental news to drive prices higher. In late April, driven by world wheat crop concerns and dryness in the HRW growing areas, and fueled by likely Managed fund short covering, Minneapolis wheat rallied back toward the January highs. Although bullish fundamentals remain scarce, and the market shows signs of being overbought, historical seasonal trends typically strengthen as we approach late spring and early summer. Furthermore, Managed funds quite possibly still hold a net short position, that could fuel an extended rally if more production concerns arise.

  • No new action is recommended for 2023 Minneapolis wheat. Following the recent breakout to the upside and the subsequent rally off the April lows, we recommended making a sale to take advantage of the elevated prices. The current strategy is to look for an extension of the rally toward last December’s highs and target 725 – 750 to recommend additional 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 market’s test of the 700 – 712 area has put it into overbought territory and is at risk of falling back. Should this occur, initial support may come between 675 and 660, with further support down toward 632 and 625 ¼. Conversely, if prices close above 712 and continue toward the November high of 752, they may encounter more resistance between 725 and 735.

Other Charts / Weather

Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

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5-1 End of Day: Corn and Beans Settle Higher with a Wet Forecast Ahead

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • The corn market reversed itself to the upside after July corn took out yesterday’s low and pierced its 50-day moving average. The reversal higher may provide some support for tomorrow’s trade.

  • July soybeans saw choppy trade to close higher on the day with potential support from a wet forecast ahead and concern over planting delays.

  • Soybean meal gapped lower on the open of the overnight session and continued to trade lower on news that workers ended their strike in Argentina. Meanwhile bean oil recovered some of yesterday’s losses and closed higher after chopping sideways for much of the day.

  • KC wheat led the wheat complex lower again in today’s trade with little direction provided by either the US Dollar or Matif wheat. July KC wheat held support near its 20-day moving average, while July Chicago found support near its 100-day ma.

  • To see the updated US 5-day precipitation forecast, and US Seasonal Drought Outlook, courtesy of NOAA, NWS, NCEP and CPC scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Although July ’24 corn has rallied beyond the congestion range on the front month continuous charts, it remains below its high of 460 that was posted on March 28. With little fresh bullish fundamental news, managed funds have maintained a significant net short position. While the fund’s large net short position likely sparked the recent rise in prices and could fuel a more significant upside move as we move through planting and into the growing season, the market now shows signs of being overbought, which could add resistance to higher prices. Despite potential obstacles along the way, overall market conditions and seasonal tendencies 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 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:

  • Corn futures worked off session lows during the day to finish moderately higher. More importantly, the firm price action posted a price reversal on the charts, which could signal some follow-through strength into tomorrow’s session.

  • Despite being off to a strong start, the corn planting pace is expected to slow over the next couple weeks. Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May.

  • With producers busy in the fields, the cash market has improved, trying to pull bushels. In many areas, cash basis levels have improved. With the recent wetness, it will be more likely that we will see more corn movement into the cash market.

  • The USDA will release the weekly Export Sales report on Thursday morning. Expectations are for new sales to range from 650,000 – 1.3 mmt for the old crop and up to 300,000 mt for the new crop. US corn has remained competitive in the export market.

  • Ethanol production averaged 987,000 barrels/day last week, up 3.5% from the previous week and 1.1% over last year. Ethanol stocks are trending 9.1% below last year’s levels. Corn used for ethanol production last week totaled 97.97 million bushels, which was below the pace needed to reach the USDA marketing year target.

Above: The corn market continues to struggle to rally with overhead resistance remaining around 460 in the July contract. A breakout above there could allow prices to test the 495 – 510 area. If prices break to the downside and close below 421, they could slide further to test 400 – 410 support.

Soybeans

Soybeans Action Plan Summary

In mid to late April soybeans posted an intermediate low and a bullish reversal with some subsequent short covering which rallied the market back toward early April’s congestion area. While that initial rally was limited, and the current supply/demand situation remains somewhat bearish, Managed funds remain short about 149,000 contracts according to the latest Commitment of Traders report. This could still fuel an extended short covering rally should any production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to revisiting recent lows throughout the spring.

  • 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:

  • Soybeans rebounded today from lower trade this morning and ended with a higher close which was led by gains in soybean oil. There may have been some support in soybean futures due to reports of planting delays caused by excessive rains that may be an issue for two more weeks. Soybean meal finished the day lower as Argentina harvests their soy crop and prepares to start exporting meal.

  • In Argentina, there had been an ongoing strike by dock workers and others who are unhappy with newly elected president Milei about proposed labor reforms and income taxes. The strike had shut down a major port, but the strike was lifted which could have been the reason why futures were so much lower this morning before rebounding.

  • Later today, the Census Crush numbers will be released for March, and they are expected to show total crush at 205 million bushels which would compare to 193.9 mb the previous month. Soybean oil stocks are expected to increase to 2.350 billion pounds from 2.146 billion in February.

  • In South America, the Brazilian soybean harvest is estimated at 90% complete. Similar to Argentina, the southern region of Brazil is receiving too much rain and holding up harvest progress. Both southern Brazil and Argentina are expected to continue receiving rains throughout the week.

Above: Since posting a bullish reversal on April 19, the market has struggled to stay above 1190. A close above the April 24, 1191 ¾ high could allow the market to run and test the 1227 March high. Otherwise, support below the market remains between 1145 and 1140, if prices slide back toward key support and the February low of 1128 ½.

Wheat

Market Notes: Wheat

  • Wheat closed lower again today, with KC futures under the most pressure. Paris milling wheat futures did not provide any direction today, as the Matif market was closed for the May Day holiday on Wednesday. The US Dollar has also lacked direction after trading on both sides of unchanged; traders may have been positioning themselves ahead of the Fed comments this afternoon regarding interest rates.

  • There continues to be some rain in the forecast for drier areas of Russia, which may in part be weighing on US futures. Russian and Ukrainian FOB export values also continue to add pressure as they are the world’s cheapest offers. Ukraine is said to have exported 1.9 mmt of wheat in April despite the damage to infrastructure and logistic challenges.

  • According to the USDA’s Foreign Agricultural Service, Australia’s wheat production is expected at 25.8 mmt for the 24/25 season. That would be about 3% below the 10-year average, and exports are anticipated to drop by 2.5 mmt to 17.5 mmt as well.

  • From a technical perspective, July Chicago wheat held support today at the 100-day moving average, which is around 595 ½. A similar story can be said for July KC wheat, which rebounded just above the 10-day moving average at 621.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, likely fueled by Managed fund short covering and HRW crop concerns, that took it through the major moving averages on the continuous chart, and towards last December’s highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a large net short position that has the potential to drive an extended short covering rally should any crop more concerns arise as we enter the more dynamic 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.

  • Grain Market Insider recommends selling the remaining July ’24 Chicago wheat 590 puts at current market prices, minus fees, and commission. Back in March Grain Market Insider suggested covering half of the originally recommended July ’24 Chicago wheat 590 puts when they were about double of the original entry price, and in April we recommended covering another 25% of the original position when support around 550 was uncovered. Given today’s market action, it appears that July ’24 Chicago wheat may have found support around the 200-day moving average on the continuous chart and considering that the July ’24 590 puts have done their job of protecting the value of unsold 2024 bushels, we recommend exiting any remaining put options.

  • 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: After failing to close above the December high of 630, Chicago wheat retreated and found initial support near the 200-day moving average. If initial support holds, and the market turns back higher, a close above the recent 633 ¼ high could open the door for a test of 664 resistance. Otherwise, if prices retreat, initial support is likely around 575 and the 50-day moving average (currently 563).

KC Wheat Action Plan Summary

Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590’s on the topside and mid 550’s 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 since last December. While low world export prices continue to be a drag on US demand and prices, and it is likely that Managed funds covered a significant portion of their net short positions, it is also quite possible that 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.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2024 HRW wheat production. Since the end of July, the wheat market has been in a downtrend with no significant selling opportunities, while many uncertainties remain that could drive prices even higher. The market is now approximately 90 cents off the March low and entering an area of heavy resistance that coincides with a 25% retracement of the recent downtrend back toward the July high. Grain Market Insider recommends taking advantage of this rally to make an additional sale on your 2024 crop.

  • 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: After failing to close above the 200-day moving average and posting a bearish reversal on April 29, the KC wheat market retreated and closed through 640 initial support. The market is now on track to test support near the 100-day moving average (near 604) and the broad support area of 605 – 551. If prices turn back higher and close above 664, they could then run to test the 678 – 700 area.

Mpls Wheat Action Plan Summary

Between mid-February and much of April Minneapolis wheat traded mostly sideways to lower with little bullish fundamental news to drive prices higher. In late April, driven by world wheat crop concerns and dryness in the HRW growing areas, and fueled by likely Managed fund short covering, Minneapolis wheat rallied back toward the January highs. Although bullish fundamentals remain scarce, and the market shows signs of being overbought, historical seasonal trends typically strengthen as we approach late spring and early summer. Furthermore, Managed funds quite possibly still hold a net short position, that could fuel an extended rally if more production concerns arise.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2023 Spring wheat crop. Since the end of July, the wheat market has been in a downtrend due to lower world prices, with no significant rallies to take advantage of. While many unknowns remain that could move prices even higher, the market is now more than 50 cents off its low and entering an area of heavy resistance that coincides with a 23% retracement back to the July high. Grain Market Insider advises taking advantage of this rally, and these still historically good prices, to make an additional sale on your 2023 crop.

  • 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 market’s test of the 700 – 712 area has put it into overbought territory and is at risk of falling back. Should this occur, initial support may come between 675 and 660, with further support down toward 632 and 625 ¼. Conversely, if prices close above 712 and continue toward the November high of 752, they may encounter more resistance between 725 and 735.

Other Charts / Weather

Above: US 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

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4-30 End of Day: Overbought Conditions Bring Out Commodity Sellers on a Risk Off Day

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Despite the broader market selloff, July corn managed to find support near its 50-day moving average and stave off heavy losses with support from cash markets and the lack of deliveries on First Notice Day.

  • July soybeans faced significant pressure from both products in the day session after an overnight rebound attempt stalled at its 50-day moving average and led to its lowest close in over a week.

  • Lower palm oil due to weak export demand, and a year over year drop in bean oil usage for biofuel weighed heavily on soybean oil which closed at a fresh three-year low. Meal also closed lower, despite support from the strike and rainy conditions in Argentina.

  • Overbought conditions, along with lower Matif wheat and a higher US dollar brought the sellers out in the wheat complex. KC led the complex lower with its double-digit losses, while Minneapolis and Chicago both rebounded from their respective lows, with July Chicago finding support near its 100-day moving average.

  • To see the updated US 5-day precipitation forecast, US 6 – 10 day Temperature and Precipitation Outlooks, and 1-week precipitation forecast for Brazil and N. Argentina courtesy of NOAA and The Climate Prediction Center scroll down to the other Charts/Weather section.

Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.

Corn

Corn Action Plan Summary

Although July ’24 corn has rallied beyond the congestion range on the front month continuous charts, it remains below its high of 460 that was posted on March 28. With little fresh bullish fundamental news, managed funds have maintained a significant net short position. While the fund’s large net short position likely sparked the recent rise in prices and could fuel a more significant upside move as we move through planting and into the growing season, the market now shows signs of being overbought, which could add resistance to higher prices. Despite potential obstacles along the way, overall market conditions and seasonal tendencies 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:

  • Despite strong selling in other grain markets, corn futures only saw moderate losses, supported by firm cash markets and zero deliveries against the May futures contract with the arrival of First Notice Day.

  • The lack of deliveries may be reflective of the lack of farmers selling stored bushels. The cash basis market has been supportive of prices as producers have been more focused on planting the next crop versus marketing stored bushels. With more farmers out of fields this week due to wetness, the cash market may see more bushels moving in the days ahead.

  • Corn planting is still running well ahead of schedule as producers pushed to get acres planted before last week’s rain. The corn crop was 27% planted, up 15% from last week. This is also trending 5% above the 5-year average and 4% above last year. Strong progress was noted in western and southern parts of the Corn Belt last week.

  • The planting pace is expected to slow over the next couple weeks. Weather models are forecasting rounds of precipitation to push through the Corn Belt, which could limit planting until the middle of May.

  • Reports of strong farmer selling in Brazil and Argentina have been limiting the corn market’s rally potential. The movement of corn in South America is making more bushels available to the export market, which could limit US near-term export demand.

Above: The corn market continues to struggle to rally with overhead resistance remaining around 460 in the July contract. A breakout above there could allow prices to test the 495 – 510 area. If prices break to the downside and close below 421, they could slide further to test 400 – 410 support.

Above: Corn percent planted (red) versus the 10-year average (blue).

Soybeans

Soybeans Action Plan Summary

In mid to late April soybeans posted an intermediate low and a bullish reversal with some subsequent short covering which rallied the market back toward early April’s congestion area. While that initial rally was limited, and the current supply/demand situation remains somewhat bearish, Managed funds remain short about 149,000 contracts according to the latest Commitment of Traders report. This could still fuel an extended short covering rally should any production concerns arise in the coming weeks. Otherwise, if weather conditions cooperate and planting progresses without major issues, prices could remain susceptible to revisiting recent lows throughout the spring.

  • 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:

  • Soybeans finished the day sharply lower due to big losses in soybean oil for the second consecutive day. This morning, there were 533 soybean deliveries reported against the May contract and 2,101 deliveries against May soybean oil. Soybean meal was lower today as well but not by as much as soybean oil which lost over 3% as it followed palm oil lower.

  • Yesterday afternoon, the USDA released its Crop Progress report which showed that 18% of the soybean crop has been planted as of this past Sunday. This compares to 8% last week and the 5-year average of 10%. Progress was one point higher than the average trade guess.

  • In the eastern part of the Corn Belt, continuous rains are causing some planting delays that are expected to last until May 18. In Argentina, continuous rains are falling as well, which is keeping farmers out of the field and unable to harvest soybeans which could lead to lower total production if yields are impacted.

  • In South America, the Brazilian soybean harvest is estimated at 90% complete. Similar to Argentina, the southern region of Brazil is receiving too much rain and holding up harvest progress. Both southern Brazil and Argentina are expected to continue receiving rains throughout the week.

Above: Since posting a bullish reversal on April 19, the market has struggled to stay above 1190. A close above the April 24, 1191 ¾ high could allow the market to run and test the 1227 March high. Otherwise, support below the market remains between 1145 and 1140, if prices slide back toward key support and the February low of 1128 ½.

Above: Soybeans percent planted (red) versus the 10-year average (blue).

Wheat

Market Notes: Wheat

  • Wheat experienced a negative close across all three US futures classes, with KC contracts leading the way with double-digit losses. Additionally, lower Matif futures and a stronger US Dollar failed to offer any support, suggesting a risk-off session as numerous other commodities also closed lower. Equities mirrored this trend, with the Dow dropping over 400 points at the time of writing.

  • From a technical perspective, all three US wheat classes are either at or near overbought levels, signaling a potential correction to the downside. In particular, daily stochastics indicate potential sell signals, suggesting further downward momentum. However, July Chicago wheat managed to find support at its 100-day moving average (596) and closed above that level.

  • According to yesterday afternoon’s Crop Progress report from the USDA, winter wheat conditions fell by 1% to 49% rated good to excellent. Despite recent declines, conditions remain significantly better than a year ago and are the highest for this time of year since 2020. Additionally, 30% of the crop is now headed, marking an increase from 23% last year and 21% on average. The USDA also reported that 34% of the spring wheat crop is planted, a substantial jump from 10% a year ago and 19% on average.

  • Two vessels containing Russian wheat destined for Egypt are reportedly being held up in port by the Russian government, despite passing inspection by Egyptian officials. This news follows the delay of two vessels in March and early April.

  • Brazil’s wheat planted area may shrink this year after increasing by over 70% between 2019 and 2023. CONAB is anticipating a 4.7% drop in area compared to last season, citing uncertain weather, lower prices, and higher costs as contributing factors to the potential decline.

Chicago Wheat Action Plan Summary

After holding downside support near 550, Chicago wheat staged a rally, likely fueled by Managed fund short covering and HRW crop concerns, that took it through the major moving averages on the continuous chart, and towards last December’s highs. Although bearish fundamentals remain, and the market shows signs of being overbought which adds downside risk, Managed funds still hold a large net short position that has the potential to drive an extended short covering rally should any crop more concerns arise as we enter the more dynamic 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. Back in August we recommended buying July ’24 590 puts to prepare for further price erosion. Since then, we recommended exiting half of the original position to get closer to a net neutral cost, and then most recently, we recommended exiting another half of the remaining position to lock in further gains in case prices continue higher, leaving 25% of the original position in place. We continue to target a market rebound back towards 675 – 715 versus July ’24 futures before recommending any additional sales. As for the open July ’24 590 put position, we are looking for prices between 475 – 500 versus July ’24 futures to before we recommend exiting any of the last 25%.

  • 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: After failing to close above the December high of 630, Chicago wheat retreated and found initial support near the 200-day moving average. If initial support holds, and the market turns back higher, a close above the recent 633 ¼ high could open the door for a test of 664 resistance. Otherwise, if prices retreat, initial support is likely around 575 and the 50-day moving average (currently 563).

KC Wheat Action Plan Summary

Between the end of February and the middle of April, KC wheat was mostly rangebound between the mid 590’s on the topside and mid 550’s 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 since last December. While low world export prices continue to be a drag on US demand and prices, and it is likely that Managed funds covered a significant portion of their net short positions, it is also quite possible that they remain short the market. Which could still push prices higher if production concerns persist.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2023 HRW wheat production. Dryness in the Southwestern Plains and Russia, along with elevated geopolitical tensions in the Middle East and Black Sea spurred Managed funds to cover some of their extensive short positions in the wheat complex. As a result, the July ’24 KC wheat futures contract is about 50 cents higher than our previous old crop sales recommendation, and near both the 200-day moving average and the resistance area of last December’s highs. Considering this rally may primarily be weather driven and could be short-lived, as well as being limited on time before the 2024 crop is harvested, we advise you to take advantage of these elevated prices to sell another portion of your 2023 HRW wheat inventory.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2024 HRW wheat production. Since the end of July, the wheat market has been in a downtrend with no significant selling opportunities, while many uncertainties remain that could drive prices even higher. The market is now approximately 90 cents off the March low and entering an area of heavy resistance that coincides with a 25% retracement of the recent downtrend back toward the July high. Grain Market Insider recommends taking advantage of this rally to make an additional sale on your 2024 crop.

  • 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: After failing to close above the 200-day moving average and posting a bearish reversal on April 29, the KC wheat market retreated and closed through 640 initial support. The market is now on track to test support near the 100-day moving average (near 604) and the broad support area of 605 – 551. If prices turn back higher and close above 664, they could then run to test the 678 – 700 area.

Above: Winter wheat condition percent good-excellent (red) versus the 5-year average (green) and last year (pink).

Mpls Wheat Action Plan Summary

Between mid-February and much of April Minneapolis wheat traded mostly sideways to lower with little bullish fundamental news to drive prices higher. In late April, driven by world wheat crop concerns and dryness in the HRW growing areas, and fueled by likely Managed fund short covering, Minneapolis wheat rallied back toward the January highs. Although bullish fundamentals remain scarce, and the market shows signs of being overbought, historical seasonal trends typically strengthen as we approach late spring and early summer. Furthermore, Managed funds quite possibly still hold a net short position, that could fuel an extended rally if more production concerns arise.

  • Grain Market Insider sees a continued opportunity to sell a portion of your 2023 Spring wheat crop. Since the end of July, the wheat market has been in a downtrend due to lower world prices, with no significant rallies to take advantage of. While many unknowns remain that could move prices even higher, the market is now more than 50 cents off its low and entering an area of heavy resistance that coincides with a 23% retracement back to the July high. Grain Market Insider advises taking advantage of this rally, and these still historically good prices, to make an additional sale on your 2023 crop.

  • 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 market’s test of the 700 – 712 area has put it into overbought territory and is at risk of falling back. Should this occur, initial support may come between 675 and 660, with further support down toward 632 and 625 ¼. Conversely, if prices close above 712 and continue toward the November high of 752, they may encounter more resistance between 725 and 735.

Above: Spring wheat percent planted (red) versus the 10-year average (blue).

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.