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1-24 End of Day: Technical Buying and Short Covering Lead Wheat and Corn Higher

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • A strong wheat market and dry forecast for Argentina brought positive money flow into the corn market, which closed higher for the fifth day in a row despite weak ethanol production data.

  • Soybeans ended the day mixed, as strength from an announced stimulus to the Chinese economy gave way to selling pressure that was likely led by weakness in soybean oil. Bull spreading was also noted as end users seek coverage on light farmer selling.

  • Soybean oil sold off and settled significantly lower after hitting resistance at the 20-day moving average. Soybean meal on the other hand, closed higher on the day with continued strength on concerns over the hot and dry conditions forecast for the next ten days in Argentina.

  • All three wheat classes finished the day in positive territory with Chicago contracts leading the way. Technical trade above Chicago’s 50-day moving average likely spurred additional short-covering with additional strength possibly from the lower US dollar and Chinese economic stimulus measures.   

  • To see the updated US 6-10 day temperature and precipitation outlooks, and the 1-week percent of normal forecast total precipitation for Brazil and Argentina, courtesy of the National Weather Service, 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Positive money flow led by strength in the wheat market and some concerns regarding Argentina weather has helped the corn market trade higher for the 5th consecutive day. March corn gained 5 ¾ cents on the session and is now trading 16 cents off the January 18 low.

  • Weather forecasts in Argentina have turned hotter and drier going into February. The change in weather has been enough to trigger some short covering in an oversold market. Argentina is forecasted to produce a record corn crop this season after two years of drought.

  • Like corn, the wheat market has traded nicely higher over the past five sessions supported by a break in the US dollar, and short covering. Chicago wheat futures closed through some key technical barriers today and could leave room for additional upside that could support corn futures.

  • Ethanol production dropped 22.4% last week as snow and extreme cold temperatures limited grain movement affected overall production. Ethanol producers used 81.19 million bushels of corn last week, down significantly from the week prior, but cumulative corn usage is still on target to reach USDA targets.

Above: Since posting a low on January 18, March corn has traded higher from being oversold and appears on track to test nearby resistance around 460. If prices turn back lower, initial support on the downside remains near the recent low of 436 ¾, with the next major support level around 415.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans traded on both sides of unchanged today but ultimately closed mixed, with March slightly higher, May and July slightly lower, and November up a cent. March soybeans are up on the week so far by 27 cents after rebounding from oversold conditions with support from a dry 10-day Argentine forecast.

  • Soybean meal has been on a steady trend lower since November but appears to have found support near last June’s low of $355.00. Today, meal ended higher while soybean oil was lower despite gains in crude and palm oil. While crush margins have narrowed recently, they remain profitable to processors.

  • The Chinese government in an effort to boost their struggling economy has announce two rounds of stimulus over the past couple days. The potential help of stimulus has pushed some traders to cover short positions with the optimism that China may be looking into the US market for soybeans.

  • South American weather is mixed with the short-term forecast for Argentina on the dry side, but scattered showers are expected for Brazil. There is quite a bit of debate by private analysts about Brazil’s potential production with the lowest guess at 135 mmt but the general consensus is closer to 153 mmt, still below the USDA’s January estimate of 157 mmt.

  • Argentina weather forecasts have turned warmer and drier going into early February. Though Argentina is still forecasted to produce an above-average soybean crop, the weather concerns have triggered short covering in soybean meal, helping to support soybeans overall this week.

Above: After posting the 1201 low, short covering from oversold conditions has enabled March soybeans to rebound. Overhead resistance remains in the 1250 area and again near 1290. If prices turn lower, support comes in around 1200 and then near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • Wheat continues to recover, with Chicago posting double-digit gains at the close. There has not been much fundamental news to support this rally, which may indicate that funds are covering short positions on a technical bounce. However, there are a few supportive factors that may have helped; the US Dollar Index was down sharply today, and there is talk that China is trying to stimulate their economy (which may have a positive impact on the commodity complex).

  • In other global news, there is word that China is attempting to de-escalate Red Sea tensions. Exactly what this means is unclear. But if they succeed, it could mean that more vessels resume using the Suez Canal, which would lower freight costs.

  • According to their trade ministry, Iraq is expecting a wheat harvest exceeding 6 mmt. For reference, production in 2023 was 5.19 mmt. With domestic wheat consumption at 4.5 to 5.0 mmt annually, they may have a surplus if these projections are accurate.  

  • As of January 19, EU soft wheat exports totaled 17.4 mmt since the season began on July 1. Last year, exports for the same timeframe reached 18.8 mmt. North African countries were the leading export destinations, with Morocco in the lead at 2.42 mmt.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: Since uncovering support around 573, March Chicago wheat has rallied through both the 100 and 50-day moving averages and is on track to test the 620 – 625 resistance area. If prices turn back lower, initial support remains near 573, with the next major support level around 556.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: With little bullish news in the market, KC wheat has been drifting sideways to lower since the middle of December with the 50-day moving average acting as nearby resistance.  If bullish news does enter the scene to move prices higher, major resistance beyond the 50-day moving average lies between 650 and 678. Otherwise, major support below the market remains between 595 and 575.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 KC wheat. In early December the July ’24 contract posted a 70-cent rally mostly on short covering activity in the front month contracts. Since then, July ’24 has drifted lower as growing conditions have seen improvement. Still, much of the growing season remains, and managed funds continue to carry a significant short position in old crop. Even though bullish headwinds remain, this could fuel another short covering rally if any production concerns come to the forefront. Back in August, Grain Market Insider recommended buying Jul ’24 KC wheat 660 puts to protect the downside. As the market got further extended into oversold territory and July ’24 showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Grain Market Insider remains prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: Since the March contract closed below 700 support in early January, the 700 area has acted as resistance for the recent rally. If prices close above that area, the next areas of resistance may come in between 721 and 734. Otherwise, below the market support remains near 669.

Other Charts / Weather

Brazil 1-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.

Argentina 1-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.

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1-23 End of Day: Soybeans Recoup USDA Report Losses While Corn Consolidates

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Quiet two-sided trade kept the corn market in consolidation mode for the fourth day in a row with little news to sway the market significantly in either direction. As prices settled slightly weaker in the front months relative to the deferred.

  • Strength from soybean meal and oil, and poor early yields from Brazil’s soy harvest, helped to lead soybeans higher as they recovered the losses from the USDA’s January report and from being oversold.

  • Recent rains that could bring Australia’s wheat crop to 30 mmt, and a rise in the US dollar to 6-week highs, may have added resistance to the wheat complex. As the wheat complex closed the day mixed with KC leading the strength, while Chicago and Minneapolis lagged.

  • To see the updated US 7-day precipitation forecast, as well as the Brazil 2-week forecast total precipitation and GRACE-Based drought indicator, courtesy of the National Weather Service, Climate Prediction Center, 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • The corn market continued to consolidate for the fourth consecutive day, as it closed slightly higher following two-sided trade. Significant market news remains relatively quiet, nor have there been any new private corn export sales reported since last Tuesday, but buying strength in the soybean market did help keep a floor under corn futures during the session.

  • AgRural estimates Brazil’s first corn harvest to be 7.9% complete, as compared to 5.1% last week and 5.9% last year. The agency also estimates that seeding of the second (safrinha) corn crop is 4.9% complete versus 0.4% last week, and 1% last year.

  • A Brazilian crop watcher reduced its estimate of Brazil’s 23/24 corn production in its latest release, by 11% to 118.5 mmt. The reduction is likely due to delays in the soybean crop which would lead to a potential drop in planted area as planting of the second (safrinha) crop gets pushed back. The USDA currently estimates Brazil’s corn production at 127 mmt.

  • It is also estimated that if Brazil’s production does fall that much, it is possible that the country’s 23/24 exports could fall to 35 mmt from last year’s 56 mmt.  An export drop of 21 mmt for Brazil could open the door for increased US exports for the coming year.

  • US corn export prices are currently below both Brazil and Argentina through February, after which Argentina is more competitive.

Above: Earlier in January, March corn broke through 460 support, which is now nearby resistance, and retreated toward nearby support around 440. The market shows signs of being oversold, which can be supportive if bullish information enters the market. If prices break below 440, the next major support level comes in near 415. Overhead, if prices rally above 460, additional resistance may enter in between 470-480.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day significantly higher and are now 38 cents off last Thursday’s low. Support came from higher soybean meal and oil, and some of the early yields from the beginning of Brazil’s soy harvest that have come in poorly.

  • Over the next week, Argentina is expected to be relatively dry, but the good growing conditions they have had so far this season should keep the crop in good shape. Brazil is expected to receive scattered showers over the next week with some dryness in the western region of the country.

  • The big question over the next few months will be the size of South America’s total production as the USDA is likely forecasting Brazilian production too high but may be predicting Argentina’s too low. Their guess of 157 mmt for Brazil is above most analysts’ expectations which range between 150 and 155 mmt, with some much lower, but increases by Argentina could offset some of those losses.

  • Demand has been mixed with domestic crush very strong and December’s crush numbers breaking records, but export demand has been lagging with exports below last year by 20%. Crush margins have narrowed over the past few weeks, and the US’s export window for soybeans is nearing its end with South American harvest underway.

Above: After posting the 1201 low, short covering from oversold conditions has enabled March soybeans to rebound somewhat. Overhead resistance remains in the 1250 area and again near 1290. If prices turn lower, support comes in around 1200 and then near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • Wheat closed mixed amongst the three futures classes. Despite being about a dime higher at one point, March Chicago wheat settled unchanged, potentially pressured by another rise in the US Dollar Index. Some weakness may have also stemmed from recent rains in Australia that, according to some private estimates, may boost their crop to 30 mmt. For reference, the USDA is at 25.5 mmt.

  • According to the EU’s Monitoring Agricultural Resources unit, winter crops in northern European countries may experience damage due to a cold front. However, Russian wheat is said to be protected by thick snow cover, so not much damage is expected there.

  • The Canadian wheat production estimate for 24/25 is seen rising 4.2% to 33.3 mmt, according to an estimate from Agriculture and Agri-Food Canada (AAFC). While planted acreage is expected to be down slightly, yields are expected to be higher.

  • China has been encouraging hog producers to reduce capacity after farmers lost about eleven dollars per head on average. While this does not directly affect the wheat market, it is important to note that it may affect the commodity complex as a whole, especially if Chinese hog farmers require less feed grain. Additionally, as they try to become more self-sufficient, there are concerns that down the road China will import less grain in general.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: March Chicago wheat has been consolidating after uncovering initial support just below the market around 573. If that holds, the market may test resistance near the 50-day moving average, and again between 620 and 625, while heavy resistance remains near 650. If 573 does not hold, the market may run the risk of retreating and testing the next level of major support near 556.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: With little bullish news in the market, KC wheat has been drifting sideways to lower since the middle of December with the 50-day moving average (632) acting as nearby resistance.  If bullish news does enter the scene to move prices higher, major resistance beyond 632 lies between 650 and 678. Otherwise, major support below the market remains between 595 and 575.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 KC wheat. In early December the July ’24 contract posted a 70-cent rally mostly on short covering activity in the front month contracts. Since then, July ’24 has drifted lower as growing conditions have seen improvement. Still, much of the growing season remains, and managed funds continue to carry a significant short position in old crop. Even though bullish headwinds remain, this could fuel another short covering rally if any production concerns come to the forefront. Back in August, Grain Market Insider recommended buying Jul ’24 KC wheat 660 puts to protect the downside. As the market got further extended into oversold territory and July ’24 showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Grain Market Insider remains prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: Since the March contract closed below 700 support in early January, the 700 area has acted as resistance for the recent rally. If prices close above that area, the next areas of resistance may come in between 721 and 734. Otherwise, below the market support remains near 669.

Other Charts / Weather

US 7-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

Brazil 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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1-22 End of Day: Markets Settle Firm to Higher on Little Fresh News

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Two-sided choppy traded dominated the corn market in a tight 4-cent range with little fresh news to move prices significantly in either direction. Support spilled over from soybeans to help corn prices settle fractionally in the green, as prices continue to consolidate.

  • Solid weekly export inspections and a strong soybean oil market that posted a bullish reversal from Friday’s weakness lent support to soybeans, which closed higher for the third day in a row after testing 1200 support in the March contract.

  • Despite export inspections that came in on the low end of expectations, and weakness in Matif wheat futures. The wheat complex ended the day mostly firm but mixed with Chicago and Minneapolis mostly higher, while nearby KC settled weak relative to the deferred.

  • To see the updated US 7-day precipitation forecast, 8-14 day temperature and precipitation outlooks as well as the Brazil 2 week forecast total precipitation courtesy of the National Weather Service, 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Another quiet news day in the grain markets but buying strength in the soybean market did help pull corn futures slightly higher during the session. March corn gained ¼ cents on the day as prices have consolidated the past five sessions around the USDA report day low.

  • Weekly corn export inspections were within expectations at 28.1 mb (713,000 mt). Total inspections for the marketing are now at 579 mb, up 28% from last year. Corn inspections are running ahead of the USDA projections.

  • South American weather is looking to trend a little drier in southern areas, but overall weather patterns are staying favorable for crops.

  • Brazil’s soybean harvest is progressing ahead of average pace. Brazil’s soybean crop is estimated at 6% harvested, up from 1.8% last year. The key crop production state of Mato Grasso is nearly 13% complete. The early soybean harvest is allowing Brazil producers to begin planting of the key second crop corn in an earlier time window.

Above: Earlier in January, March corn broke through 460 support, which is now nearby resistance, and retreated toward nearby support around 440. The market shows signs of being oversold, which can be supportive if bullish information enters the market. If prices break below 440, the next major support level comes in near 415. Overhead, if prices rally above 460, additional resistance may enter in between 470-480.

Above: Corn Managed Money Funds net position as of Tuesday, January 16. Net position in Green versus price in Red. Managers net sold 29,819 contracts between January 10 – 16, bringing their total position to a net short 260,542 contracts.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day higher with the March contract now 23 cents off its low from last Thursday. Soybean meal continued its trek lower today, while soybean oil was supported from higher crude oil and palm oil.

  • Today’s export inspections were decent with 42.7 mb inspected for the week ending January 18. Total inspections are now at 983 mb for 23/24 which is down 22% from the previous year. No flash sales were reported today, but there was a large sale to China last Friday.

  • South American weather is forecast to be slightly drier over the next 10 days with the decline in precipitation mainly in Argentina and Brazil’s Mato Grosso do Sul. The majority of Brazil is expected to continue getting scattered showers as harvest begins.

  • Brazil is currently 6% complete with harvest which is up 2% from last week, and early yields have been poor, but the majority of this early harvested crop is the part that was under the most stress from dry and hot weather. More accurate yield estimates will not be available until harvest is further along.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Above: Soybean Managed Money Funds net position as of Tuesday, January 16. Net position in Green versus price in Red. Money Managers net sold 45,549 contracts between January 10 – 16, bringing their total position to a net short 76,797 contracts.

Wheat

Market Notes: Wheat

  • Despite a lack of fresh news, wheat was able to close mostly higher today following a day of two sided trade. This was also in the face of a mostly lower close for Matif wheat futures. With US futures at or very near oversold levels technically, this may indicate that the market has found a near term bottom. This marks the fourth higher session for March Chicago wheat.

  • Weekly wheat inspections totaling 11.6 mb bring the 23/24 total inspections to 394 mb, which is down 16% from last year. Inspections are also running behind the pace needed to meet the USDA’s 725 mb goal for 23/24 wheat exports.

  • According to the CFTC, as of January 16, managed funds were short 68,575 contracts of Chicago wheat. That is an addition of 10,587 contracts from the previous week, representing an 18.3% increase to their short position.

  • Due to the ongoing issues in the Red Sea, more and more European vessels transporting wheat are being re-routed to avoid using the Suez Canal. According to the World Trade Organization, shipments from Russia, Ukraine, and the EU using alternative routes have increased 42% by mid-January. This compares to just 8% in December.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: March Chicago wheat has been consolidating after uncovering initial support just below the market around 573. If that holds, the market may test resistance near the 50-day moving average, and again between 620 and 625, while heavy resistance remains near 650. If 573 does not hold, the market may run the risk of retreating and testing the next level of major support near 556.

Above: Chicago Wheat Managed Money Funds net position as of Tuesday, January 16. Net position in Green versus price in Red. Money Managers net sold 10,587 contracts between January 10 – 16, bringing their total position to a net short 68,575 contracts.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: With little bullish news in the market, KC wheat has been drifting sideways to lower since the middle of December with the 50-day moving average (632) acting as nearby resistance.  If bullish news does enter the scene to move prices higher, major resistance beyond 632 lies between 650 and 678. Otherwise, major support below the market remains between 595 and 575.

Above: KC Wheat Managed Money Funds net position as of Tuesday, January 16. Net position in Green versus price in Red. Money Managers net sold 4,426 contracts between January 10 – 16, bringing their total position to a net short 38,652 contracts.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: The breach of 700 in the March contract could indicate further weakness with the next area of major support down near 669. The market does show signs of being oversold, which is supportive if the market turns back higher. Overhead initial resistance lies around 700 and then again between 721 and 734.

Above: Minneapolis Wheat Managed Money Funds net position as of Tuesday, January 16. Net position in Green versus price in Red. Money Managers net sold 1,074 contracts between January 10 – 16, bringing their total position to a net short 29,711 contracts.

Other Charts / Weather

US 7-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

Brazil 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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01-19 End of Day: Corn and Wheat Rebound from Being Oversold on Solid Export Sales

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Export sales that exceeded the top end of expectations gave a lift to the corn market that has been in search of positive news. While the export news was positive and lent support to the front months, corn futures gave back much of the day’s gains, settling 4 cents off the high.

  • Pressured by weaker products, soybeans were unable to hang onto the gains from overnight, but held losses to a minimum, with solid export sales that came in within expectations, and the first flash sale in a month totaling 11.6 mb to China.

  • The losses in both soybean meal and oil (SMH down $4.80 and BOH down 0.72 cents) not only weighed on soybeans, but also Board crush margins. Though they remain profitable, margins dropped 18 ¼ cents in the March contracts, giving up nearly 75% of the year’s gains.

  • Weekly export sales for wheat were well above expectations and likely triggered some short covering ahead of the weekend. All three wheat classes ended the day in positive territory, with Chicago and Minneapolis closing in the upper end of their respective ranges.

  • To see the updated US 6-10 day temperature and precipitation outlooks as well as the Brazil 2 week forecast total precipitation courtesy of the National Weather Service, 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Corn futures finished mixed to slightly higher to end the week, as the March contract gained 1 ½ cents on the session. A better-than-expected week of export sales helped push corn markets higher to start the session, but selling pressure limited gains. For the week, March futures finished 3 cents lower and has traded lower for 6 consecutive weeks.

  • Weekly corn export sales were above the top end of analyst estimates at 49.3 mb (1.251 mmt) as sales improved after two weeks of holiday reduced trade. Total sales commitments are now at 1.241 bb for the 23/24 marketing year and up 36% from last year.

  • Mexico continues to be the largest buyer of US corn on the export markets, adding 637,000 mt of new sales last week. China was still absent from the export report for US corn, limiting buying support for the session.

  • China’s total corn imported for the 2023 calendar year reached 27.13 mmt, up 32% year over year.  December saw a large jump in corn imports at 4.950 mmt, up 471% year over year and a large supply of South American corn filled Chinese demand. The large December imports will likely limit China in the US corn export market until the summer months.

  • South America weather looks to maintain a favorable pattern for crop production in the near-term.  The improved weather overall should support a potential second Brazil corn crop and help maintain a forecasted record corn production from Argentina later this spring/summer.

Above: Earlier in January, March corn broke through 460 support, which is now nearby resistance, and retreated toward nearby support around 440. The market shows signs of being oversold, which can be supportive if bullish information enters the market. If prices break below 440, the next major support level comes in near 415. Overhead, if prices rally above 460, additional resistance may enter in between 470-480.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans began the day trading higher, with March beans up as much as 14 cents at one point, but faded throughout the day to end with a lower close. Both soybean meal and oil also faded throughout the day to a lower close. Lower crude oil and improved rainfall in Brazil has added to pressure in the soy complex.

  • For the week, March soybeans lost 11 cents, March soybean meal lost $5.60, and March soybean oil lost 1.35 cents. This was the fifth lower consecutive weekly close in soybeans, as non-commercials have established and continue to add to a net short position. There is some support at the 12-dollar level, but if that breaks, last year’s low is down at 1145 ¼.

  • Some encouraging news earlier in the day was the announcement of a large flash sale of 276,000 metric tons of soybeans for delivery to China in the 23/24 marketing year. Chinese imports from Brazil have slowed down, which points to US soybeans becoming more competitive with South America.

  • Today’s export sales report was also stronger than expected for soybeans, with an increase of 28.7 mb of export sales for 23/24 and an increase of 0.1 mb for 24/25. Last week’s export shipments of 61.4 mb were firmly above the 24.7 mb needed each week, and primary destinations were to China, Germany, and Mexico.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • Wheat was able to manage another close in positive territory. While a lower US Dollar Index helped today, the market may mainly be seeing more short covering by the funds, resulting from a technical correction of oversold conditions. March Chicago wheat, in particular, has had three higher sessions in a row.

  • The USDA reported an increase of 26 mb of wheat export sales for 23/24. Commitments at 592 mb for 23/24 are up 4% from last year. Although, shipments last week of 9 mb were below the pace needed each week of 16.6 mb to meet the USDA’s export goal of 725 mb.

  • Matif wheat futures settled with gains for the third consecutive session, which may be lending some support to US wheat, while also indicating that a near-term bottom may have formed.

  • Argentina’s wheat crop is reported to be 98% harvested, according to the Buenos Aires Grain Exchange. Their production estimate was kept unchanged at 15.1 mmt, which is well above last year’s 12.2 mmt total.

  • According to Strategie Grains, the EU 24/25 soft wheat production estimate was revised lower to 122.7 mmt. They also stated that poor weather conditions are expected to impact the wheat planting area, adding that the decline in production may be offset by a smaller amount of exports.

  • The US Climate Prediction Center has forecasted that the El Nino weather pattern will persist through the month of May. Afterwards, it is expected to transition to neutral (neither El Nino nor La Nina) into the US spring and summer. If true, this may indicate above normal temperatures February through April in the Great Lakes and northern Plains areas.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: The March contract’s closing through the bottom end of the recent range and 100-day moving average lends a bearish tilt to the market, which runs the risk of drifting lower toward the next major level of support near 556. If a bullish catalyst enters the market to turn prices higher, overhead resistance remains near 650.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: The breach of 700 in the March contract could indicate further weakness with the next area of major support down near 669. The market does show signs of being oversold, which is supportive if the market turns back higher. Overhead initial resistance lies around 700 and then again between 721 and 734.

Other Charts / Weather

Brazil 2 week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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01-18 End of Day: Grains Close Higher Across the Board for Just the 2nd Time in 2024

ByCarol Tillmann

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Corn prices traded higher today after four consecutive sessions lower, this higher close came despite lower week-over-week ethanol production. Continuous corn futures may be finding support this week from the 2015 and 2016 summer highs near the $4.40 futures level.

  • Soybean prices rallied late today from severely oversold levels after testing last week’s lows and the pivotal $12 level on front month March futures this morning.

  • Soybean meal held onto marginal gains today while soybean oil prices slid slightly lower, this came despite crude oil prices posting their highest close of 2024 this afternoon.

  • After trading to new lows this morning, all three wheat classes managed to close higher on the day, likely due to technical buying from extreme oversold levels. The US Dollar was higher yet again today continuing its 2024 rally.

  • To see the updated US Drought Monitor as well as the Brazil 1 week forecast total precipitation courtesy of the National Weather Service, 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Corn futures traded higher for the first time in four sessions as the March contract gained 1 ¾ cents on the day. Corn prices shook off a move to new life of contract lows early in the session to post a higher gain. 

  • Corn and grain markets in general are heavily oversold. The firming price action on the session posted a reversal on daily charts and could lead to additional technical strength going into the weekend on Friday.

  • Demand will stay a key focus of the market, and the USDA will release weekly export sales on Friday morning. US corn is moving into a typical window to see export demand as global supplies from competing nations are minimized. Last week’s export sales for corn were disappointing at 488,000 MT, which was at the low end of expectations.

  • The national average corn basis was improving over last week. Currently the National Average basis is trading at 24 cents, up from last week, but still below the 5-year average. Lack of producer selling is likely helping support basis levels.

  • Average ethanol production last week was 1.054 million barrels/day, down 0.8% from last week, but up 4.6% compared to last year. Ethanol stocks were 25.695 million barrels, which was an all-time high for the date. Total corn used to date for ethanol production totaled 1.987 billion bushels which running ahead of the needed pace to reach the USDA target for the marketing year.

Above: Earlier in January, March corn broke through 460 support, which is now nearby resistance, and retreated toward nearby support around 440. The market shows signs of being oversold, which can be supportive if bullish information enters the market. If prices break below 440, the next major support level comes in near 415. Overhead, if prices rally above 460, additional resistance may enter in between 470-480.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day higher after mixed trade that resulted in March soybeans, making a new low at $12.01 before rebounding at the close. The US Senate also passed a bill today to avert a government shutdown which likely supported the markets in general.

  • There have been no flash sales reported for soybeans in weeks as the world’s main buyer, China, seems to be stepping aside from even Brazilian purchases. Tomorrow’s export sales report for soybeans will likely show very weak sales and may pressure the soy complex.

  • Today, soybean meal closed slightly higher while bean oil was lower. Both soy products have been trending lower, but despite that, December’s NOPA crush report showed a record number of soybeans crushed which indicates that domestic demand at least is firm.

  • Last Friday, the USDA projected Brazilian soybean production at 157 mmt, and many analysts agree that this is too high. The majority are estimating production around 150 mmt, but some guesses have come in as low as 135 mmt. The actual numbers won’t start to roll in until combines roll in larger numbers within the next few months.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • After a rough morning of new lows, all three classes of US wheat reversed by the close to post session gains. KC wheat led the charge higher, gaining more than a dime in the front month March despite a lack of fresh news. This may be more of a technical correction than anything else, as wheat is very oversold. However, support also came from corn and soybeans turning higher.

  • The recent storms brought snow cover which should protect much of the winter wheat crop from another round of sub-zero temperatures expected to hit many areas of the Plains states and Midwest by this weekend. Additionally, soil moisture levels look much better than a year ago, so the crop should be in better shape as well.

  • According to StoneX, the Brazilian 23/24 wheat crop is estimated at 8.25 mmt, down from their previous estimate of 8.59 mmt. Additionally, Brazil is expected to import more wheat at 7.05 mmt vs 6.37 mmt previously.

  • Due to lower Chinese demand, as well as competition from the Black Sea region, French wheat exports for 23/24 are expected to drop according to FranceAgriMer. This includes declines both within and outside of the European Union.

  • Egypt purchased 360,000 mt of wheat in their tender with the majority coming from Russia. One cargo was sourced from France; however, this did not do much to help Matif futures which remain near contract lows. Like US wheat, that market is also very oversold technically, which could mean that the market is searching for a bottom.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: The March contract’s closing through the bottom end of the recent range and 100-day moving average lends a bearish tilt to the market, which runs the risk of drifting lower toward the next major level of support near 556. If a bullish catalyst enters the market to turn prices higher, overhead resistance remains near 650.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: The breach of 700 in the March contract could indicate further weakness with the next area of major support down near 669. The market does show signs of being oversold, which is supportive if the market turns back higher. Overhead initial resistance lies around 700 and then again between 721 and 734.

Other Charts / Weather

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01-17 End of Day: Weak Chinese Economic Data Presses Markets Lower

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Spillover weakness from soybeans and a stronger US dollar weighed on the corn market that set a new contract low, and low close for March corn.

  • Reports of a slowing Chinese economy and sharply lower soybean meal kept downward pressure on soybeans, which closed near the day’s lows following choppy trade that saw prices on both sides of unchanged.

  • Talk of increasing Argentine soybean production that could exceed 52 mmt weighed heavily on soybean meal, which closed the day forming a bearish reversal. Soybean oil, on the other hand, settled in the green after making a new low for the move, possibly with help from crude oil, which also rallied off its lows.

  • Unconfirmed rumors of Chinese vessels loading SRW wheat in the Gulf of Mexico may have added support to March Chicago wheat, which closed fractionally higher, while the complex as whole saw pressure from neighboring soybeans and a rising dollar to close mostly lower.

  • To see the updated GRACE-based drought indicator maps of the US and South America, courtesy of the NDMC and NASA, scroll down to 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

  • No new action is recommended for 2023 corn. Front month corn has languished in a sideways to lower trend since printing a high in October, with a general lack of bullish news and an estimated US carryout over 2.1 billion bushels. The failure of the USDA’s January report to provide the bullish news necessary to turn prices higher is disappointing and the market remains at risk of remaining in the same pattern. With that being said, the market does show signs of being oversold, and managed funds hold a sizable net short position, which could trigger a short covering rally if a bullish catalyst enters the scene. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Following the January USDA Supply and Demand update, Dec ’24 broke through the bottom end of the 485 ¾ to 602 range that had been in place since February ’22. While this is a disappointing development, bear spreading has allowed Dec ’24 to maintain more of its value versus old crop, as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Additionally, Dec ’24 does show signs of being oversold, which is supportive if a bullish catalyst enters the scene. Grain Market Insider continues to watch for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Disappointing price action in the corn market, as prices failed to hold the session highs and finished with losses. March corn established a new contract low and low close, losing 1 ¼ cents on the session.  Strong selling pressure in the soybean market and a surge higher in the US dollar weighed on corn prices on Tuesday. 

  • Technically, March corn futures failed to push back through the psychological 450 level, setting up the afternoon retest of the lows of the session. The negative price action and weak close will keep sellers active going into Thursday’s trade.

  • China reported weak GDP data overnight, which triggered selling pressure across the commodity sector. The Chinese economy grew 5.2% in the fourth quarter, which had analysts concerned about the overall Chinese economy. The slower growth rate weighed heavily on soybeans and the rest of the commodity markets for the early part of the session.

  • The soft price action showed that sellers are in control of the market, and any buying strength runs into selling pressure. Hedge Funds continue to push their large net short position in the corn market, now estimated to have over 250,000 contracts.

  • The US Dollar Index has rallied steadily since the first of the year. The Dollar Index traded to its highest level in six weeks at the 103-basis point level. The stronger dollar limits US competitiveness for grains and weighed on prices.

Above: Earlier in January, March corn broke through 460 support, which is now nearby resistance, and retreated toward nearby support around 440. The market shows signs of being oversold, which can be supportive if bullish information enters the market. If prices break below 440, the next major support level comes in near 415. Overhead, if prices rally above 460, additional resistance may enter in between 470-480.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout, and considering the bullish influence of adverse South American weather, which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day sharply lower following poor GDP data out of China and a lack of Chinese demand for soybeans. Soybean meal was the biggest loser of the day, but soybean oil managed to end the day slightly higher.

  • Yesterday, the NOPA crush report showed 195.33 million bushels of soybeans crushed in December, which was well above the average trade guess and a record for any month. The crush was up 10% year over year and up 5% from the prior December high. This should be supportive, but aggressive fund selling, and the South American harvest has pressured soybeans.

  • Chinese GDP data showed about 5% annual growth for 2023, but their economic recovery is still seen as uneven and concerning. Some analysts are predicting that the Chinese economy will see another slowdown later this year, which could impact imports of agricultural goods.

  • Soybean production in Brazil was estimated at 157 mmt by the USDA last week, but many analysts have that number at 150 mmt or below. The concerning thing has been the lack of soybean purchases by China from Brazil recently after China went on a buying spree last year.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • Wheat attempted a rally today, with March Chicago up over a dime at one point. This could be tied to unconfirmed rumors that there are ships in the US Gulf loading SRW wheat to deliver to China. However, March Chicago ended up closing just a half cent higher, while the rest of the wheat contracts in all three classes settled with losses for the day.

  • A combination of a higher US Dollar Index and sharply lower soybean futures likely weighed both wheat and corn today. Additionally, while about 20% of the US winter wheat crop was exposed to the recent cold temperatures, most are not expecting winterkill to be much of an issue. This may have offered some weakness to wheat, as there was some anticipation that crop damage would be a bullish factor.

  • As of January 14, EU soft wheat exports reached 16.88 mmt since the season began in July. This compares with 18.17 mmt for the same timeframe last year, representing a roughly 7% decline year over year.

  • According to FranceAgriMer, French soft wheat exports for 23/24 are estimated at 17.01 mmt, down from the previous estimate of 17.2 mmt. The stockpile projection also increased from 3.22 mmt to 3.43 mmt.

  • As of January 17, Russia’s export duty on wheat has declined from 4,165.9 rubles per mt to 3,946.5 rubles. This represents a 5.3% decrease, and Russian wheat export values remain the world’s cheapest at $240 to $245 per mt. Despite these low prices, Algeria’s recent wheat purchase for up to 650,000 mt of wheat was sourced mainly from Europe.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: The March contract’s closing through the bottom end of the recent range and 100-day moving average lends a bearish tilt to the market, which runs the risk of drifting lower toward the next major level of support near 556. If a bullish catalyst enters the market to turn prices higher, overhead resistance remains near 650.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: The breach of 700 in the March contract could indicate further weakness with the next area of major support down near 669. The market does show signs of being oversold, which is supportive if the market turns back higher. Overhead initial resistance lies around 700 and then again between 721 and 734.

Other Charts / Weather

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01-16 End of Day: Markets Start the Week Mostly Lower on Follow Through Price Action

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • After trading on both sides of unchanged, carryover weakness from lower wheat and expectations of large US and world corn supplies pressed the corn market to close lower on the day.

  • The soybean market saw choppy two sided trade to start the week, and ended the day mixed as old crop gained on new crop. Record NOPA crush numbers helped to lend support, along with sharply higher soybean meal, while sharply lower bean oil added resistance.

  • Weak weekly export inspections and a sharply higher US dollar weighed heavily on the wheat complex today as all three classes closed lower, with both Chicago and KC showing double digit losses to start the week.

  • The US dollar gapped higher on the day’s opening and gained nearly 1% at the time of writing, to trade above the 50-day moving average for the first time since November. While the gap higher appears to be technical in nature, the higher trade, nevertheless, likely added resistance to the grain markets.

  • To see the updated US 6 – 10 day temperature and precipitation outlooks, and 2-week total precipitation forecasts for Brazil and Argentina, courtesy of the NWS, NOAA, and CPC, scroll down to 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

  • No new action is recommended for 2023 corn. After posting a high in October, front month corn futures have steadily drifted sideways to lower with a general lack of bullish news and an estimated carryout around 2.1 billion bushels. If the January USDA report fails to provide a bullish catalyst to the market, it remains at risk of continuing to languish in the same pattern. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Since late February ’22, Dec ’24 has been bound by 485 ¾ on the bottom and 602 on the top. During this time, Dec ’24 has held up better as bear spreading has allowed Dec ’24 to maintain more of its value versus old crop prices as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Moving forward, the risk for 2024 prices is the same as for 2023 prices, which is a continuation of a sideways to lower trend without a bullish catalyst. Grain Market Insider is watching for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying Dec ‘23 560 and 610 call options ahead of the summer rally and having those in place helped provide confidence to pull the trigger on recommending 2023 sales into that sharp rally, knowing that if corn kept rallying and went to 700 or 800 that the call options would protect those sold bushels.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Corn futures finished the session lower, pressured by the prospects of large US and global corn supplies, and selling pressure in the wheat market triggered by a jump in the value of the US dollar.  March corn lost 3 ½ cents on the session, but did hold above Friday’s report day lows.

  • The corn market continues to look for positive news after Friday’s USDA Grain Stocks and WASDE report. US corn carryout was raised by 30 mb to 2.162 bb, but the 12 mmt rise in Chinese corn production helped surge world ending stock above expectations, reflecting a potential record Chinese corn crop. The heavier global supplies keep pressure on a market searching for demand.

  • Demand will stay a focus for the corn market and the need for export sales is important. The USDA announced a flash sale of 126,700 mt (5 mb) of corn to Mexico.

  • USDA reported weekly export inspections at 876,000 mt (34.5 MB) for the week ending January 11.  Total inspection has reached 548 mb, up 29% year over year, the USDA is forecasting a 26% jump.

  • Managed funds are staying aggressively short the market and growing this position. On last week’s Commitment of Traders eport, funds were short 230,723 net contracts of corn. The position is likely to be larger after the strong selling pressure to end the week.

Above: Since the end of December, the March corn contract has slid lower with only minor reversals. After breaking through 460, the market runs the risk of retreating toward the 415 support level without some bullish input. The market currently shows signs of being oversold, which can be supportive if a bullish catalyst arises to turn prices back higher. If one does enter the market, nearby upside resistance could be found around 470 and again near 481, with heavy resistance between 495-500.

Corn Managed Money Funds net position as of Tuesday, Jan 2. Net position in Green versus price in Red. Managers net sold 33,397 contracts between Jan. 3 – 9, bringing their total position to a net short 230,723 contracts.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout and considering the bullish influence of adverse South American weather which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day higher with support from higher soybean meal and a record-breaking NOPA crush report. Last week’s trade was rough with March soybeans losing 32 cents after a bearish WASDE report on Friday, but they ended the week significantly off their report lows.

  • The biggest story in soybeans today was the NOPA crush report that showed 195.33 million bushels of soybeans crushed in December, which was well above the average trade guess and a record for any month. The crush was up 10% year over year and up 5% from the prior December high.

  • While soybean meal saw higher trade following the NOPA report, soybean oil moved lower. Soybean oil stocks were pegged at 1.36 billion pounds, which was above the average trade guess of 1.291 billion pounds, but stocks were still down 24% year over year.

  • The USDA reported weekly export inspections at 1.264 mmt (46.4 mb) for the week ending January 11.  Total inspections have reached 940 mb, down 21% year over year. The USDA is forecasting a 12% drop.

  • The highlights of Friday’s WASDE report were an unexpected increase in US soybean yields for 23/24 and a decline in Brazilian production that was much smaller than expected or is likely realistic. The USDA currently estimates Brazilian soy production at 157 mmt which is down from their last guess of 161 mmt, but most analysts are guessing that number is closer to 150, and some are even in the low 140’s due to the early drought and heat.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Soybean Managed Money Funds net position as of Tuesday, Jan. 9. Net position in Green versus price in Red. Money Managers net sold 19,619 contracts between Jan. 3 – 9, bringing their total position to a net short 31,248 contracts.

Wheat

Market Notes: Wheat

  • All three US wheats finished with losses; both Chicago and KC wheat showed double digit losses. Weakness stemmed from a sharply higher US Dollar Index, which actually gapped higher today. As of this writing, it is up 0.99 at 103.40. This higher dollar should make US exports less competitive, which is not helped by the fact that the USDA increased their estimate of Russian and Ukrainian exports last week.  

  • The USDA reported weekly wheat inspections at 8.6 mb, which brings the 23/24 total inspections to 381 mb. That is below the pace needed to meet the USDA’s goal and is also down 16% from last year. On Friday, the USDA left their estimate of 23/24 wheat exports unchanged at 725 mb.

  • Although they have not made any changes to the export ban on wheat, they did suggest that they have a better than expected wheat crop. Said to be around 114 mmt, this is above the USDA’s projection, and may indicate that they will not need to import wheat this year. If true, this could add to the bearish tone in the market.

  • Over the past three weeks, 1.3 mmt of ag goods on ocean vessels are said to have been rerouted to avoid traveling through the Suez Canal and Red Sea region. Ships want to avoid conflict in that area, but this is also resulting in increased global freight costs. Reportedly, an average of 80 mmt of grain passes through the Red Sea every year with just over a third of that going to China.  

  • According to Ukraine’s agriculture ministry, 2.1 mmt of grain has been exported so far this month, up from 1.7 mmt last year. While no explanation was offered regarding the monthly increase, it should be noted that their total grain exports are down from last year since the season began July 1. The total so far is 20.6 mmt versus 24.5 mmt last year and of that total, 8.2 mmt is wheat.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: The March contract is closing through the bottom end of the recent range and 100-day moving average lends a bearish tilt to the market, which runs the risk of drifting lower toward the next major level of support near 556. If a bullish catalyst enters the market to turn prices higher, overhead resistance remains near 650.

Chicago Wheat Managed Money Funds net position as of Tuesday, Jan. 9. Net position in Green versus price in Red. Money Managers net bought 2,289 contracts between Jan 3 – 9, bringing their total position to a net short 57,988 contracts.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

KC Wheat Managed Money Funds net position as of Tuesday, Jan. 9. Net position in Green versus price in Red. Money Managers net sold 230 contracts between Jan. 3 – 9, bringing their total position to a net short 34,266 contracts.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: The breach of 700 in the March contract could indicate further weakness with the next area of major support down near 669. The market does show signs of being oversold, which is supportive if the market turns back higher. Overhead initial resistance lies around 700 and then again between 721 and 734.

Minneapolis Wheat Managed Money Funds net position as of Tuesday, Jan. 9. Net position in Green versus price in Red. Money Managers net sold 1,905 contracts between Jan. 3 – 9, bringing their total position to a net short 28,637 contracts.

Other Charts / Weather

Brazil 2 week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

Argentina 2 week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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01-12 End of Day: Bearish USDA Numbers Press Markets Lower to End the Week.

ByGrain Market Insider

The CME and Total Farm Marketing offices will be closed Monday, January 15, 2024, in observance of Martin Luther King Jr. Day

 

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Net increases in 23/24 US corn ending stocks and South American production pressed March corn 16 ¾ cents lower to fresh contract lows before rebounding 6 cents into the close.

  • USDA soybean projections that came in above expectations across the board for both US production and ending stocks, as well as both Brazil and Argentina production, slammed March soybeans to a low of 1203 before they recovered to close 11 ¼ cents off the low.

  • Both soybean meal and oil saw wide ranges on both sides of unchanged before closing lower on the day. Meal posted a new low for the move before rebounding to close just $0.10 lower, while soybean oil posted a bearish reversal and closed with a 0.47 cent loss.  

  • A generally bearish USDA report weighed on the wheat complex despite lower US ending stocks and planted acreage estimates. Chicago contracts led the way down with all three classes settling lower on the day but well off their respective lows.

  • To see the updated US 6 – 10 day temperature and precipitation outlooks, and 2-week precipitation forecasts as a percent of normal for Brazil and Argentina, courtesy of the NWS, NOAA, and CPC, scroll down to 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

  • No new action is recommended for 2023 corn. After posting a high in October, front month corn futures have steadily drifted sideways to lower with a general lack of bullish news and an estimated carryout around 2.1 billion bushels. If the January USDA report fails to provide a bullish catalyst to the market, it remains at risk of continuing to languish in the same pattern. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Since late February ’22, Dec ’24 has been bound by 485 ¾ on the bottom and 602 on the top. During this time, Dec ’24 has held up better as bear spreading has allowed Dec ’24 to maintain more of its value versus old crop prices as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Moving forward, the risk for 2024 prices is the same as for 2023 prices, which is a continuation of a sideways to lower trend without a bullish catalyst. Grain Market Insider is watching for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying Dec ‘23 560 and 610 call options ahead of the summer rally and having those in place helped provide confidence to pull the trigger on recommending 2023 sales into that sharp rally, knowing that if corn kept rallying and went to 700 or 800 that the call options would protect those sold bushels.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Grain markets saw strong selling pressure as a bearish USDA WASDE report reflected strong global and US corn supplies. The report brought increased yield adjustments for US production this past growing season. March corn futures traded to new contract lows, down 10 ¾ cents on the session. For the week, March corn futures lost 13 ¾ cents.

  • The USDA raised US corn yield this past season to 177.3 bushels/acre, up 2.4 bushel from the December projection. This, taking away a small reduction in harvested acres raised corn production 107 mb over the December report. After demand adjustments, US corn ending stocks were raised 31 mb, and above market expectations. This projected carryout is 802 mb higher than last year.

  • The USDA made changes in their forecast for South American production for this growing season. The USDA lowered projected Brazil corn production to 127 mmt, down 2 mmt from December, and left Argentina corn production unchanged. Both moves reflect the current weather situation in each country. Yesterday, the Rosario Grain Exchange raised the Argentina crop to a projected 59 mmt, which would be a record for the South American country.

  • US Quarterly Grain Stocks as of December 1 for corn were 12.169 billion bushels, over 100 mb above analyst expectations, and 1.35 billion bushels larger than last year. The jump in stocks is reflective of the strong corn production in the US this past season.

  • With the strong US and Argentina production, world corn ending stocks for corn are estimated at 325.22 mmt, up 10 mmt from last month and 12 mmt above the trade guesses for the report.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout and considering the bullish influence of adverse South American weather which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • The USDA released its monthly WASDE update and quarterly grain stocks as of December 1. 23/24 production and ending stocks both came in above expectations, as did December 1 grain stocks to initially push soybeans 33 cents lower but close with just a 12 ¼ cent loss. 

  • US 23/24 ending stocks are now estimated at 280 mb, up 35 million from last month, with higher Dec. 1 stocks of 3.0 bb and production of 4.126 bb both contributing to the higher ending stocks.

  • The USDA’s South American production estimates also came in above expectations. Brazil’s soybean production is now estimated at 157 mmt, versus the average trade guess of 156.26, and the USDA estimated Argentina’s production 2 mmt above the average guess of 48 mmt.

  • With increases in both US and South American production, the USDA raised its projection for world ending stocks slightly from 114.21 mmt in December, to 114.6 mmt, where average trade expectations were for a net reduction to 111.58 mmt.

  • Next Tuesday NOPA will release its monthly crush report relaying total crush amounts for the month of December. Average estimates are calling for a record 193.12 mb of soybeans crushed last month, if realized. The total would represent a 2.2% increase from November’s 189.038 mb crushed and an 8.8% increase from last year. Dec. 31 soybean oil stocks are estimated to increase 6.4% to 1.291 billion lbs.

  • Rainfall totals in Mato Grosso, Brazil are expected to decline over the next couple of weeks. Although with the rain they have received recently, this shouldn’t cause much issue. However, some of the other drier areas of Brazil may get good rain coverage over the next couple of weeks.

Wheat

Market Notes: Wheat

  • Wheat closed lower in all three classes alongside Paris milling wheat, and as the US Dollar continues to consolidate. Of course, today’s price action had much more to do with all the data released by the USDA. Initially, wheat was a little higher just after the report came out, possibly because winter wheat acreage was estimated at 34.4 million acres versus an expected 35.9 ma. But the negative tone of the report in general weighed on wheat by the end of the session.

  • The USDA pegged US wheat quarterly stocks for December 1 at 1.410 bb. The trade was looking for 1.383 bb, which compares to 1.780 bb in September and 1.312 bb in December 2022.

  • US ending stocks for wheat came in at 647 mb, whereas the trade was looking for 658 mb. This is also a decline from the December report which was 659 mb. For the world number, the USDA estimated 260.0 mmt of wheat carryout, up from the average trade estimate of 258.3 mmt, and up from December at 258.2 mmt.

  • For Russia and Ukraine, wheat exports were both raised slightly to 51.0 mmt and 14.0 mmt respectively. US wheat exports were left unchanged by the USDA at 725 mb. As far as other world numbers, production in Australia at 25.5 mmt and in Argentina at 15.0 mmt were both unchanged from last month by the USDA.

  • According to the Buenos Aires Grain Exchange, their 23/24 wheat crop is 95% harvested, and their production estimate was unchanged from 15.1 mmt. For reference, this is up from 12.2 mmt last year.

  • The NOAA Climate Prediction Center estimates a 73% chance that El Nino will become neutral this spring. In other words, the pattern should come to an end. This may provide good conditions for planting in the US this spring. They also suggested that after a neutral period, the pattern will have a 64% chance to switch back to La Nina by August.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Other Charts / Weather

Brazil 2-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.

Argentina 2-week forecast precipitation, percent of normal, courtesy of the National Weather Service, Climate Prediction Center.

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01-11 End of Day: Grains Settle Mixed as They Consolidate Ahead of Friday’s USDA Report.

ByGrain Market Insider

The CME and Total Farm Marketing offices will be closed Monday, January 15, 2024, in observance of Martin Luther King Jr. Day

 

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Choppy trade dominated the corn which finished the day slightly lower. Export sales that came in on the low end of expectations lent resistance to prices despite a 175,000 mt sale to Mexico.

  • Soybeans ended the day firmer following choppy two-sided trade, as the market garnered some support from short covering activity ahead of tomorrow’s USDA update.

  • Soybean oil also lent strength to soybeans today as it continued to follow through on Monday’s bullish reversal and rallies in the energy sector. Soybean meal, on the other hand, declined again with pressure coming from slowing US demand amid the anticipated recovery of Argentine production.

  • A bearish reversal in Paris milling wheat and US export sales that came in below expectations weighed on the wheat complex that saw a mild selloff in all three classes. Though weekly sales were below expectations, year-over-year sales remain 2% higher than last year.

  • Consumer price data was released today and was 0.2% higher than expected on an annualized basis. This triggered some buying in the US dollar which showed only modest gains at the time of writing on thoughts the Federal Reserve may be less dovish with interest rates in 2024. Overall, lower prices for the US dollar are anticipated, which could lend support to commodities.

  • To see the updated US Drought Monitor, and 2-week precipitation forecasts for Brazil and Argentina, courtesy of the NDMC, NWS, and CPC, scroll down to 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

  • No new action is recommended for 2023 corn. After posting a high in October, front month corn futures have steadily drifted sideways to lower with a general lack of bullish news and an estimated carryout around 2.1 billion bushels. If the January USDA report fails to provide a bullish catalyst to the market, it remains at risk of continuing to languish in the same pattern. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Since late February ’22, Dec ’24 has been bound by 485 ¾ on the bottom and 602 on the top. During this time, Dec ’24 has held up better as bear spreading has allowed Dec ’24 to maintain more of its value versus old crop prices as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Moving forward, the risk for 2024 prices is the same as for 2023 prices, which is a continuation of a sideways to lower trend without a bullish catalyst. Grain Market Insider is watching for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying Dec ‘23 560 and 610 call options ahead of the summer rally and having those in place helped provide confidence to pull the trigger on recommending 2023 sales into that sharp rally, knowing that if corn kept rallying and went to 700 or 800 that the call options would protect those sold bushels.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • Corn prices stay choppy going into Friday’s USDA report. March corn slipped 1 ¾ cents on the session and had a narrow 5 ¾ cent trading range as prices hover around the 460 level.

  • This morning the USDA released weekly export sales for last week. US exporters reported new sales of 487,600 mt (19.2 mb) for the current marketing year. This total was at the low end of expectations by analysts and disappointing in a difficult demand market. Total corn sales commitments now total 1.192 billion bushels and are up 38% from a year ago.

  • The USDA announced a flash sale of 175,000 mt (6.9 mb) of corn to Mexico for the current marketing year. This was the first announcement of an export sale of grain since December 19. The corn market is looking for additional export business, as the window for US corn exports should be more open before the South American harvest begins.

  • The Rosario Grain Exchange raised its forecast for the 23/24 Argentina corn crop by 3 mmt. The exchange expects Argentina to produce 59 mmt of corn this season, which would be record production for the South American country.

  • On Friday, the USDA will release the January WASDE, Crop Production and Grain Stocks reports. Expectations are for corn carryout projections to be reduced slightly as the USDA adjusts harvested acres and yield. Demand and first quarter usage will be closely watched, as improved feed demand at the end of the year could tighten overall supplies. Beside US totals, the markets will keep a close eye on any adjustments to Brazil and Argentina crop production.

Above: Since the end of December, the March corn contract has slid lower with only minor reversals. After breaking through 460, the market runs the risk of retreating toward the 415 support level without some bullish input. The market currently shows signs of being oversold, which can be supportive if a bullish catalyst arises to turn prices back higher. If one does enter the market, nearby upside resistance could be found around 470 and again near 481, with heavy resistance between 495-500.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout and considering the bullish influence of adverse South American weather which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans began the trading session significantly higher overnight with the March contract as much as 10 cents higher, but both soybean and meal prices faded into the close with soybeans unchanged and meal lower. Soybean oil had support from higher palm and crude oil.

  • Overnight, weather models were adjusted to show dryness in central and northern Brazil over the next 7-days, but the recent rains have been steady and have likely helped the crop out quite a bit. Brazil has some areas of very low yielding soybeans, but this may be partially priced in at this point.

  • Tomorrow, the USDA will release the WASDE report, and traders will be watching the South American numbers closely. Brazil’s estimated soybean production will likely be reduced, but there is a chance that Argentina’s will be increased. US ending stocks for both corn and soybeans are expected to decline slightly when looking at the average trade guesses.

  • Today’s export sales report was disappointing for soybeans with 10.3 mb sold for 23/24 which brings this year’s total sales 17% below last year at this time. Last week’s export shipments of 31.7 mb were above the 24.9 mb needed each week to meet the USDA’s estimates. Primary estimates were to China, Mexico, and Japan.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • All three US wheat classes posted modest losses of about seven to eight cents for each class across the board. Some weakness may have stemmed from expectations for a relatively neutral report tomorrow in terms of the supply and demand numbers. Also, Paris milling wheat futures posted a reversal from yesterday, in which they took out yesterday’s high but also closed below yesterday’s low. This looks technically weak and offers no support for the US market.

  • The USDA reported an increase of only 4.7 mb of wheat export sales for 23/24 and was below the lower end of expectations. However, shipments last week totaled 21.5 mb, which is above the pace of 16.8 mb needed per week to meet the USDA’s 725 mb export goal.

  • The average trade guess for winter wheat acreage in tomorrow’s USDA update comes in at 35.9 million acres versus 36.7 in 2023. Some private guesses call for a reduction of up to 2 ma, though the range of estimates is relatively wide with 34.5 ma on the low end to 39.4 ma on the high end.

  • The average pre-report estimate of US wheat quarterly stocks as of December 1 is pegged at 1.383 bb, versus 1.780 bb in September, and compares with 1.312 bb in December of 2022. In addition, US wheat ending stocks are expected to come in near unchanged at 658 mb, versus 659 mb in December.

  • Turkey, Romania, and Bulgaria have reportedly joined forces to sweep the Black Sea for mines and defuse them. Additionally, other NATO members including the US and UK are being excluded from the operation; this is said to be in an effort to minimize tensions in that region. De-mining these areas will improve shipping safety for Ukrainian vessels carrying grain and other goods. In December, Ukraine shipped 4.8 mmt of grain via their own corridor; this is more than any single month during the export deal with Russia.

  • Russia continues to offer the world’s cheapest wheat, with export values falling between $245 to $247 per mt FOB. Russia recently supplied most of the wheat for Egypt’s tender in which they purchased 6-7 cargoes of wheat.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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 early December, the July ’24 contract has traded mostly sideways to slightly lower after its brief short covering runup on Chinese buying. Although China has since been absent from the US wheat export market, managed funds continue to hold a sizeable, short position that could trigger another short covering rally if a bullish impetus enters the market. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: March Chicago wheat continues to challenge support around the 50 and 100-day moving averages. If more bullish influence enters the market, prices could push higher to test overhead resistance near 650. If not, and prices begin to retreat, the next level of major support comes in near 556.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: After making a new contract low on November 27, the March contract found buying interest from its oversold status and record fund short. Since then, the market posted a bearish reversal on December 6, showing significant resistance in the 750 area. If prices can break through upside resistance, they could run toward 790. If prices retreat, nearby support could be found around 718, with further support near the recent low of 697 ½.

Other Charts / Weather

Brazil 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

Argentina 2-week forecast total precipitation courtesy of the National Weather Service, Climate Prediction Center.

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01-10 End of Day: Beans Slide Lower While Corn and Wheat Consolidate.

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Corn futures saw two-sided trade on both sides of unchanged to close fractionally mixed on the day as selling pressure from neighboring soybeans offset news of CONAB’s downgrade of Brazil’s corn crop.

  • Soybeans gave up yesterday’s gains and then some with weakness coming from CONAB’s estimate of Brazil’s soybean production that came in higher than expected, as well as reports of an early Brazilian soybean harvest that may be closing the US export window early.

  • Soybean meal and oil also showed losses for the day. Slowing meal demand and increasing supplies continue to add resistance to meal and soybean prices, although crush margins remain profitable, incentivizing crushers.

  • The wheat complex ended the day mixed with both Chicago and Minneapolis slightly higher on the day and KC slightly lower as the markets continue to consolidate ahead of Friday’s USDA WASDE and winter wheat plantings report.

  • To see the updated GRACE-Based root zone drought indicator maps for the US and South America, courtesy of NASA and the NDMC, scroll down to 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

  • No new action is recommended for 2023 corn. After posting a high in October, front month corn futures have steadily drifted sideways to lower with a general lack of bullish news and an estimated carryout around 2.1 billion bushels. If the January USDA report fails to provide a bullish catalyst to the market, it remains at risk of continuing to languish in the same pattern. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. For now, Grain Market Insider will continue to hold tight on any further sales recommendations for the next few weeks with the objective of seeking out better pricing opportunities. If the market has not turned around by then, Grain Market Insider may sit tight on the next sales recommendations until spring.

  • No new action is recommended for 2024 corn. Since late February ’22, Dec ’24 has been bound by 485 ¾ on the bottom and 602 on the top. During this time, Dec ’24 has held up better as bear spreading has allowed Dec ’24 to maintain more of its value versus old crop prices as traders attempt to price in a larger 2023 carryout with more uncertainty remaining for the 2024 crop. Moving forward, the risk for 2024 prices is the same as for 2023 prices, which is a continuation of a sideways to lower trend without a bullish catalyst. Grain Market Insider is watching for signs of a change in the current trend to look at recommending making additional sales and buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying Dec ‘23 560 and 610 call options ahead of the summer rally and having those in place helped provide confidence to pull the trigger on recommending 2023 sales into that sharp rally, knowing that if corn kept rallying and went to 700 or 800 that the call options would protect those sold bushels.

  • No Action is currently recommended for 2025 corn. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be late winter or early spring of 2024 before Grain Market Insider starts considering the first sales targets.

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

  • It was a quiet news day in the corn market as prices traded off early session lows to finish mixed on the day. March corn gained ¾ of a cent in a day that saw a 6 ¾ cent trading range. Steady selling pressure in the soybean market limited the corn market’s upside potential on the day.

  • The Brazil Ag agency, CONAB, released their January corn production estimates this morning. CONAB lowered its projection for the 2023/24 corn crop to 117.6 mmt, down 0.93 mmt from their December projections and down 14.35 mmt from last year. CONAB did leave their second crop corn projection unchanged at this point. Poor early season weather and reduced planting area was the reason for the decrease.

  • USDA will release weekly export sales totals on Thursday morning. Expectations are for corn sales to range from 400,000 to 1.0 mmt. Corn should be entering a more active export window, but the market hasn’t had a published export sale since December 19.

  • The key news event this week will be Friday’s USDA WASDE and Grain Stocks reports. Expectations are for corn carryout projections to be reduced slightly as the USDA adjusts harvested acres and yield. Demand and first quarter usage will be closely watched, as improved feed demand at the end of the year could tighten overall supplies.

  • Managed and speculative funds are maintaining the pressure on the short side on the market. With this week’s overall selling pressure, funds are expected to be short over 200,000 net contracts of corn, likely the largest short position since 2020, as the prospects of growing supplies and demand concerns are in control of the market.

Above: Since the end of December, the March corn contract has slid lower with only minor reversals. After breaking through 460, the market runs the risk of retreating toward the 415 support level without some bullish input. The market currently shows signs of being oversold, which can be supportive if a bullish catalyst arises to turn prices back higher. If one does enter the market, nearby upside resistance could be found around 470 and again near 481, with heavy resistance between 495-500.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans recent downside breakout of the 1290 – 1400 range indicates that there is risk that prices may continue to retreat toward 1180, as forecasts for improved South American weather lessen the potential for the record large global carryout to be reduced. Given the potential of a downside breakout, Grain Market Insider recently recommended adding to sales as the current price level is still historically good. It’s been disappointing how the market has been unable to push higher despite the South American production concerns. Because of that, Grain Market Insider’s concern is that, if the weather pattern doesn’t remain adverse, the path of least resistance could be lower. Grain Market Insider will continue to look at additional sales opportunities, as well as potential re-ownership strategies.

  • No new action is recommended for the 2024 crop. The Nov ’24 contract recently broke through the downside of the 1233 – 1320 range that has been in place since the end of July. With this downside breakout and considering the bullish influence of adverse South American weather which appears to be improving, Nov ’24 runs the risk of retreating towards 1150 unless another bullish catalyst enters the market.  If prices find support and turn back higher, Grain Market Insider recently recommended buying Nov ’24 1280 and 1360 calls to give you confidence to make sales against anticipated 2024 production and to protect any sales in an extended rally. Grain Market Insider will also continue to watch for any sales opportunities.

  • No Action is currently recommended for 2025 Soybeans. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.

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

  • Soybeans ended the day lower but have maintained a trading range over the past three days with the March contract finding support at 1235. Both soybean meal and oil were lower with soybean oil pressured by lower palm oil and crude oil.

  • CONAB numbers were released and were higher than expected for soybeans which pressured the market today. CONAB projected that Brazil will produce 155.27 mmt of soybeans for 23/24, but many private analysts have their projections closer to 150 mmt. The USDA’s guess in December was 161 mmt which certainly seems too high, but on Friday it will become a question of how much they reduce that number by.

  • Soybean exports have begun to slow down as the export window in the US is closing with some parts of Brazil harvesting their soybeans that were damaged from heat and dryness. Monday’s export inspections report was disappointing, and there has not been a flash sale announced for soybeans since December 19.

  • South American weather is forecast to be wet throughout this week before turning drier. Argentina’s crop has benefitted from good weather throughout the growing season, but some areas of Brazil delt with the heat and drought for too long, and the recent rainfall has not been as beneficial as had hoped.

Above: Soybeans have steadily retreated after leaving a 6-cent gap between 1290 ¾ and 1296 ¾. The market is showing signs of being extremely oversold, which can be supportive if bullish information enters the market to turn prices around. If prices do turn back higher, resistance rests around the price gap and again near the 50-day moving average. Otherwise, the next major support level comes in near the November ’21 low of 1181.

Wheat

Market Notes: Wheat

  • Wheat had a mixed close and was close to neutral. Chicago and Minneapolis posted small gains while KC was down slightly. The market may be entering a “wait and see” mode ahead of Friday’s USDA reports. In addition to supply and demand, traders will also receive the winter wheat acreage estimate and private guesses are calling for a reduction of at least one million acres.

  • The US Dollar Index has been consolidating for the past several sessions. If it breaks out to the upside, it will pressure the wheat market, but if it trends lower again, that would offer support. With Russia still taking the lead on exports, it would be beneficial to see the Dollar trend lower.

  • Another issue faced by not only wheat, but the commodity complex as a whole, is the continuation of drone attacks on merchant vessels in the Red Sea. This is affecting trade routes and raising freight costs, and reportedly the number of attacks yesterday was the largest to date.

  • From the beginning of their season on July 1, as of January 7, EU soft wheat exports totaled 15.8 mmt. This represents an 11% drop from the 17.8 mmt last year. The top destinations were countries in North Africa, including Morocco, Algeria, and Nigeria.

  • Another major winter storm is set to hit the Midwest later this week. While the moisture may be beneficial, the extreme cold temperatures may not. Areas with little to no snow cover may face the risk of crop damage, but at this time the consensus is that it won’t be a major issue. In addition to the US, colder temperatures will also make their way into Europe and the Black Sea.

  • Egypt purchased 420,000 mt of wheat in their tender. The majority of which, was sourced from Russia, but one cargo was said to come from Ukraine. Other tenders include Algeria and Japan; Japan is looking to purchase from the US and Canada.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market has continued to be dominated by lower world export prices that have stymied US export sales and depressed US prices. In early December, Grain Market Insider recommended taking advantage and making a sale on a short covering rally which was sparked by several Chinese purchases of US wheat. Since then, China has been silent in the US wheat export market, and prices remain somewhat elevated. Any remaining 2023 soft red winter wheat should be getting priced into market strength with the goal of having zero bushels unpriced by the end of January. 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. From the end of July, the July ’24 contract has slowly stepped its way down to a low of 586 in sympathy with the front month contract where managed money established a large short position during that time. Since then, July ’24 rallied alongside the March ’24 contract, as the funds covered over 30k contracts of their nearly 130k short contract position. While bearish headwinds remain, the funds continue to carry a large short position and seasonals remain supportive for the addition of weather risk premium, which are two factors that could fuel further short covering and another leg up in prices. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for further price erosion. Back in June, Grain Market Insider recommended two separate sales that averaged about 720 to take advantage of the brief upswing. If the market receives the needed stimulus to move prices back toward this summer’s highs, Grain Market Insider is prepared to recommend adding to current sales levels and possibly even purchasing call options to protect those sales. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Grain Market Insider will be prepared to recommend covering some of those puts to offset much of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Since early September, the July ’25 contract has been rangebound, largely between 650 on the bottom and 675 on the top. Grain Market Insider’s strategy for the 2025 crop year up to this point has been to sit tight. Though if prices break out of the topside of this range toward the 690 – 705 area, we will consider taking advantage of the rally and making sales recommendations.

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

Above: March Chicago wheat continues to challenge support around the 50 and 100-day moving averages. If more bullish influence enters the market, prices could push higher to test overhead resistance near 650. If not, and prices begin to retreat, the next level of major support comes in near 556.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 KC wheat crop.  After posting an 80-cent rally in late November and early December, front month KC wheat has languished and drifted lower while retracing about 50% of the upward move. Managed funds continue to carry a significant short position, and even though bullish headwinds like weak US demand and low world wheat prices remain, this could fuel a return to higher prices as winter weather risks add volatility to the market. Grain Market Insider’s strategy is to look for price appreciation this winter, as weather becomes a more prominent market mover, and may consider suggesting additional sales if prices become over-extended.

  • No new action is recommended for 2024 KC wheat. At the end of August, the July ’24 contract broke out of roughly a one-year trading range and stepped down to a 609 ¼ low in late November, largely driven by managed fund selling in the front month on weak US export demand and lower world wheat prices. Since then, the funds covered part of their large short position which also rallied prices in the July ’24 contract. While bearish headwinds remain, managed funds continue to hold a sizable, short position, and price seasonals remain positive for adding weather risk premium. These are two factors that could fuel additional short covering and rally prices in the months ahead. Back in August, Grain Market Insider recommended buying Jul’24 KC wheat 660 puts to protect the downside following the range breakout. As the market recently got further extended into oversold territory and the July contract showed signs of support near 630, Grain Market Insider recommended exiting 75% of the originally recommended position. Moving forward, Grain Market Insider is prepared to recommend exiting the last 25% on any further supportive market developments.

  • No action is currently recommended for 2025 KC Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted next fall. It will probably be mid-winter before Insider starts considering the first sales targets.

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

Above: March KC wheat rejected an attempt to move higher near 650 and turned lower to test the bottom end of the recent range around 619. If the market continues to retreat, the next area of support remains near 595 and 575. Overhead, nearby resistance comes in around 650 and again between 675 – 680.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. For much of the second half of last year, driven mostly by fund selling and slow US export demand, front month Minneapolis wheat slowly stair-stepped lower until hitting the November low. During this time, managed funds also established a record net short position. Since then, with the market mostly sideways, the November low of 697 ½ has held, and prices have pierced the 50-day moving average just once. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if a bullish catalyst enters the scene to move prices to close above the 50-day moving average. Back in June, Grain Market Insider made a sales recommendation during the July rally near 820, and with that sale in place, Grain Market Insider’s strategy is to look for price appreciation this winter with an eye on considering additional sales around 725 – 775, and again north of 800.

  • No new action is recommended for 2024 Minneapolis wheat. After trading to a peak of 871 ¾ last August, the Sept ’24 gradually retreated to a low in November in concert with the front month as managed funds built a record large net short position mostly on weak US export demand. And while Sept ’24 has failed to close above the 50-day moving average since late August, the 726 ¼ November low remains intact. Although bearish headwinds remain, the large fund net short position could fuel a short-covering rally if prices move higher and close above the 50-day moving average. Back in August, Grain Market Insider recommended buying July ’24 KC wheat 660 puts to protect the downside following a 1-year range breakout in KC wheat, and in November recommended exiting 75% of the originally recommended position as July ’24 KC wheat showed signs of support around 630. While in the same time frame, Grain Market Insider also recommended making an additional sale as the Sept ’24 Minneapolis contract broke long time 743 support. For now, Grain Market Insider remains prepared to recommend exiting the last 25% of the open puts on any further supportive market developments.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted two springs from now. It will probably be mid-winter before Grain Market Insider starts considering the first sales targets.

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

Above: After making a new contract low on November 27, the March contract found buying interest from its oversold status and record fund short. Since then, the market posted a bearish reversal on December 6, showing significant resistance in the 750 area. If prices can break through upside resistance, they could run toward 790. If prices retreat, nearby support could be found around 718, with further support near the recent low of 697 ½.

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