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Grain Market Insider: October 19, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Decent export sales, strong domestic demand, and light farmer selling lent support to December corn as it pushed above the 500 mark for the first time in nearly 3 months, which likely spurred short covering into the close.   

  • Like corn, good export sales, solid domestic demand and light farmer selling pushed November beans to gain on the deferred months, and close higher on the day for the fourth day in a row.

  • Soybean meal continued its rally to levels not seen since last July. Technical buying, strong export sales, and dryness in Argentina, the world’s largest soy product exporter, all lent support to the market.  Bean oil, on the other hand, saw sharply lower price action on more long liquidation, with lower palm oil adding to the weakness.

  • Carryover strength from the corn market and higher than expected export sales lent support to all three wheat classes, and likely triggered short covering in the Chicago contracts, which had an estimated fund short position just over 100k contracts going into today.

  • To see the current U.S. 5-day precipitation forecast, the 6 – 10 day Temperature and Precipitation Outlooks, and the 1 week percent of normal precipitation for South America from the NWS and NOAA, 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. The supportive USDA Supply and Demand report from October 12 had Dec ’23 corn testing that 500 psychological price level, yet so far Dec ’23 has been unable to close above it. That 500 level remains an important resistance area for the trend, and without a close over it, the market remains at risk of continuing to trend sideways to lower, and worst-case scenarios could entail sideways-to-lower trends into the late November to early January window. If Dec ’23 can close above 500, it may aim to test the next resistance near 547. Otherwise, the first support on the downside is the August low of 461. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. So, for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now, Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 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 pushed through technical resistance at the $5.00 level, which triggered additional short covering as the December futures gained 13 cents and closed at its highest price point since July 31.

  • An improved demand tone and cash market basis helped support the front month contract as bull spreading pulled the entire market higher.

  • The USDA released weekly export sales Thursday morning.  Sales for the 2023-24 marketing year were 881,300 mt (34.7 mb). Corn sales commitments now total 637 mb for 23/24 and are up 17% from a year ago, but still lag the overall demand pace needed to reach USDA export targets.  

  • Ethanol margins remain strong, and processors are looking for corn, supporting the cash market.  Strong gasoline demand and tight energy supplies have helped support the ethanol market.

  • Some weather concerns in South America are adding weather premium into prices. Key northern and central areas of Brazil are experiencing hot and dry weather, which is slowing the soybean planting pace. A slow soybean planting pace narrows the window for the second crop of Brazil corn, which could tighten longer-term global supplies.

Above: The corn market has largely been rangebound since the beginning of August, with only minor short covering moving the market higher until recently.  With the market moving above 490, and now 500, the next resistance level in the range is near the 20-day moving average and the July 31 high of 516 ¼. If the market retreats, initial support below the market remains between 475 – 480 and then near 460.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans have been finding buying interest around the June 2023 low of 1256 ¾, and since the beginning of October, they have also traded largely between 1260 and 1280. The close over 1287 ¼ on October 12 could be a signal that a harvest/fall low is in. In the big picture since May 2023, Nov ’23 has traded in a range from 1256 ¾ on the downside to 1435 on the topside. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately to around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • 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 and were bull spread, with the majority of gains landing in the front month, which was supported by higher front month soybean meal. Soybean oil closed lower despite higher crude oil and the lowest soybean oil stocks since 2014.

  • Today’s export sales report was friendly and showed increases of 50.4 mb for 23/24, which was up 30% from the previous week and 92% from the prior 4-week average. Last week’s export shipments of 73.1 mb were well above the 34.6 mb needed each week to meet the USDA’s estimates. Primary destinations were to China, Mexico, and Spain.

  • Weather in South America remains a concern as Argentina and northern Brazil deal with very hot and dry conditions over the next 10 days during planting, and only light rain chances next week. Brazil’s main growing area, Mato Grosso, hit temperatures of 105 degrees yesterday. Due to the heat and drought, only 19% of the crop has been planted, rather than the average of 22%.

  • In the US, this week has been mostly dry giving producers an opportunity to get a good chunk of harvest complete before more rains fall again in the coming week. Despite some reports of “better than expected” yields, a prominent crop scout has called the final bean yield at just 49.3 bpa, below the USDA’s last estimate of 49.6 bpa.

Above: Front month soybeans have pierced the upper end of the 1285 – 1323 resistance area and are testing close in resistance at the 50-day moving average. If the market can maintain upward momentum, it would be poised to make a run to test mid-September prices around 1370. Otherwise, to the downside initial support may be found near 1300 and again near 1273. Key support for the move remains down near 1250.

Wheat

Market Notes: Wheat

  • After trading both sides of unchanged throughout the session, US wheat futures had a strong close, with double digit gains in the Chicago front months. This is in the face of a lower close for Paris milling wheat futures, but may have been helped by today’s dip in the US Dollar Index below the 106 level.

  • The USDA reported an increase of 23.3 mb of wheat export sales for 23/24 and an increase of 1.1 mb for 24/25. Additionally, shipments last week at 14.1 mb were above the 13.9 mb pace per week necessary to hit the USDA’s 700 mb export estimate.

  • The rally in the grain markets was a pleasant surprise, given today’s lack of fresh news. However, it may be reflective of new volatility being added back into the market and uncertainty with several global factors. First and foremost, the potential for the war in Israel to develop into a more significant conflict is on the minds of many traders. Tonight, President Biden will give an address in which he is expected to make the case for providing monetary aid for military assistance in both Israel and Ukraine.

  • The International Grains Council increased the world wheat supply by 2 mmt to 785 mmt, though still below 803 mmt last year. This is apparently a result of higher output in the US, Russia, and Ukraine; Australia was lower.

  • There are continued rumors that China has interest in purchasing more US SRW wheat, though none have been reported over the 100,000 mt minimum required for the USDA to report. Apparently, China may also be looking for US corn. Both things are interesting, considering that according to China’s National Bureau of Statistics, they are looking at record grain production this year. It is possible that their economy is on the mend, which could mean more commodity imports are needed.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 Production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Grain Market Insider made sales recommendations in the late June rally around 720, and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading, due to fund positioning and weak fundamentals, has driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and 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 June’s highs, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year 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 Chicago wheat recommendations:

Above: After its push lower on Sept. 29, December wheat has slowly regained its value and is trading in the same 570 – 618 range it did prior to its break lower. For the market to push through the top side of the range, more bullish input will be needed. If so, the market would be poised to test the 645 – 664 area. If not and the market retreats, initial support could be found near 568 and then down between 547 and 540.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21. With weak U.S. export demand, driven by cheap Russian exports, being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750 it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Grain Market Insider made a sales recommendation in the late May rally around 1170. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800.  If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat. Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

To date, Grain Market Insider has issued the following K.C. recommendations:

Above: Since the end of September, K.C. wheat has been consolidating with initial support just below the market near the September 12 low of 655. If the market retreats lower and breaks through 655, the next levels of support come in around 630 and 575. Initial resistance to the upside may be found around 700 and again near 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat.  In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a nearly 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23.  The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July K.C. 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • 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: For much of September, December Minneapolis wheat was rangebound, and the breakout to the downside on September 29 set the market up to test support near 665, the May ’21 low. Since then, the market has been consolidating upward, with initial support between 711 and 708. If prices continue higher, initial resistance remains between 745 – 760.

Other Charts / Weather

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Grain Market Insider: October 18, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Double digit gains in soybeans and a 5-year high in weekly ethanol production more than offset any harvest pressure that came into the corn market, as December corn held onto modest gains following choppy trade.

  • Follow through buying from yesterday’s rally faded and then surged into the close as sharply higher soybean meal and another flash sale to China supported the soybean market to end the day with double-digit gains.

  • Soybean meal continues to be supported by demand, driven by the dry Argentine weather and additional technical buying above the 400 support level. Soybean oil, on the other hand, closed lower on the day after failing to trade through the 20-day moving average for the third day in a row.

  • Rising tensions in the Middle East and production concerns in the southern hemisphere led the wheat complex to close higher on the day in all three wheat classes.

  • To see the current U.S. 7-day precipitation forecast, the 8 – 14 day Temperature and Precipitation Outlooks, and the 2 week precipitation forecast for South America from the NWS and NOAA, 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. The supportive USDA Supply and Demand report from October 12 had Dec ’23 corn testing that 500 psychological price level, yet so far Dec ’23 has been unable to close above it. That 500 level remains an important resistance area for the trend, and without a close over it, the market remains at risk of continuing to trend sideways to lower, and worst-case scenarios could entail sideways-to-lower trends into the late November to early January window. If Dec ’23 can close above 500, it may aim to test the next resistance near 547. Otherwise, the first support on the downside is the August low of 461. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. So, for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now, Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 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:

  • A buying tone in the grain markets helped lift the corn market higher on the day. Even as harvest pressure limited gains, December corn futures gained 3 cents on the session.

  • The soybean market and soybean meal led the grain markets higher, as some weather concerns are adding weather premium into prices. Key northern and central areas of Brazil are experiencing hot and dry weather, which is slowing the soybean planting pace. A slow soybean planting pace narrows the window for the second crop of Brazil corn, which could tighten longer-term global supplies.

  • Weekly ethanol production rose to a 5-year high last week at 1.035 million barrels/day; this was slightly higher than the previous week’s total. Ethanol stocks slipped to a 9-year low at 21.1 million barrels for the week ending October 13. Ethanol producers used 100.1 mb of corn last week as the yearly pace is 3.9% ahead of last year’s levels.

  • US weather is supporting harvest pace in some regions, but longer-term forecasts may add concern for the corn market in the northern Corn Belt. A potential series of storms going into the end of October could limit the harvest pace and possibly damage the mature crop.

  • The USDA will release the export sales report on Thursday morning. Expectations are for the 23/24 marketing year sales to range from 500,000-1,100,000 mt as corn export demand has improved with freshly harvested supplies.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains between 490 – 516, with initial support between 475 – 480 and then near 460.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans have been finding buying interest around the June 2023 low of 1256 ¾, and since the beginning of October, they have also traded largely between 1260 and 1280. The close over 1287 ¼ on October 12 could be a signal that a harvest/fall low is in. In the big picture since May 2023, Nov ’23 has traded in a range from 1256 ¾ on the downside to 1435 on the topside. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately to around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • 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:

  • After trading on both sides of unchanged, soybeans surged higher to close out the day 14 ¼ cents in the green. This is the first close above 1300 since the end of September, as dryness continues in Argentina and the northern and central parts of Brazil.

  • Soybean meal traded sharply higher, gaining 14 dollars in the December, as technical buying ensued once the 400 level held after being tested midday. Soybean oil was the weak link of the complex that failed to successfully trade through its 20-day moving average, which brought out selling and profit taking from last week’s rally.

  • Northern and central Brazil are expected to remain dry for the rest of October, while southernmost region continues to be wet. Argentina, the world’s largest soybean meal exporter, is expected to see some much needed rain in the next two weeks, but the totals aren’t expected to break the current dryness.

  • This morning the USDA reported a flash sale to China for the 23/24 marketing year totaling 132,000 mt.

  • Abiove came out with its first estimate for Brazil’s 23/24 soybean crop and put it at a record 164.7 mmt, 7 mmt higher than the 22/23 crop. The group also estimated that Brazil would crush 54 mt and export 100 mt of soybeans in 2024.

  • Despite the robust harvest pace, basis levels have been seen rising at river terminals and processors due to slow farmer selling. Strong demand from crushers to maintain their vigorous processing pace and rising river levels on some regional rivers have helped to underpin basis.

Above: Front month soybeans have pierced the upper end of the 1285 – 1323 resistance area and are testing close in resistance at the 50-day moving average. If the market can maintain upward momentum, it would be poised to make a run to test mid-September prices around 1370. Otherwise, to the downside initial support may be found near 1300 and again near 1273. Key support for the move remains down near 1250.

Wheat

Market Notes: Wheat

  • More war premium is being factored into the grain markets, especially wheat, as the tensions rise in the Middle East. President Biden is in Israel to meet with foreign leaders, but following an attack on a hospital in Gaza, his meetings were cancelled.

  • So far in Australia, wheat yields are coming in a little better than what the USDA was estimating despite their drought issues. However, the impact may be minimal, with many analysts still looking for a decline in production of 40% or more. Argentina is also facing the implications of drought that may curb their production. They are expected to get some showers soon, but it will not be enough to reverse the current dry pattern.

  • Paris milling wheat futures closed higher for the fourth time in the past five sessions, with the front month December gaining 4.5 Euros to 240.50 per mt. This may indicate that they are finally breaking out of the sideways pattern, which should also lend support to the US market. Both US and French wheat are on an even playing field, in terms of export price for Nov – Jan, and there are rumors that China may be looking to purchase more US wheat. This is supported by the fact that China’s wheat imports this year so far are at 10.2 mmt, which is up 54% from last year.

  • Wheat harvest in southern Brazil, including the states of Rio Grande do Sul and Parana, has begun to ramp up. However, the southern regions have received too much rain, which has led to quality and disease concerns. According to CONAB, they are looking for Brazilian wheat output at 10.46 mmt. That is down 3.3% from the September projection, as well as down 0.9% from last year.

  • According to China’s National Bureau of Statistics, this year’s grain production may be a record due to rainfall received in the north. Additionally, China’s GDP data came out 0.5% better than expected at 4.9%. This may indicate that their economic situation is improving and that they will import more commodities – this may be in part why US grains rallied today. Conversely, there was also news that China approved new GMO corn and soybean seeds in an effort to become more self-sufficient, which may mean fewer imports in the future.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 Production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Grain Market Insider made sales recommendations in the late June rally around 720, and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading, due to fund positioning and weak fundamentals, has driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and 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 June’s highs, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year 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 Chicago wheat recommendations:

Above: After its push lower on Sept. 29, December wheat has slowly regained its value and is trading in the same 570 – 618 range it did prior to its break lower. For the market to push through the top side of the range, more bullish input will be needed. If so, the market would be poised to test the 645 – 664 area. If not and the market retreats, initial support could be found near 568 and then down between 547 and 540.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21. With weak U.S. export demand, driven by cheap Russian exports, being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750 it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Grain Market Insider made a sales recommendation in the late May rally around 1170. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800.  If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat. Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

To date, Grain Market Insider has issued the following K.C. recommendations:

Above: Since the end of September, K.C. wheat has been consolidating with initial support just below the market near the September 12 low of 655. If the market retreats lower and breaks through 655, the next levels of support come in around 630 and 575. Initial resistance to the upside may be found around 700 and again near 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat.  In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a nearly 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23.  The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July K.C. 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • 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: For much of September, December Minneapolis wheat was rangebound, and the breakout to the downside on September 29 set the market up to test support near 665, the May ’21 low. Since then, the market has been consolidating upward, with initial support between 711 and 708. If prices continue higher, initial resistance remains between 745 – 760.

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.

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

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Grain Market Insider: October 17, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Harvest pressure and resistance just above the market continue to weigh on the corn market with the December contract seeing choppy trade before settling just 1 ¼ cents off the low of the day.

  • Following through on Monday’s strength and with support from soybean meal, November soybeans punched through the 1300 level for the first time this month before falling back but still settling near the upper third of the range.

  • Soybean meal gained on oil today as spread traders likely took profits from long oil/short meal positions. December meal traded over 400 for the first time in a month before settling back below, as basis remains firm from strong export demand.

  • After trading on both sides of unchanged, the wheat complex settled near their respective lows of the day on continued demand concerns. SovEcon lowered its estimate of the Russian wheat crop by 0.2 mmt but still kept it well above the USDA’s current estimate. EU soft wheat exports remain behind year ago levels.

  • To see the current U.S. 7-day precipitation forecast, the 8 – 14 day Temperature and Precipitation Outlooks, and the average temperatures for South America from the NWS and NOAA, 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. The supportive USDA Supply and Demand report from October 12 had Dec ’23 corn testing that 500 psychological price level, yet so far Dec ’23 has been unable to close above it. That 500 level remains an important resistance area for the trend, and without a close over it, the market remains at risk of continuing to trend sideways to lower, and worst-case scenarios could entail sideways-to-lower trends into the late November to early January window. If Dec ’23 can close above 500, it may aim to test the next resistance near 547. Otherwise, the first support on the downside is the August low of 461. During last summer’s June rally, Grain Market Insider recommended making sales when Dec ’23 was around 624. So, for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now, Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 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:

  • Harvest pressure limited the corn market on the session, despite positive money flow into the soybean market, and the lack of fresh news kept corn buyers on the sidelines. December corn lost 1 cent on the session.

  • As of Sunday, the USDA saw corn harvest move to 45% complete, slightly below expectations, and limited by rainfall the second half of last week. With over half of the harvest to go, the market stayed pressured expecting additional fresh supplies.

  • Soybean futures tried to provide some support with double-digit gains and an increase in weather premium due to difficult conditions for some South American soybeans that helped lift the market but only could provide minimal support for the corn market.

  • Corn futures are trading in a range, bound between $4.90 and $4.80 in the short term. The market is looking for some news in either direction to trigger some price movement.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains between 490 – 516, with initial support between 475 – 480 and then near 460.

Corn percent harvested (red) versus the 5-year average (green) and last year (purple).

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. Front month soybeans have been finding buying interest around the June 2023 low of 1256 ¾, and since the beginning of October, they have also traded largely between 1260 and 1280. The close over 1287 ¼ on October 12 could be a signal that a harvest/fall low is in. In the big picture since May 2023, Nov ’23 has traded in a range from 1256 ¾ on the downside to 1435 on the topside. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately to around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • 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 and briefly broke above the 13-dollar mark. Support came from strong gains in soybean meal, while soybean oil was slightly lower. The trend has been higher since last week’s bullish WASDE report, with dry South American weather adding to the support.

  • Yesterday’s Crop Progress report showed the soybean harvest reaching 62% completion which is 10 points above the average pace as many producers get soybeans wrapped up ahead of corn. Iowa is 74% complete and Illinois 61% done. Crop ratings also improved by 1 point to 53%.

  • Yesterday’s NOPA crush report also bled into the bullishness of today after it was reported that 165.456 mb of soybeans were crushed in September, creating a new record high. Soybean oil stocks are also at their lowest levels since 2014 at a time when demand is increasing for use in biodiesels.

  • Attention is beginning to shift to South American weather and planting. Slight showers are forecast for the dry areas of Argentina and Brazil later in the week, but so far planting has not gotten off to a good start with conditions either too dry or too wet.

Above: October 12 soybeans were shocked higher and traded into the resistance area of 1285 – 1323. If the market can maintain upward momentum, it would be poised to make a run to test mid-September prices around 1370. Otherwise, initial support below the market remains near 1250, with key support coming in between 1180 – 1200.

Soybeans percent harvested (red) versus the 5-year average (green) and last year (purple).

Wheat

Market Notes: Wheat

  • Wheat closed mostly lower. Bear spreading was a noted feature in the Chicago contracts, as traders sold the nearby months and bought the deferred. This may be a reflection of the supply concerns down the road in South America and Australia caused by drought. It is noted, however, that there are better prospects for rain in Argentina this weekend which should bring some relief, though more will be needed.

  • Yesterday afternoon’s Crop Progress report indicated that US winter wheat planting was 68% complete, in line with the average pace, and 39% was emerged versus 43% on average. Elsewhere, Ukraine’s agriculture ministry is reporting that 65.2% of their 3.3 million hectares of winter grains are planted.  Of that total, 3.02 million is reported to be winter wheat, with the rest made up of mostly barley and rapeseed.

  • In Russia, Sov Econ slightly lowered their wheat crop estimate, but it is still higher than what the USDA is using. And the fact that Russia continues to offer cheap wheat to the world will keep US exports and futures prices under pressure for some time to come.  

  • South American weather is becoming more of a concern for corn and soybeans, as well as wheat. Central and northern Brazil are seeing continued dryness with certain areas along the Amazon River said to be at the lowest levels in over 100 years. And as long as the Amazon River basin remains dry, central Brazil should also remain dry. This has some analysts thinking that Brazil’s wheat production could be down by about 3.3% even though the planted area is 12.1% above last year.

  • India is reportedly dealing with its own weather problems and wheat supply concerns, which had internal wheat prices at an eight-month high. They will potentially need to increase imports down the road. China seems to be doing the same with rumors continuing to swirl that the country is looking to purchase more US soft wheat.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 Production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Grain Market Insider made sales recommendations in the late June rally around 720, and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading, due to fund positioning and weak fundamentals, has driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and 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 June’s highs, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year 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 Chicago wheat recommendations:

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market retreats lower, support below the market resides between 540 – 533.

Winter wheat percent planted (red) versus the 5-year average (green) and last year (purple).

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21. With weak U.S. export demand, driven by cheap Russian exports, being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750 it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Grain Market Insider made a sales recommendation in the late May rally around 1170. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800.  If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat. Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

To date, Grain Market Insider has issued the following K.C. recommendations:

Above: Since the end of September, K.C. wheat has been consolidating with initial support just below the market near the September 12 low of 655. If the market retreats lower and breaks through 655, the next levels of support come in around 630 and 575. Initial resistance to the upside may be found around 700 and again near 722.

Winter wheat percent planted (red) versus the 5-year average (green) and last year (purple).

Winter wheat percent emerged (red) versus the 5-year average (green) and versus last year (purple).

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat.  In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a nearly 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23.  The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July K.C. 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • 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: For much of September, December Minneapolis wheat was rangebound, and the breakout to the downside on September 29 set the market up to test support near 665, the May ’21 low. Since then, the market has been consolidating, and while support below the market remains near 665, initial support may also be found near 700. If prices turn higher, initial resistance remains between 745 – 760.

Other Charts / Weather

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

Brazil average temperature courtesy of the National Weather Service, Climate Prediction Center.

Argentina average temperature courtesy of the National Weather Service, Climate Prediction Center.

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Grain Market Insider: October 16, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • The corn market followed through on Friday’s small losses and sold off in the day session after trading higher early on Sunday evening. Low export inspections, that came in well below expectations and at a marketing year low, added to the pall of the market.

  • Record September crush from today’s NOPA crush report and a marketing year high for export inspections kept the soybean market supported through the day, though neighboring corn and wheat likely added resistance.

  • Today’s sharp gains in soybean oil are likely due to the record crush numbers and lower than expected bean oil stocks that imply that much of the crushing activity is for oil, and that demand from the biofuel sector remains strong. While on the flip side, the resulting excess meal production weighed on meal prices, producing only modest gains near unchanged.

  • While export inspections were in line with expectations, they still fell below the pace required to meet the USDA’s estimates, and are 28% behind year ago levels, versus the USDA’s forecast of an 8% decline. This in addition to higher Russian wheat production estimates dragging on the wheat complex, which had a strong start overnight trade but finished on the weak side. Minneapolis contracts settled in the green, with Chicago and K.C. lower.

  • To see the current U.S. 5-day precipitation forecast, the 6 – 10 day Temperature and Precipitation Outlooks, and the 1 week precipitation forecasts for South America from the NWS and NOAA, 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. Last week’s supportive USDA Supply and Demand report had Dec ’23 corn testing that 500 psychological price level, yet so far Dec has been unable to close over that resistance. That 500 level remains an important resistance for the trend, and without a close over it, the market remains at risk of continuing to trend sideways-to-lower. The worst-case scenarios from a timing perspective, could entail sideways-to-lower into the late November to early January window. If Dec ’23 can reverse the slide of the last two days and close over 500, the next resistance would be 547. First support on the downside is the August low of 461. If you’re new to Grain Market Insider and were not a subscriber during this summer’s rally, Grain Market Insider did recommend making sales into that rally when Dec ’23 was around 624. So, for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until next spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now, Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 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 failed to find any traction to start the week as prices consolidated at the top of last week’s trading range.  Dec corm lost 3 ¼ cents to $4.90 on the session. The grain market lacked any true momentum to start the week.

  • Weekly export inspections released by the USDA on Monday morning saw soft action last week at 435,000 mt (17.1 mb), which was below market expectations. Total inspections for the marketing year are at 155 mb, up 19% year-over-year, but still behind pace to reach the USDA target for the marketing year at 2.025 billion bushels.

  • Demand news overall has helped support prices with an uptick in activity. USDA announced a flash sale of 200,000 mt (7.87 mb) to Mexico on the overnight, as Mexico has remained active in the corn export market with routine purchases.

  • Despite end of week rainfall, US corn harvest is expected to move to 46% complete on the weekly USDA crop progress report. Weather forecasts give a window for some progress again early this week, but good rainfall over the weekend may limit some field activity.

  • Harvest pressure still limits the corn market with less than 50% of the harvest completed. Potential rallies in the corn market are limited by producer selling.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains between 490 – 516, with initial support between 475 – 480 and then near 460.

Corn Managed Money Funds net position as of Tuesday, Oct.10. Net position in Green versus price in Red. Managers net bought 46,742 contracts between Oct. 4 – 10, bringing their total position to a net short 112,691 contracts.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. The Nov ’23 contract has been finding buying interest around the June 2023 low of 1256 ¾, and since the beginning of October, it has also traded largely between 1260 and 1280. The close over 1287 ¼ on October 12 could be a signal that a harvest/fall low is in. The bigger picture, since May 2023, Nov ’23 has traded in a range from 1256 ¾ on the downside to 1435 on the topside. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately to around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • 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 closed higher today after trading lower earlier in the day. Support came from the NOPA crush report which saw soybean oil stocks lower than expected. Export inspections today were supportive as well. Both soybean meal and oil finished the day higher.

  • Weekly soybean inspections came in at an impressive 2,011,589 tons which was well above the high end of the trade guesses. This comes as a larger number of soybeans are getting shipped out of the PNW to China and other countries with Brazilian soybean supplies tight.

  • Today’s NOPA crush report saw 165.456 million bushels of soybeans crushed in September, above the average trade guess of 161.683 mb and a new record for September. Soybean oil stocks came in at 1.108 billion pounds which is the lowest soybean oil stocks number since December 2014 and below the average trade guess.

  • For the week ending October 10, non-commercial traders were sellers of 2,831 contracts of soybeans reducing their net long position to 2,170 contracts. In the wake of the bullish WASDE report last Thursday, it is more likely that those funds began buying and increased their net long position since the report which showed soybean yields at just 49.6 bpa and ending stocks at 220 mb.

Above: October 12 soybeans were shocked higher and traded into the resistance area of 1285 – 1323. If the market can maintain upward momentum, it would be poised to make a run to test mid-September prices around 1370. Otherwise, initial support below the market remains near 1250, with key support coming in between 1180 – 1200.

Soybean Managed Money Funds net position as of Tuesday, Oct. 10. Net position in Green versus price in Red. Money Managers net sold 2,835 contracts between Oct. 4 – 10, bringing their total position to a net long 2,166 contracts.

Wheat

Market Notes: Wheat

  • Although it was a relatively quiet session, wheat closed mostly negative. This may be due in part to IKAR increasing their estimate of Russian grain production to 141.6 mmt. Despite this increase that should keep Russia competitive on exports, there are rumors that China is looking to potentially buy more US wheat after last week’s 181,000 mt purchase. China is expecting heavy rains over the next week or so in their grain regions, and this has the potential to affect their corn and wheat crops.

  • Weekly wheat inspections of 13 mb bring the total 23/24 inspections to 248 mb. That is down 28% from last year, and so far, inspections are running behind the pace needed to meet the USDA’s export estimate of 700 mb.

  • Argentina is already struggling with drought that will affect their crops, and as long as the Amazon basin stays dry, central Brazil should remain dry as well. While central and northern Brazil are experiencing dry conditions, southern Brazil remains too wet. Additionally, with Australia having their own drought problems, there is talk that in 2024, wheat stocks of the major exporting countries will be the lowest in 16 years, which should be bullish for the market.

  • From a technical standpoint, even though December Chicago wheat has closed over the 21-day moving average for the second day since the end of July, significant resistance remains at the six dollar level. Aside from the negative influence of last week’s report, the uncertainty in the Middle East could also affect the wheat market as the conflict ramps up given that wheat is more of a staple in that part of the world.

  • According to the Ukrainian government, since July, Russia has destroyed about 300,000 mt of grain during their attacks on port infrastructure and vessels.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 Production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Grain Market Insider made sales recommendations in the late June rally around 720, and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading, due to fund positioning and weak fundamentals, has driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and 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 June’s highs, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Grain Market Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year 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 Chicago wheat recommendations:

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market retreats lower, support below the market resides between 540 – 533.

Chicago Wheat Managed Money Funds net position as of Tuesday, Oct. 10. Net position in Green versus price in Red. Money Managers net sold 5,547 contracts between Oct. 4 – 10, bringing their total position to a net short 104,335 contracts.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21. With weak U.S. export demand, driven by cheap Russian exports, being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750 it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Grain Market Insider made a sales recommendation in the late May rally around 1170. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800.  If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat. Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

To date, Grain Market Insider has issued the following K.C. recommendations:

Above: Since the end of September, K.C. wheat has been consolidating with initial support just below the market near the September 12 low of 655. If the market retreats lower and breaks through 655, the next levels of support come in around 630 and 575. Initial resistance to the upside may be found around 700 and again near 722.

K.C. Wheat Managed Money Funds net position as of Tuesday, Oct. 10. Net position in Green versus price in Red. Money Managers net sold 2,043 contracts between Oct. 4 – 10, bringing their total position to a net short 25,870 contracts.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat.  In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a nearly 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23.  The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July K.C. 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • 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: For much of September, December Minneapolis wheat was rangebound, and the breakout to the downside on September 29 set the market up to test support near 665, the May ’21 low. Since then, the market has been consolidating, and while support below the market remains near 665, initial support may also be found near 700. If prices turn higher, initial resistance remains between 745 – 760.

Minneapolis Wheat Managed Money Funds net position as of Tuesday, Oct. 10. Net position in Green versus price in Red. Money Managers net sold 2,520 contracts between Oct. 4 – 10, bringing their total position to a net short 23,506 contracts.

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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Grain Market Insider: October 13, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • The failure to trade above 500 resistance in the December corn contract likely led to profit taking from yesterday’s gains, despite decent export sales that put the total commitments up 14% over last year, but still behind the USDA’s forecast of a 22% increase.

  • Soybean oil traded sharply higher on higher crude oil that showed 5.6% gains from greater Middle East uncertainty. While the strength in bean oil led to a 14 ½ cent gain in December Board crush margins, it didn’t spill over to support meal or soybeans, which succumbed to profit taking from yesterday’s gains and ahead of any potential headline risk over the coming weekend.

  • The wheat complex closed the day mixed with Chicago higher, while both Minneapolis and KC finished lower. With a reasonably large short fund position, Chicago contracts may be seeing short covering ahead of potential headline risk over the weekend, whereas Minneapolis and KC likely saw profit taking in the wake of Thursday’s strong performance off of neutral to bearish domestic USDA supply and demand numbers.

  • To see the current U.S. 7-day precipitation forecast and 8 – 14 day Temperature and Precipitation Outlooks from the NWS and NOAA, 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. In the last couple weeks Dec ’23 corn has seen a bump from a low of 467 ¾ to a high of 499. Since mid-August, the psychological 500 level has served as market resistance on the front month. Without any more bullish input, the market remains at risk of sideways to lower price action. In years without bullish fundamental tailwinds at this time of year, the worst case scenarios have seen prices trend slowly lower into anywhere from late November to early January. If you’re new to Grain Market Insider and were not a subscriber during this summer’s rally, Grain Market Insider did recommend making sales into that rally when Dec ’23 was around 624. So for now, the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Grain Market Insider may sit tight on the next sales recommendations until next spring. If you end up harvesting more bushels than you can store this fall and must move them, consider protecting those sold bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now, Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as for 2023 prices, which is a continuation of a lower trend without further bullish input. Grain Market Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Grain Market Insider recommended buying 560 and 610 Dec ’23 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.

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • The corn market saw some end-of-the-week profit taking, as it faded off the top end of the Thursday price range. December corn closed 2 ¾ cents lower but finished the week with a small 1 ¼ cent gain.

  • The USDA released weekly export sales on Friday morning. Corn sales last week were above expectations at 910,000 mt (35.8 mb) and 87,400 mt (3.4 mb) for 2024-25. Total sales commitments for 23/24 are at 602 mb, up 14% from last year’s levels, but still behind the pace needed to reach the USDA export target of 2.025 billion bushels.

  • A strong move higher in crude oil prices helped limit corn selling pressure. Ethanol margins remain positive and have been helping support the corn market.

  • On Thursday, the USDA lowered expected corn yield to 173.0 bushels/acre and reduced corn carryout 2.111 billion bushels for the 23/24 marketing year. The friendly report has corn prices challenging resistance over top prices at 498 ¾. This is a key technical barrier and if broken could allow prices to push higher on short covering.

  • Harvest pressure limits the market’s upside. Rainfall across the Corn Belt on Friday likely limited harvest progress on Friday. Last week, the corn harvest was 34% complete, and that number should push higher with a strong harvest pace in the front half of the week. The next harvest pace number will be released in Monday’s USDA Crop Progress report.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains between 490 – 516, with initial support between 475 – 480 and then near 460.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. The Nov ’23 contract has been finding buying interest around the June 2023 low of 1256 ¾, and since the beginning of October, it has also traded largely between 1260 and 1280. The close over 1287 ¼ on October 12 could be a signal that a harvest/fall low is in. The bigger picture, since May 2023, Nov ’23 has traded in a range from 1256 ¾ on the downside to 1435 on the topside. Last summer, Grain Market Insider did make two sales recommendations in the 1310 – 1360 price window versus Nov ’23. Given that those sales recommendations were made and given that now is not the time of year to be making many sales, if any, Grain Market Insider is content to hold tight on any further sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider protecting any sold bushels with July or Aug ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately to around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Grain Market Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Grain Market Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans ended the day lower following a higher start due to likely end-of-week profit taking and some weakness in soybean meal. Soybean oil closed higher thanks to big gains in crude oil. For the week, November soybeans gained 14-1/4 cents, December meal gained 17.90, and soybean oil lost 0.97.

  • The big bullish news of the week was the WASDE report which saw the national yield at just 49.6 bpa, down from the USDA’s last guess of 50.1 bpa. Ending stocks remained at a very tight 220 mb, and world ending stocks fell much further than anticipated. If exports increase through the end of the year, the soybean market could be poised to rally.

  • Today’s export sales report was very supportive, with soybean sales at 1.057 mmt, above the upper end of trade estimates, and total soy exports at 1.44 mmt. In addition, daily sales totaling 117,300 mt of soybeans were reported for delivery to unknown destinations for 23/24, and 100,000 mt of soybean cake and meal were reported for delivery to unknown destinations for 23/24.

  • With soybeans out of the PNW becoming more competitive, China appears to have stepped up its U.S. purchases. Offers out of the PNW are reportedly 30 cents cheaper than Brazilian offers for November and with Brazil’s soybean supplies running low, now is the window for the U.S. to increase exports. 

Above: October 12 soybeans were shocked higher and traded into the resistance area of 1285 – 1323. If the market can maintain upward momentum, it would be poised to make a run to test mid-September prices around 1370. Otherwise, initial support below the market remains near 1250, with key support coming in between 1180 – 1200.

Wheat

Market Notes: Wheat

  • Overall wheat had a mixed close today. Chicago futures finished higher alongside Matif wheat, however, Minneapolis and KC contracts posted losses. This may be a delayed reaction to yesterday’s report which wasn’t necessarily bullish for wheat on the U.S. numbers alone. However, the reduction in global production is lending a helping hand to the market.

  • The USDA reported an increase of 24.0 mb of wheat export sales for 23/24, but last week’s shipments at 12.6 mb were behind the 13.8 mb per week pace needed to meet the USDA’s 23/24 export goal of 700 mb.

  • This morning, private exporters reported sales of 181,000 mt of U.S. SRW wheat for delivery to China during the 23/24 marketing year. This is the second recent sale to China, suggesting that U.S. wheat has become more competitive on the global market.

  • The USDA left the Russian wheat crop unchanged at 85 mmt despite some higher private estimates, and they also kept Argentina’s production unchanged at 16.5 mmt in the face of a 14.8 mmt estimate by the Rosario Grain Exchange. This is also despite the growing concern over drought in that region. Interestingly, the USDA did reduce Australia’s crop for the same reason – drought.

  • December Chicago wheat today closed above the 21-day moving average for the first time since the end of July. From a technical perspective, this may indicate that wheat has a near-term bottom in place.

  • Ukraine’s grain harvest is said to have reached 31% complete with 35.6 mmt of grain collected. Of that total, 22.2 mmt is said to be wheat. Elsewhere, the French soft wheat crop is said to be 17% planted as of October 9th, up from 3% last week, but behind last year’s pace of 19%.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July, but has found support near 541 following the September 29 Production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Grain Market Insider made sales recommendations in the late June rally around 720, and again earlier this fall near 604. With those two sales, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading, due to fund positioning and weak fundamentals, has driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Grain Market Insider recommended purchasing July 590 puts to prepare for this possibility, and 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 June’s highs, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market retreats lower, support below the market resides between 540 – 533.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21.  With weak U.S. export demand, driven by cheap Russian exports, being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750 it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Grain Market Insider made a sales recommendation in the late May rally around 1170. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800.  If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat. Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August, Grain Market Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July, Grain Market Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. 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 some of the original cost and move toward a net neutral cost for the remaining position.

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

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the end of September, K.C. wheat has been consolidating with initial support just below the market near the September 12 low of 655. If the market retreats lower and breaks through 655, the next levels of support come in around 630 and 575. Initial resistance to the upside may be found around 700 and again near 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a downtrend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Grain Market Insider made a sales recommendation during the July rally near 820. With that sale, Grain Market Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Grain Market Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat.  In the last three months, the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to a nearly 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23.  The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Grain Market Insider recommended purchasing July K.C. 660 puts (for their greater liquidity, and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Grain Market Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Grain Market Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Grain Market Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • 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.

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: For much of September, December Minneapolis wheat was rangebound, and the breakout to the downside on September 29 set the market up to test support near 665, the May ’21 low. Since then, the market has been consolidating, and while support below the market remains near 665, initial support may also be found near 700. If prices turn higher, initial resistance remains between 745 – 760.

Other Charts / Weather

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

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Grain Market Insider: October 12, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Friendly supply and demand numbers from today’s USDA WASDE report, a reported sale of almost 125,000 mt of corn to Guatemala, and carryover strength from soybeans lifted corn to within 1 ¼ cents of 500, before it closed 8 cents higher on the day.

  • A surprise move, from the USDA that kept U.S. soybean ending stocks unchanged from last month, where a 13 mb increase was expected, and an additional sale of 295,000 mt to unknown destinations fueled the fire for a 37-cent rally in November soybeans.

  • Both soybean meal and oil were strong performers today, lending additional support to soybeans. The USDA left meal ending stocks unchanged from last month, but increased exports by 200,000 tons, while bean oil ending stocks were reduced by 85 mil lbs.

  • Spillover strength from sharply higher soybeans, and higher corn, supported all three wheat classes to close near the top of their respective ranges despite a neutral to bearish U.S. supply and demand update from the USDA.

  • To see the current U.S. 5-day precipitation forecast and 6 – 10 day Temperature and Precipitation Outlooks from the NWS and NOAA, 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. The last couple weeks Dec ’23 corn has seen a bump from a low of 467.75 to a high last week of 499.00. Since mid-August, the psychological 500.00 level has served as market resistance on the front month. Without any bullish catalyst from the coming USDA Supply and Demand report this Thursday, the market remains at risk of sideways to lower price action. In years without bullish fundamental tailwinds at this time of year, the worst case scenarios have seen prices trend slowly lower into anywhere from late November to early January. If you’re new to Insider and were not a subscriber during this summer’s rally, Insider did recommend making sales into that summer rally when Dec ’23 was around 624.00, so for now the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Insider may sit tight on the next sales recommendations until next spring. If you end up harvesting more bushels than you can store this fall and must move them, consider re-owning those bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as 2023 prices, which is a continuation of a lower trend without a bullish catalyst on this Thursday’s Supply and Demand report. Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Insider recommended buying 560 and 610 Dec ’23 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 700.00 or 800.00 that the call options would protect those sold bushels. 

  • No Action is currently recommended for 2025 corn. 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 Insider starts considering the first sales targets.

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Corn futures used a friendly USDA report and a strong soybean market to post moderate gains on the session. December corn gained 8 cents to $4.96 but failed to push through overhead resistance at $4.98 ¾ from last week.

  • The USDA lowered expected corn yield to 173.0 bushels/acre, down 0.8 bushels from last month and below market expectations. Yield losses from last year were noted in many corn producing states, but Missouri (-12.4%), Minnesota (-8.2%) and Illinois (-6.5%) were key states impacted by this season’s overall hot and dry weather.

  • The reduced yield lowered overall production by 70 mb versus last month. The combination of lower production and lower than expected grain stocks on September 29th, lowered corn carryout to 2.111 bb. This was down 210 mb from last month and 27 mb below expectations. In order to reach the final carryout total, the USDA lowered feed usage and export demand by 25 MB for each category.

  • Corn harvest pace moved to 34% complete on the weekly crop progress numbers. The weather forecasts have kept the harvest pace strong for the first half of the week, but projected moisture in the 2nd half of the week, and into the weekend, may likely slow harvest progress going into next week for north and central areas of the Corn Belt

  • The USDA will release weekly export sales on Friday morning. Corn export sales for the last week are expected to range from 600,000 – 900,000 mt for new crop and up to 150,000 mt for the 24/25 marketing year. Weekly ethanol demand saw good production as corn used for ethanol grind is trending 5.1% above last year’s levels.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 490 – 516, and support below the market may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. The Nov ’23 contract has been finding buying interest around the June 2023 low of 1256.75 on the front month. Over the last seven trading days, Nov ’23 has traded largely between 1260.00 and 1280.00.  If there were to be a bullish catalyst from this Thursday’s USDA Supply and Demand report and Nov ’23 subsequently closed over 1287.25, that could signal the possibility that a harvest/fall low is in. Bigger picture, since May 2023, the front month contract has traded in a range from 1256.75 on the downside to 1435.00 on the topside. If you are a newer subscriber to Insider and were not with us back in the summer, Insider did make two sales recommendations in the 1310-1360 price window versus Nov ’23. Given those sales recommendations were already made and given that now is not the time of year to be making many if any sales, Insider is content to hold tight on next sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider buying those sold bushels back with July or August ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • No Action is currently recommended for 2025 Soybeans. 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans posted a significantly higher close today, fueled by a bullish WASDE report and big gains in soybean meal. Soybean oil was higher too, but larger gains may have been held back by lower crude oil and continued weakness in world veg oil prices. November soybeans had a sharp reversal and closed at the 20-day moving average.

  • Today’s WASDE report featured several bullish surprises for soybeans. Yield was pegged at 49.6 bpa, below trade expectations and far below the most recent guess of 50.1 bpa. Production was lowered, and soybean ending stocks were held steady from September at a very tight 220 mb, below trade expectations. World ending stocks were also lowered to 115.62 mmt from last month’s guess of 119.25 mmt.

  • With U.S. soybean ending stocks so tight at 220 mb, further increases in demand could add more bullish fuel to the market. China has already been a more active buyer of soybeans out of the PNW as Brazilian supplies dwindle.

  • In South America, Argentina remains very dry from last season and this trend is not expected to improve. Northern Brazil is also too dry, while the southern regions are too wet, and this comes as planting is underway. It may be too early to focus on South American weather, but it will come into focus in the coming months and could drive prices higher if the weather pattern doesn’t improve.

Above: Since the end of August, the soybean market has been in a downtrend, and though it has been consolidating, it remains oversold, which can be supportive if prices turn higher. Initial support to the downside lies near the recent low of 1254, with further support between 1238 – 1214, while resistance above the market lies between 1285 – 1323. 

Wheat

Market Notes: Wheat

  • Today’s USDA report elicited a bullish reaction after some of the numbers came in below expectations. Wheat was more of a mixed bag but still was able to partake in the upswing. U.S. 23/24 wheat carryout came in at 669 mb, above expectations of 646 mb and 615 mb in September. World 23/24 ending stocks were reduced slightly from 258.6 mmt in September to 258.1 mmt. However, the USDA did lower global wheat production by almost 4 mmt to 783.43 mmt.

  • With today’s data out of the way the question is, can this rally be sustained? Often the market has a kneejerk reaction on report day but may set back once the dust settles. One thing that could continue to weigh on the market is continued high inflation. Today’s CPI data came in at 3.7%, a little more than expected. In turn, the U.S. Dollar Index jumped higher today and if it continues the trend higher, it will add more pressure to wheat.

  • Rumors that China is asking for U.S. SRW wheat pricing out of the Gulf is an encouraging sign that the recent low prices may have stimulated some buying interest. It remains to be seen if this rumor will be confirmed or not, but the export side of the market could use a boost. The USDA left their wheat export estimate unchanged in the report at 700 mb.

  • The developing war in the Middle East, and the uncertainty between Russia and Ukraine, are both factors that could continue to affect commodity markets, especially wheat. Russia continues to overshadow other exporters, with reports that private offers are as low as $235 per metric ton, despite their government’s preferred $270 floor.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Insider made sales recommendations in the late June rally around 720 and again earlier this fall near 604. With those two sales, Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Currently, July ’24 is trading at a 68-cent premium to the Dec ’23 contract as bear spreading due to fund positioning and weak fundamentals have driven the Dec ’23 contract closer to 550, while the July ’24 contract remains near 625. The risk for the July ’24 contract remains the same as for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. At the end of August, Insider recommended purchasing July 590 puts to prepare for this possibility, and back in June, 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 June’s highs, Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further, and Insider will be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 Chicago Wheat. Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year from now. It will probably be mid-winter before Insider starts considering the first sales targets.

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market breaks further, support below the market resides between 533 – 524.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C. wheat crop. The Dec ’23 contract has been in a down trend since making highs in late July and continues to search for support while trading about 40 cents off the contract lows from July ’21. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 750, it may signal that a fall low is in place which would line up with the historical tendency for prices to appreciate into winter and early spring. Earlier this year, Insider made a sales recommendation in the late May rally around 1170. With that sale, Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales north of 700, and again around 750 – 800. If at that point the market remains strong and continues to rally, Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 K.C. wheat.  Currently, July ’24 is trading at an 18-cent premium to the Dec ’23 contract, up from a 60-cent discount last July, as bear spreading due to weak fundamentals has driven the Dec ’23 contract closer to its contract lows, while the July ’24 contract remains more elevated as it tests Feb ’22 lows. The risk for the July ’24 contract is much like that for Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode, and in mid-August Insider recommended purchasing July 660 puts to prepare for this possibility. Also, back in July Insider recommended a sale near 800 to take advantage of elevated prices before they eroded further. If the market receives the needed stimulus to move prices back toward 800, Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further and Insider will be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

  • No action is currently recommended for 2025 K.C. Wheat. Insider isn’t considering any recommendations at this time for the 2025 crop that will be planted a year from now. It will probably be mid-winter before Insider starts considering the first sales targets.

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the end of September, K.C. wheat has been consolidating after finding initial support just below the market near 660. If the market resumes its downtrend, the next levels of support below 660 come in around 630 and then 575, while resistance to the upside may be found between 710 – 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. The Dec ’23 contract has been in a down trend since making highs in late July and continues to search for support while showing signs of being oversold. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, the market is in need of bullish input to stabilize and rally prices back higher. If a bullish catalyst were to enter the market and push prices towards 800, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into winter. Earlier this year, Insider made a sales recommendation near 820 in the July rally. With that sale, Insider’s strategy is to look for price appreciation going into this winter with an eye on considering additional sales around 750 – 800, and again north of 825. If at that point the market remains strong and continues to rally, Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is currently recommended for 2024 Minneapolis wheat. In the last three months the Sep ’24 contract has gone from a 60 – 80 discount to Dec ’23, to nearly a 60-cent premium. Weak fundamentals led bear spreading to drive Dec ’23 in search of new contract lows, while Sep ’24 remains nearly 30 cents off its low from last June. The risk for the Sep ’24 contract is much like that of Dec ’23. The market needs bullish input to move prices higher, and without it, prices may continue to erode. In mid-August, Insider recommended purchasing July K.C. 660 puts (for their greater liquidity and correlation to Minneapolis pricing) to prepare for this possibility, and back in July, Insider recommended a sale near 815 to take advantage of elevated prices. If the market receives the needed stimulus to move prices back toward 800, Insider is prepared to recommend adding to current sales levels. Otherwise, the current recommended put position will add a layer of protection if prices erode further. Insider will then be prepared to recommend covering some of those puts to offset some of the original cost and move toward a net neutral cost for the remaining position.

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

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since early September, Dec Minneapolis wheat has been largely rangebound, and the recent breakout to the downside on September 29 has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.

Other Charts / Weather

U.S. 5-day precipitation forecast courtesy of NOAA, Weather Prediction Center.

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Grain Market Insider: October 11, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Positioning ahead of tomorrow’s USDA WASDE report lent support to the corn market as traders anticipate a slightly lower carryout, while a swift harvest pace, and weakness in wheat, soybeans, and crude oil added upward resistance to corn prices, as the market settled just off the day’s highs.

  • After trading higher in the overnight session, and despite two flash sales totaling 12 mb, November soybeans traded lower throughout the day to close near the bottom of the range on harvest pressure, and as traders set positions in anticipation of potentially bearish USDA numbers in tomorrow’s report.

  • After trading on both sides of unchanged, soybean meal closed lower on the day, though just a mere 40 cents/ton. While further contributing to a weaker soybean trade, soybean oil continued its slide lower on weaker world veg oils and lower biofuel RIN values.

  • Position squaring led the day with two-sided trade that had all three wheat classes closing in the red as traders anticipate higher ending stocks in tomorrow’s USDA report.

  • To see the current U.S. 6 – 10 day Temperature and Precipitation Outlooks, and South American average temperatures from the NWS and NOAA, 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. The last couple weeks Dec ’23 corn has seen a bump from a low of 467.75 to a high last week of 499.00. Since mid-August, the psychological 500.00 level has served as market resistance on the front month. Without any bullish catalyst from the coming USDA Supply and Demand report this Thursday, the market remains at risk of sideways to lower price action. In years without bullish fundamental tailwinds at this time of year, the worst case scenarios have seen prices trend slowly lower into anywhere from late November to early January. If you’re new to Insider and were not a subscriber during this summer’s rally, Insider did recommend making sales into that summer rally when Dec ’23 was around 624.00, so for now the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Insider may sit tight on the next sales recommendations until next spring. If you end up harvesting more bushels than you can store this fall and must move them, consider re-owning those bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as 2023 prices, which is a continuation of a lower trend without a bullish catalyst on this Thursday’s Supply and Demand report. Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Insider recommended buying 560 and 610 Dec ’23 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 700.00 or 800.00 that the call options would protect those sold bushels. 

  • No Action is currently recommended for 2025 corn. 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 Insider starts considering the first sales targets.

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • In pre-USDA report trade, corn futures saw prices trade higher as funds were likely squaring positions for tomorrow’s report. December corn added 2 ½ cents as weakness in wheat, soybeans, and crude oil markets limited gains on the session.

  • The USDA will release the latest crop production and supply/demand numbers on Thursday morning.  Expectations are for corn yield to be trimmed slightly to 173.5 bushels/acre. The lower possible production, plus the tighter than expected grain stocks should lower corn carryout slightly to an expected 2.138 billion bushels.

  • Corn harvest pace moved to 34% complete on the weekly crop progress numbers. This was slightly below market expectations, but ahead of the 5-year average of 31%. The ongoing harvest pressure added resistance to the market’s upside potential.

  • The weather forecasts have kept the harvest pace strong for the first half of the week, but projected moisture in the 2nd half of the week, and into the weekend, may slow harvest progress going into next week for north and central areas of the Corn Belt.

  • South American weather will become a potential factor after Thursday’s USDA report. Dry weather in the north and excessive moisture in the south regions may slow soybean planting, which could push back the 2nd crop corn planting. The weather concerns are extremely early in the crop year but could be more important as the market moves closer to the end of the year.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 490 – 516, and support below the market may be found near 460 and again near 415.

Corn condition percent good-excellent (red) versus the 5-year average (green) and last year (pink).

Corn percent harvested (red) versus the 5-year average (green) and last year (purple).

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. The Nov ’23 contract has been finding buying interest around the June 2023 low of 1256.75 on the front month. Over the last seven trading days, Nov ’23 has traded largely between 1260.00 and 1280.00.  If there were to be a bullish catalyst from this Thursday’s USDA Supply and Demand report and Nov ’23 subsequently closed over 1287.25, that could signal the possibility that a harvest/fall low is in. Bigger picture, since May 2023, the front month contract has traded in a range from 1256.75 on the downside to 1435.00 on the topside. If you are a newer subscriber to Insider and were not with us back in the summer, Insider did make two sales recommendations in the 1310-1360 price window versus Nov ’23. Given those sales recommendations were already made and given that now is not the time of year to be making many if any sales, Insider is content to hold tight on next sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider buying those sold bushels back with July or August ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • No Action is currently recommended for 2025 Soybeans. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans ended the day lower and were below the previous low of 12-56-3/4 from June as they are under pressure from harvest and in anticipation of tomorrow’s WASDE report. Both soybean meal and oil were lower with pressure from crude oil and world veg oils.

  • Estimates for Thursday’s WASDE report call for soybean yields to fall slightly to 49.9 bpa from 50.1 bpa in last month’s estimate. Production is expected to be lowered slightly to 4.134 bb. It is unknown if the USDA will make adjustments to demand in this report.

  • World veg oil prices continue to be weak as Ukrainian sunflower oil’s premium to palm oil fell to just $45/mt from $400 in recent days. Additionally, here in the U.S., lower biofuel RIN values continue to weigh on bean oil prices. 

  • Brazil is currently in the middle of planting and early estimates are calling for a record 23/24 production of 162 mmt, but the country continues to deal with weather issues. In the northern region, light showers are expected but it is likely not enough, and in the southern region conditions remain far too wet.

  • On the heels of yesterday’s impressive export inspections number of 1.036 mmt, sales were reported today of 121,000 mt of soybeans for delivery to China for the 23/24 period, and 213,000 mt for delivery to unknown destinations for the 23/24 marketing year. U.S. exports have picked up recently out of the PNW as Brazil runs tight on supplies.

Above: Since the end of August, the soybean market has been in a downtrend, and though it has been consolidating, it remains oversold, which can be supportive if prices turn higher. Initial support to the downside lies near the recent low of 1254, with further support between 1238 – 1214, while resistance above the market lies between 1285 – 1323. 

Soybeans condition percent good-excellent (red) versus the 5-year average (green) and last year (pink).

Soybeans percent harvested (red) versus the 5-year average (green) and last year (purple).

Wheat

Market Notes: Wheat

  • Tomorrow traders will receive the latest USDA data on the WASDE report. Pre-report estimates of U.S. 23/24 wheat carryout come out to an average of 646 mb, compared to 615 mb in September. The world 23/24 average carryout estimate is projected at 258.8 mmt, up just slightly from 258.6 mmt last month.

  • According to the USDA, winter wheat planting is 57% complete with 29% of the crop emerged. With most of the Midwest dry, there is some concern about emergence. However, some rain across the upper Midwest and northern Plains is expected over the coming days.

  • Even though western Australia is too dry, and it is affecting their wheat production, Australian wheat futures are actually trading lower as yields are coming in better than expected.

  • With low global prices in general, it will be a tough road ahead to see U.S. futures rally. Russia continues to dominate exports, with talk of a sale to Egypt for 480,000 mt at $265 per ton FOB. In response to this sale, EU wheat is said to have dropped to just $250 per ton.

  • In contrast to the above point, SovEcon believes Russia’s wheat exports are expected to decline due to slowing demand. This could be tied to their Ministry of Agriculture trying to prevent sales below the $270 per ton price floor. Russia’s October wheat exports may be 3.9-4.4 mmt, down from 4.5 mmt last year.

  • For the 23/24 season, French soft wheat exports are expected to rise to 17.25 mmt, versus a projected 17.16 mmt in September. This is according to the French crop office, FranceAgriMer. In addition, stocks were reduced to 2.77 mmt vs 2.92 mmt previously.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The Dec ’23 contract has been in a downtrend since making highs in late July but has found support near 541 following the September 29 production report and has since been rangebound between 541 and 581 ½. With weak U.S. export demand driven by cheap Russian exports being the dominant headwind, it appears that prices may be finding value in the current trading range. If a bullish catalyst were to enter the market and push prices over 616, it may signal that a fall low is in place, which would line up with the historical tendency for prices to appreciate into the winter months. If you are a newer subscriber, Insider made sales recommendations in the late June rally around 720 and again earlier this fall near 604. With those two sales, Insider’s strategy is to look for price appreciation going into this winter as weather becomes a more prominent market mover, with an eye on considering additional sales in the 600 – 650 range. If at that point the market remains strong and continues to rally, Insider will consider potential re-ownership strategies to protect current sales and add confidence to make additional sales at higher prices.

  • No new action is recommended for 2024 Chicago wheat. Considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. There is plenty of time to market the 2024 crop and with the world stocks to use ratio at an 8-year low, many uncertainties remain that could shock prices higher, like geopolitical instability and dryness in the southern hemisphere. If prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 750, if not, and prices make new lows, unsold bushels will be protected by the recommended July ’24 590 puts.

  • No action is currently recommended for 2025 Chicago Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market breaks further, support below the market resides between 533 – 524.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C wheat crop. Since the end of May the wheat market has been influenced by weak demand, changing headlines from the Black Sea region, and the corn market with its own demand and weather concerns. With harvest in the bin, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region and the southern hemisphere, which could push prices in either direction. While Insider will continue to monitor the downside for any breach of major support, we would need to see prices pushed toward 700 – 750 before considering any additional sales.

  • No new action is recommended for 2024 K.C. wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian exports continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further, while war persists in the Black Sea region, and production concerns continue in the southern hemisphere due to El Nino. With the world stocks to use ratio at an 8-year low, there are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 660 puts, unsold bushels will be protected if prices make new lows, and Insider will also be looking for opportunities to consider recommending additional sales if prices turn around and rally north of 775. 

  • No action is currently recommended for 2025 KC Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the end of September, K.C. wheat has been consolidating after finding initial support just below the market near 660. If the market resumes its downtrend, the next levels of support below 660 come in around 630 and then 575, while resistance to the upside may be found between 710 – 722.

Winter wheat percent planted (red) versus the 5-year average (green).

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. Weather has been a dominant feature this season with production concerns not only in the U.S., but also Canada, and Australia. While prices have been weak due to low export demand, weather and geopolitical events can change suddenly to move prices higher. If prices move towards 750 – 800, Insider will consider making sales suggestions, while also continuing to watch the downside for any further violations of support. 

  • No new action is currently recommended for 2024 Minneapolis wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for prices, Insider recently recommended buying July ’24 K.C. wheat puts to protect unsold grain if prices continue to retreat further, while war persists in the Black Sea region, and production concerns continue in the southern hemisphere due to El Nino. With the world stocks to use ratio at an 8-year low, there are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 K.C. wheat 660 puts for the liquidity and high correlation to Minneapolis wheat’s price movements, unsold bushels will be protected if prices make new lows, and if prices turn around and rally towards 800, Insider will be looking for opportunities to consider recommending additional sales. 

  • No action is currently recommended for the 2025 Minneapolis wheat crop. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since early September, Dec Minneapolis wheat has been largely rangebound, and the recent breakout to the downside on September 29 has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.

Other Charts / Weather

Brazil average temperature courtesy of the National Weather Service, Climate Prediction Center.

Argentina average temperature courtesy of the National Weather Service, Climate Prediction Center.

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Grain Market Insider: October 10, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Harvest pressure and carryover weakness from the wheat market conspired to pressure the corn market to a lower finish following choppy trade in today’s session.

  • Strong export inspections that were well above expectations supported the front end of the soybean market, that rallied from its lows to finish within 2 cents of the day’s high.

  • Soybean meal also rallied along with the bean market while soybean oil found pressure from the weak biofuel RIN values and lower world veg oil prices.

  • While the wheat complex continues to consolidate, all three classes traded lower on the day, in classic turnaround Tuesday fashion, as the market refocused on lackluster demand, with weak weekly export inspections and year-to-date totals that fall behind last year by 29%.

  • The U.S. Dollar traded lower today as hawkish comments from Federal Reserve officials stated that the recent increase in bond yields may reduce the need for additional rate hikes. Additionally, at the dollar’s peak on October 3, the Bank of Japan sold U.S. Dollars to support the yen. Any further weakness in the dollar will likely help U.S. exports be more competitive in the world market.

  • To see the current U.S. 7-day precipitation forecast, the 8 – 14 day Temperature and Precipitation Outlooks, and South American 1 week precipitation forecasts from the NWS and NOAA, 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. The last couple weeks Dec ’23 corn has seen a bump from a low of 467.75 to a high last week of 499.00. Since mid-August, the psychological 500.00 level has served as market resistance on the front month. Without any bullish catalyst from the coming USDA Supply and Demand report this Thursday, the market remains at risk of sideways to lower price action. In years without bullish fundamental tailwinds at this time of year, the worst case scenarios have seen prices trend slowly lower into anywhere from late November to early January. If you’re new to Insider and were not a subscriber during this summer’s rally, Insider did recommend making sales into that summer rally when Dec ’23 was around 624.00, so for now the thought process is to hold tight on any further sales recommendations until later this fall or early winter, with the objective of seeking out better pricing opportunities. If the market has not turned around by early winter, then Insider may sit tight on the next sales recommendations until next spring. If you end up harvesting more bushels than you can store this fall and must move them, consider re-owning those bushels with either July or September ’24 call options.

  • No new action is recommended for 2024 corn. The Dec ’24 contract has held up better than Dec ’23 as bear spreading over the last several months has brought increased buying interest into Dec ’24 and other further out contract months. Back in late July, the Dec ’23 contract traded up to a 25-cent premium over Dec ’24. Now Dec ’24 holds a 28-cent premium over Dec ’23. This bear spreading has the Dec ’24 price up about 28 cents from its year-to-date low. The risk for 2024 prices is the same as 2023 prices, which is a continuation of a lower trend without a bullish catalyst on this Thursday’s Supply and Demand report. Insider is watching for signs of a change in the current trend to look at recommending buying Dec ’24 call options. This past spring, Insider recommended buying 560 and 610 Dec ’23 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 700.00 or 800.00 that the call options would protect those sold bushels. 

  • No Action is currently recommended for 2025 corn. 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 Insider starts considering the first sales targets.

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Corn futures finished lower on the day as harvest pressure and selling in the wheat market weighed on the corn futures. December corn finished 2 ¾ cents lower but held above the $4.85 initial support level.

  • The USDA will release the next round of crop progress numbers on Tuesday afternoon. Corn harvest is expected to be near 35% complete.

  • Weekly export inspections for last week were released today after the Columbus Day holiday yesterday. Last week, USDA shipped 551,000 MT (21.7 mb) of corn. Total inspections for the 23/24 marketing year are at 128 mb, up 14% from last year. The USDA is forecasting corn exports to be 2.050 bb, a 23% increase over the last marketing year.

  • The weather forecast for the first half of the week looks overall friendly to keep harvest pace moving along. Projected moisture in the 2nd half of the week going into the weekend may slow harvest progress going into next week for north and central areas of the Corn Belt.

  • The market will likely stay choppy this week as the market prepares for the USDA’s WASDE report on Thursday, October 12. Expectations are for corn yield and production to be reduced slightly. Any possible demand adjustments will be the key to determining the carryout projections.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 490 – 516, and support below the market may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. The Nov ’23 contract has been finding buying interest around the June 2023 low of 1256.75 on the front month. Over the last seven trading days, Nov ’23 has traded largely between 1260.00 and 1280.00.  If there were to be a bullish catalyst from this Thursday’s USDA Supply and Demand report and Nov ’23 subsequently closed over 1287.25, that could signal the possibility that a harvest/fall low is in. Bigger picture, since May 2023, the front month contract has traded in a range from 1256.75 on the downside to 1435.00 on the topside. If you are a newer subscriber to Insider and were not with us back in the summer, Insider did make two sales recommendations in the 1310-1360 price window versus Nov ’23. Given those sales recommendations were already made and given that now is not the time of year to be making many if any sales, Insider is content to hold tight on next sales recommendations until later this fall or early winter. The focus for strategy right now is to be on the lookout for any call option buying opportunities. If you end up harvesting more bushels than you can store this fall, consider buying those sold bushels back with July or August ’24 call options.

  • No action is recommended for the 2024 crop. Nov ’24 continues to trade at a discount to Nov ’23. That discount was over 90 cents in late summer yet has stabilized lately around the 10-20 cent range.  Since July, the Nov ’24 contract has largely traded between 1250 and 1320, so this contract is currently testing the bottom end of that range. To date, Insider has not recommended any sales for next year’s soybean crop. First sales targets will probably be early winter at the soonest. Currently, Insider’s focus is also on watching for any opportunities to recommend buying call options.

  • No Action is currently recommended for 2025 Soybeans. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans ended the day higher in the front months after a lower open, while November ‘24 beans closed slightly lower. Soybean meal also ended higher, while soybean oil was lower amid a down day in world veg oils. Solid export inspections were supportive for the soy complex today.

  • Export inspections were the best that have been seen in months. The USDA initially released the inspections number at 1.643 mmt, but that turned out to be a slight error with the real number coming in at 1.036 mmt, still very impressive.

  • Supplies of soybeans in Brazil appear to be tightening, giving the U.S. a good opportunity to export beans. China has been an active buyer out of the PNW for October through December, and barge rates have been coming down, so that may provide more opportunity, though soybeans will need a continued bump in demand to justify a rally.

  • Estimates for Thursday’s WASDE report call for soybean yields to fall slightly to 49.9 bpa from 50.1 bpa in last month’s estimate. Production is expected to be lowered slightly to 4.134 bb. It is unknown if the USDA will make adjustments to demand in this report.

Above: Since the end of August, the soybean market has been in a downtrend, and though it has been consolidating, it remains oversold, which can be supportive if prices turn higher. Initial support to the downside lies near the recent low of 1254, with further support between 1238 – 1214, while resistance above the market lies between 1285 – 1323. 

Wheat

Market Notes: Wheat

  • Wheat reversed yesterday’s trend, finishing today’s session with double-digit losses in Chicago and K.C., despite rising tensions in the Middle East and the Black Sea. Paris milling wheat futures also lost about 2.75 to 3.25 Euros today, suggesting that today’s negativity might not be fundamental in nature. Rather, the funds may have added to short positions, and begun positioning ahead of Thursday’s WASDE report.

  • Fundamentally, global wheat production is setting a bullish backdrop for the marketplace. Growing regions in Australia and Argentina are very dry, and southern Brazil has seen enough rain to cause flooding. Which is also causing concern about their wheat production and quality. With that said, western and central Brazil, along with Argentina, have better chances for good rain in some of the longer range forecasts.

  • Today’s wheat export inspections data initially showed inspections of about 395,000 mt, which was incorrect. A correction was later issued that totaled 265,242 mt, or 9.75 mb.

  • Ag Resource is projecting an Argentine wheat crop of 15.2 mmt, compared to the USDA estimate of 16.5 mmt. And because of the El Nino weather pattern, some analysts are estimating that Australia’s crop could be down by as much as 50%.

  • Although they raised their corn harvest estimate to 12.1 mmt from 11.5 mmt, France kept their soft wheat production estimate unchanged at 35.1 mmt, which compares to last year’s 33.7 mmt.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market in recent weeks has been sensitive to slow export demand, weather, and headlines regarding the Black Sea region.Now with harvest behind us, and new crop planting upon us, markets can still change suddenly due to El Nino and unforeseen geopolitical events, even though export demand remains weak. Following the recent recommendation to make an additional sale for the 2023 crop, Insider will continue to watch for any violations of support while also looking for prices to reach 600 – 650 before suggesting any further sales.

  • No new action is recommended for 2024 Chicago wheat. Considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. There is plenty of time to market the 2024 crop and with the world stocks to use ratio at an 8-year low, many uncertainties remain that could shock prices higher, like geopolitical instability and dryness in the southern hemisphere. If prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 750, if not, and prices make new lows, unsold bushels will be protected by the recommended July ’24 590 puts.

  • No action is currently recommended for 2025 Chicago Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: December wheat has been consolidating since the break on September 29. The market’s previous range of 570 – 618 is an area of resistance which will need more bullish input to rally through. If the market breaks further, support below the market resides between 533 – 524.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C wheat crop. Since the end of May the wheat market has been influenced by weak demand, changing headlines from the Black Sea region, and the corn market with its own demand and weather concerns. With harvest in the bin, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region and the southern hemisphere, which could push prices in either direction. While Insider will continue to monitor the downside for any breach of major support, we would need to see prices pushed toward 700 – 750 before considering any additional sales.

  • No new action is recommended for 2024 K.C. wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian exports continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further, while war persists in the Black Sea region, and production concerns continue in the southern hemisphere due to El Nino. With the world stocks to use ratio at an 8-year low, there are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 660 puts, unsold bushels will be protected if prices make new lows, and Insider will also be looking for opportunities to consider recommending additional sales if prices turn around and rally north of 775. 

  • No action is currently recommended for 2025 KC Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the end of September, K.C. wheat has been consolidating after finding initial support just below the market near 660. If the market resumes its downtrend, the next levels of support below 660 come in around 630 and then 575, while resistance to the upside may be found between 710 – 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. Weather has been a dominant feature this season with production concerns not only in the U.S., but also Canada, and Australia. While prices have been weak due to low export demand, weather and geopolitical events can change suddenly to move prices higher. If prices move towards 750 – 800, Insider will consider making sales suggestions, while also continuing to watch the downside for any further violations of support. 

  • No new action is currently recommended for 2024 Minneapolis wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for prices, Insider recently recommended buying July ’24 K.C. wheat puts to protect unsold grain if prices continue to retreat further, while war persists in the Black Sea region, and production concerns continue in the southern hemisphere due to El Nino. With the world stocks to use ratio at an 8-year low, there are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 K.C. wheat 660 puts for the liquidity and high correlation to Minneapolis wheat’s price movements, unsold bushels will be protected if prices make new lows, and if prices turn around and rally towards 800, Insider will be looking for opportunities to consider recommending additional sales. 

  • No action is currently recommended for the 2025 Minneapolis wheat crop. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since early September, Dec Minneapolis wheat has been largely rangebound, and the recent breakout to the downside on September 29 has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.

Other Charts / Weather

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

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

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Grain Market Insider: October 9, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Carryover strength from higher wheat and crude oil on Mid-East geopolitical concerns, gave way to choppy trade and harvest pressure in the corn market as the day wore on, with December corn closing near the bottom of its range.

  • Choppy trade dominated the soybean market that settled mid-range and lower on the day in the November contract as weakness from sharply lower soybean oil outweighed overnight strength and higher meal prices.

  • Despite sharply higher crude oil prices, soybean oil succumbed to technical selling as the December contract broke to its lowest prices in three months. Today’s weakness not only pressured soybeans but also Board crush margins, which lost 8 ½ cents in the December contracts.

  • In addition to the uncertainty surrounding less-than-ideal growing conditions in the southern hemisphere, rising geopolitical tensions in the Black Sea, and now the Middle East, supported the wheat complex which traded higher through the day after Chicago and K.C. gapped higher on the open Sunday night.

  • Before retreating from its highs in the day session, the U.S. Dollar was jolted higher overnight in a flight to quality trade from the geopolitical uncertainty generated in the Middle East from the Hamas attacks on Israel over the weekend.  In recent weeks, the dollar’s resurgence has added headwinds to U.S. exports by making them more expensive on the world market.

  • To see the current U.S. 3 – 4 week Temperature and Precipitation Outlooks from NOAA, 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. The 2023 growing season has been marked with many challenges that whipsawed the market up and down in a 140-cent range. And while we are at the time of year when lows are often made, the market is still subject to many unforeseen influences that can move prices higher, like in 2020 when the market went on to test contract highs and beyond after hitting market lows before harvest. For now, after locking in gains from previously recommended purchased 580 puts, Insider is content to wait until later in the year (when markets tend to strengthen) before considering suggesting any additional sales. Insider is also monitoring the market for any re-ownership opportunities, should it experience an extended rally.

  • No new action is recommended for 2024 corn. Like the 2023 corn market, prices for the 2024 crop have been dominated by volatility from slow exports and adverse growing conditions which led to a near 80 cent trading range during the summer months. Plenty of time remains to market the crop, and while demand continues to be slow, many uncertainties remain that can move prices higher. After recommending an additional sale for the 2024 crop, Insider may not consider suggesting any further sales until later this winter or possibly even spring. We will continue to monitor the market for any upside opportunities in the coming weeks.  

  • No Action is currently recommended for 2025 corn. 2025 markets are very illiquid right 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. 

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Corn futures were very choppy throughout the day after losing overnight strength, closing 3 ¾ cents lower on the session. Middle East geopolitical tensions and harvest pressure limited any rallies in the corn market today.

  • Geopolitical concerns in the Middle East with the Israeli-Hamas war occurring over the weekend brought a lot of volatility and nervous trade to the marketplace. A strong move higher in crude oil prices supported the grain markets, but that was replaced by a general “risk-off” trade in commodities on the day.

  • Harvest pressure remains a constant in the corn market as harvest ramps up. Due to the Columbus Day holiday, the USDA will not release crop progress pace until Tuesday afternoon. Weather this week looks friendly to keep harvest moving until a rain system moves in towards the end of the week.

  • The corn market lacked any news on the session as the Columbus Day holiday paused Export Inspections report, Crop Progress report, or any potential export sales from over the weekend. Those reports and information will be released tomorrow.

  • The market will likely stay choppy this week as the market prepares for the USDA WASDE report on Thursday, October 12. Expectations are for production to decrease slightly. 

  • Managed money continues to hold a large net short position in the corn market. On Last week’s Commitment of Trader’s report, funds were net short 159,433 contracts of corn.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 490 – 516, and support below the market may be found near 460 and again near 415.

Corn Managed Money Funds net position as of Tuesday, October 3. Net position in Green versus price in Red. Managers net bought 9,173 contracts between September 27 – October 3, bringing their total position to a net short 159,433 contracts.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from changing weather patterns, crop conditions, and export sales. While export demand currently lags last year’s numbers, ending stocks are also currently estimated at a tight 220 million bushels. For now, Insider may not consider suggesting any additional sales until after harvest. Although, we will continue to monitor the market for any upside opportunities in the coming weeks. 

  • No action is recommended for 2024 crop. Grain Market Insider continues to monitor any developments for 2024 soybeans, and while it may be toward year’s end before we will consider recommending any 2024 crop sales, Insider will keep an eye out for any upside opportunities, should the market experience an extended rally.

  • No Action is currently recommended for 2025 Soybeans. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans ended the day slightly lower after opening higher. The weekend news regarding Israel declaring war on Hamas, and Iran reportedly backing the attack, sent crude oil higher and initially brought most commodities higher as well, but they faded throughout the day. Additionally, soybean meal ended higher while soybean oil closed lower.

  • This Thursday, the USDA WASDE report will be released, and early estimates are calling for soybean yields to be lowered slightly to 49.9 bpa from 50.1 bpa in last month’s report. Production is estimated to come in at 4.134 billion bushels, slightly below last month’s USDA estimate.

  • In Brazil, soybean supplies are reportedly getting thin and could open up significant export opportunities for the U.S. for October and November out of the PNW. The U.S. is currently the only offer for that time frame.

  • Brazil’s 23/24 soybean crop is now 10.1% planted, which is up 4.8% from the previous week. Planting is also going more slowly than expected in Brazil, as the Northern and Central regions deal with dryness, and the Southern regions deal with too much moisture.

Above: The soybean market remains in a downtrend and is oversold, which is supportive if prices turn back higher.  Resistance above the market lies between 1285 – 1323. Initial support to the downside lies near 1238 – 1214, with further key support down near 1181.

Soybean Managed Money Funds net position as of Tuesday, October 3. Net position in Green versus price in Red. Money Managers net sold 25,057 contracts between September 27 – October 3, bringing their total position to a net long 5,001 contracts.

Wheat

Market Notes: Wheat

  • The wheat market received a boost today as the trade added more war premium. Along with new Russian attacks on Odessa, over the weekend there was also some uncertainty in the Middle East. Hamas attacked Israel with missiles, and Iran is also said to be involved. Given that wheat is a staple in this region, it sparked a reaction from the market. As an aside, the Hamas attacks also sent crude oil sharply higher due to concern about production out of that part of the world.

  • Globally there are growing concerns for multiple wheat producers. Western Australia is facing drought, and in Argentina, some analysts are projecting a wheat crop of 15 mmt or less; the USDA is estimating 16.5 mmt currently. Because of this, it is being said that Argentina’s farmers are selling wheat at the slowest pace in seven years.

  • In the face of danger from Russia, 12 ships are said to be waiting to enter Ukraine’s humanitarian corridor to transport grain. Although, Russia remains the dominant wheat exporter, with IKAR estimating their exports at 64.5 mmt of grain, compared with 64.0 mmt previously. In addition, they also increased their estimate of Russian grain production by 1.2 mmt to 141.2 mmt.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market in recent weeks has been sensitive to slow export demand, weather, and headlines regarding the Black Sea region. Now with harvest behind us, and new crop planting upon us, markets can still change suddenly due to El Nino and unforeseen geopolitical events, even though export demand remains weak. Following the recent recommendation to make an additional sale for the 2023 crop, Insider will continue to watch for any violations of support while also looking for prices to reach 650 – 700 before suggesting any further sales.

  • No new action is recommended for 2024 Chicago wheat. Considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. Plenty of time remains to market the 2024 crop with many uncertainties that could shock prices higher, like the world stocks to use ratio at an 8-year low, war in the Black Sea and production concerns in the southern hemisphere. If prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800, if not, and prices make new lows, unsold bushels will be protected by the recommended July ’24 590 puts.

  • No action is currently recommended for 2025 Chicago Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Following the September 29 Grain Stocks report, the December contract broke out of its previous range to the downside and has since rallied back. That previous range of 570 – 618 is an area of resistance which the market will need more bullish input to rally through.  If it cannot, support below the market resides between 533 – 524.

Chicago Wheat Managed Money Funds net position as of Tuesday, October 3. Net position in Green versus price in Red. Money Managers net sold 2,404 contracts between September 27 – October 3, bringing their total position to a net short 98,788 contracts.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C wheat crop. Since the end of May, the wheat market has been influenced by weak demand, changing headlines from the Black Sea region, and the corn market with its own demand and weather concerns. With harvest in the bin, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region and the southern hemisphere, which could push prices in either direction. While Insider will continue to monitor the downside for any breach of major support, we would need to see prices pushed toward 750 – 800 before considering any additional sales.

  • No new action is recommended for 2024 K.C. wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices. Insider recently recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 660 puts, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.

  • No action is currently recommended for 2025 KC Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the beginning of September, the market has drifted sideways to lower. The recent breakout to the downside has Dec. K.C. wheat looking toward 630 and 575 for the next levels of support, while nearby resistance on the upside rests between 710 – 722.

K.C. Wheat Managed Money Funds net position as of Tuesday, October 3. Net position in Green versus price in Red. Money Managers net sold 4,055 contracts between September 27 – October 3, bringing their total position to a net short 23,827 contracts.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. Weather has been a dominant feature this season with production concerns not only in the U.S., but also Canada and Australia. While prices have been weak due to low export demand, weather and geopolitical events can change suddenly to move prices higher. If prices begin to improve, Insider will consider making sales suggestions, while also continuing to watch the downside for any further violations of support. 

  • No new action is currently recommended for 2024 Minneapolis wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for prices. Insider recently recommended buying July ’24 K.C. wheat puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 K.C. wheat 660 puts for the liquidity and high correlation to Minneapolis wheat’s price movements, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since early September, Dec Minneapolis wheat has been largely rangebound, and the recent breakout to the downside on September 29 has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.

Minneapolis Wheat Managed Money Funds net position as of Tuesday, October 3. Net position in Green versus price in Red. Money Managers net sold 5,329 contracts between September 27 – October 3, bringing their total position to a net short 20,986 contracts. 

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

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Grain Market Insider: October 6, 2023

ByGrain Market Insider

All prices as of 2:00 pm Central Time

Grain Market Highlights

  • Following the highest close in over a month, the corn market experienced choppy trade throughout the day. While overbought conditions added to the pressure from the financial markets, December corn remains above the 50-day moving average.

  • Despite overnight strength on follow through buying from yesterday’s gains, the soybean market chopped lower through the day, along with soybean meal, on the threat of higher borrowing costs and stronger headwinds in the export market from the higher dollar.  Soybean oil, being more oversold and less influenced by export business, maintained a positive close, but well off the day’s highs.

  • While concerns regarding escalation of the Ukraine war continue to reverberate through the wheat market, the shock to the U.S. dollar and reports of higher Ukrainian wheat production helped pressure all three wheat classes as they gave up half of Thursday’s gains.

  • The U.S. dollar and interest rates traded sharply higher following today’s monthly unemployment and September payroll figures. Unemployment was steady, while payroll numbers were about double expectations. The initial reactions weighed heavily on the grain markets at the 8:30 open. Although the financial markets relaxed through the day, the grain markets remained under pressure.

  • To see the current 5 day Precipitation forecast, 6 – 10 day, and 8–14-day Temperature and Precipitation Outlooks from NOAA, 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. The 2023 growing season has been marked with many challenges that whipsawed the market up and down in a 140-cent range. And while we are at the time of year when lows are often made, the market is still subject to many unforeseen influences that can move prices higher, like in 2020 when the market went on to test contract highs and beyond after hitting market lows before harvest. For now, after locking in gains from previously recommended purchased 580 puts, Insider is content to wait until later in the year (when markets tend to strengthen) before considering suggesting any additional sales. Insider is also monitoring the market for any re-ownership opportunities, should it experience an extended rally.

  • No new action is recommended for 2024 corn. Like the 2023 corn market, prices for the 2024 crop have been dominated by volatility from slow exports and adverse growing conditions which led to a near 80 cent trading range during the summer months. Plenty of time remains to market the crop, and while demand continues to be slow, many uncertainties remain that can move prices higher. After recommending an additional sale for the 2024 crop, Insider may not consider suggesting any further sales until later this winter or possibly even spring. We will continue to monitor the market for any upside opportunities in the coming weeks.  

  • No Action is currently recommended for 2025 corn. 2025 markets are very illiquid right 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. 

Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Grain markets traded lower on the session, pressuring corn futures to 4-5 cent losses as prices pulled back from the $5.00 a bushel resistance level. December corn lost 5 ½ cents on the day, but remained 15 ¼ cents higher on the week, posting its highest weekly close since August.

  • Grain markets were pressured by a surge higher in the U.S. dollar and interest rates after the September Jobs report was released, showing better job growth than expected. This could possibly lead to longer-term interest rate hikes and tighter monetary policy.

  • U.S. harvest was 23% complete last week, and the pace should reflect strong progress this week. The forecast still looks friendly overall to keep harvest moving along at a good pace. Harvest pressure will limit the corn market as fresh supplies pressure basis and the cash market. The National Corn Index is trading nearly 23 cents under the December futures price.

  • The recent drop in crude oil and gasoline prices have tightened ethanol margins. Ethanol production started out the marketing year relatively strong, but a tighter margin could slow that pace.

  • The corn market rally may still be limited, as premiums for Brazilian corn have slipped recently, still keeping Brazilian corn cheaper than U.S. bushels on the export market. As planting is beginning for this year’s South American corn, some weather issues may pose more challenging conditions in portions of Argentina and Brazil, which could limit production.

Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 490 – 516, and support below the market may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No new action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from changing weather patterns, crop conditions, and export sales. While export demand currently lags last year’s numbers, ending stocks are also currently estimated at a tight 220 million bushels. For now, Insider may not consider suggesting any additional sales until after harvest. Although, we will continue to monitor the market for any upside opportunities in the coming weeks. 

  • No action is recommended for 2024 crop. Grain Market Insider continues to monitor any developments for 2024 soybeans, and while it may be toward year’s end before we will consider recommending any 2024 crop sales, Insider will keep an eye out for any upside opportunities, should the market experience an extended rally.

  • No Action is currently recommended for 2025 Soybeans. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put

  • Soybeans opened the day higher, but ended with a lower close following the Jobs report this morning, which saw higher employment growth than expected and sparked concerns that the Federal Reserve would keep interest rates higher for a longer period. Soybean meal ended lower and soybean oil was higher.

  • For the week, November soybeans lost 9 cents, December meal lost 9.10 dollars, and December soybean oil lost 0.48 cents. As soy products fall, crush margins have fallen as well and given up some incentive for soybean processors to crush beans in large numbers.

  • Prices found support yesterday after the export sales report showed better numbers than expected, and soybean meal exports were reportedly up 32% from a year ago, with limited Argentinian supplies following their drought. Argentina remains in drought conditions, which will be something to pay attention to as they begin planting.

  • The northern region of Brazil is currently too dry, but in the South, it is far too wet to plant with floods occurring and 4 to 9 inches of rain forecast over the next 10 days. With U.S. ending stocks slated to be tight, any weather impact on Brazil’s soybean crop could be friendly for prices.

Above: The soybean market remains in a downtrend and is oversold, which is supportive if prices turn back higher.  Resistance above the market lies between 1285 – 1323. Initial support to the downside lies near 1238 – 1214, with further key support down near 1181.

Wheat

Market Notes: Wheat

  • The Labor Department’s report indicated that 336,000 jobs were added in the month of September, which exceeded expectations and caused an increase in the U.S. Dollar Index. That may have opened the floodgates for lower wheat, even though the index was actually negative on the day at the grain market close.

  • More details have emerged about yesterday’s reports of a ship hitting a Russian mine. Reportedly, it was a Turkish cargo ship called the Kafkametler that struck a mine in the Black Sea. Damage was minor and the crew was safe. The location of the mine was near Romania, and according to one Ukrainian official, it may have been there from last year (not a new mine placed by Russia). However, there are concerns that Russia could plant their own mines to target cargo ships.

  • Ukraine’s grain harvest as of October 6th is 22% above last year, at 32.3 mmt of grain collected. Of that total, 22.2 mmt is wheat which represents a 16% year on year increase.

  • Australia had the driest September on record with at, or near, record temperatures across the country. Their wheat crop production is likely to suffer greatly, especially because the El Nino pattern is expected to keep them warm and dry.

  • Wheat is also struggling in Argentina. According to the Buenos Aires Grain Exchange, 33% of their wheat crop is poor to very poor, up from 27% last week. Some southern areas did receive rain that is certainly welcomed, but more widespread coverage will be needed.

Chicago Wheat Action Plan Summary

  • No new action is currently recommended for 2023 Chicago wheat. The wheat market in recent weeks has been sensitive to slow export demand, weather, and headlines regarding the Black Sea region. Now with harvest behind us, and new crop planting upon us, markets can still change suddenly due to El Nino and unforeseen geopolitical events, even though export demand remains weak. Following the recent recommendation to make an additional sale for the 2023 crop, Insider will continue to watch for any violations of support while also looking for prices to reach 650 – 700 before suggesting any further sales.

  • No new action is recommended for 2024 Chicago wheat. Considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. Plenty of time remains to market the 2024 crop with many uncertainties that could shock prices higher, like the world stocks to use ratio at an 8-year low, war in the Black Sea and production concerns in the southern hemisphere. If prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800, if not, and prices make new lows, unsold bushels will be protected by the recommended July ’24 590 puts.

  • No action is currently recommended for 2025 Chicago Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Following the September 29 Grain Stocks report, the December contract broke out of its previous range to the downside and has since rallied back. That previous range of 570 – 618 is an area of resistance which the market will need more bullish input to rally through.  If it cannot, support below the market resides between 533 – 524.

KC Wheat Action Plan Summary

  • No new action is recommended for 2023 K.C wheat crop. Since the end of May, the wheat market has been influenced by weak demand, changing headlines from the Black Sea region, and the corn market with its own demand and weather concerns. With harvest in the bin, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region and the southern hemisphere, which could push prices in either direction. While Insider will continue to monitor the downside for any breach of major support, we would need to see prices pushed toward 750 – 800 before considering any additional sales.

  • No new action is recommended for 2024 K.C. wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices. Insider recently recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 660 puts, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.

  • No action is currently recommended for 2025 KC Wheat. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since the beginning of September, the market has drifted sideways to lower. The recent breakout to the downside has Dec. K.C. wheat looking toward 630 and 575 for the next levels of support, while nearby resistance on the upside rests between 710 – 722.

Mpls Wheat Action Plan Summary

  • No new action is currently recommended for the 2023 New Crop. Weather has been a dominant feature this season with production concerns not only in the U.S., but also Canada and Australia. While prices have been weak due to low export demand, weather and geopolitical events can change suddenly to move prices higher. If prices begin to improve, Insider will consider making sales suggestions, while also continuing to watch the downside for any further violations of support. 

  • No new action is currently recommended for 2024 Minneapolis wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for prices. Insider recently recommended buying July ’24 K.C. wheat puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 K.C. wheat 660 puts for the liquidity and high correlation to Minneapolis wheat’s price movements, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.

  • No action is currently recommended for the 2025 Minneapolis wheat crop. 2025 markets are very illiquid right 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.

Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put

Above: Since early September, Dec Minneapolis wheat has been largely rangebound, and the recent breakout to the downside on September 29 has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.

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