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Grain Market Insider: September 7, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • In a relatively quiet session corn held onto fractional gains as the market waited in anticipation of next week’s USDA supply and demand update.

  • Soybeans traded lower erasing gains from yesterday as prices gravitated toward the middle of the recent trading range.

  • Soybean meal and oil both traded lower with December soybean oil futures shedding over 2.5% following weakness in crude and palm oil.

  • All three wheat classes ended lower as traders squared positions ahead of next week’s USDA WASDE report.

  • To see the current U.S. Drought Monitor and the U.S. Corn Areas in Drought as of September 5th map, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • Grain Market Insider sees an active opportunity to sell the remaining, previously recommended, DEC ‘23 580 puts to lock in gains. At the end of June, Insider recommended buying DEC ’23 580 puts for approximately 30 cents in premium plus fees and commission. At the time, the U.S. Drought Monitor was showing dryness across the Midwest and weather forecasts were calling for hot and dry conditions. Since then, conditions have improved and DEC ’23 corn has dropped over 100 cents with the recommended 580 puts gaining over 200% in value. With much of the growing season behind us, we are at the time of year when market lows are often made, and while the market may continue to recede into harvest, it is still subject to unforeseen weather like the 2020 derecho, or headlines from the Black Sea that could shock prices higher.

  • Grain Market Insider sees an active opportunity to sell a portion of your 2024 corn crop today. The 2023 growing season has been marked by hot and dry conditions, changing weather forecasts, and geopolitical volatility that has moved prices dramatically in both directions for both the 2023 and 2024 crops. We recognize that $5 is not the $6 or $7 that we have seen in recent memory, but much like the runup in 2012, some of the best prices for the 2013 crop were made in the summer of 2012 before they retreated that fall and into the next calendar year. Now that the 2023 growing season is winding down, 2024 prices continue to be historically favorable to get another early sale on the books, and Grain Market Insider suggests selling another portion of your 2024 production on a DEC 24 HTA contract, or DEC 24 Futures contract, so basis can be set at a later more advantageous time.  

  • 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. 

  • It was a very quiet session in the corn market on Thursday as prices traded on both sides of a narrow trading range to close just fractionally higher in the Dec corn futures. The market is looking for news and squaring positions going into next week’s USDA report on Tuesday.

  • Next week’s USDA report will be looking at crop production and likely making demand adjustments. Expectations are for yield to be lowered to 173.5 bushels/acre from 175.1 last month. The movement of demand may be the key to prices as reduced demand will likely keep the carryout projection for the marketing year relatively large, limiting price rallies. The market is concerned about a possible acre adjustment that could also increase the potential corn supply.

  • The USDA will release the last export sales report for the 2022-23 marketing year on Friday morning. The expectations for corn or old crop sales of  -200,000 to 100,000 MT and new crop sales of 400,000 to 1,000,000 MMT. Export demand remains lackluster and has limited price.

  • Corn prices have been trading in a sideways, consolidative pattern since mid-August. The narrowing, choppy pattern may be setting the market up for a break in either direction, likely triggered by the reaction to the report on Tuesday next week.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No 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 sales have improved, growing conditions have continued to be variable and questions remain regarding what final yields will be, keeping prices supported. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day lower, erasing all gains made yesterday as trade remains rangebound. Soybean oil was down over 2.5% in the December contract with soybean meal lower but not by as much. Soybean oil has been pressured by lower palm oil.

  • Analysts are anticipating yields between 49 and 50 bpa, but the planting estimate of just 83.5 million acres could lead to an even tighter carryout unless the USDA finds more soybean acres on Tuesday.

  • Soybean export demand has remained active with another sale yesterday announced of 9.2 mb to unknown destinations. This brings new crop total sales to 526 mb, which is decent but still 370 mb lower than a year ago.

  • Soybeans on the Dalian exchange are trading at the equivalent of $18.80 a bushel, which is near the yearly highs and has spurred imports. China’s soybean imports for August were seen rising to 9.36 mmt which is up 31% from a year ago.

Above: After filling in the chart gap that was left between 1390-1/2 and 1394-3/4, the market has drifted lower in conjunction with stochastic indicators crossing over in overbought conditions indicating a possible downward market reversal. For now, if prices continue to slide lower, the market may find support near 1330 and again around 1300. If prices regain upward momentum, initial resistance will be in the 1400 – 1410 area.

Wheat

Market Notes: Wheat

  • All three wheat classes ended the day lower, as traders began consolidating positions and taking profits from Wednesday’s gains ahead of Tuesday’s USDA September WASDE update.

  • Adding to the negative tone to the wheat markets, Matif wheat futures were lower again on slow EU and U.S. exports record setting Russian export pace. Although, the U.S. recently sold South Korea 88k mt of milling wheat for their flour mills for November/December shipment.

  • Russia continued its drone attacks on both the Black Sea and Danube River ports, damaging port and grain facility infrastructure, and injuring one person. This recent attack was the fourth such strike in five days.

  • Not many changes are expected in Tuesday’s WASDE update. The average trade guess for U.S. carryout is 614 mb, down 1 mb from last month, and the average guess for 23/24 world carryout is 265 mmt, 600k lower than last month.

  • Statistics Canada is also expected to release its July-23 stocks estimate tomorrow, with all wheat stocks expected to be near 4 mmt, up from last year’s 3.663 mmt.

  • While some of Wednesday’s strength could be attributed to the market adding war premium, concerns regarding dry conditions contributing to smaller Australian and Argentinian crops and too much rain affecting the quality of Brazil’s wheat also likely contributed.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • No 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 825, 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.

Above: The Chicago wheat market continues to be rangebound with initial support at the low end coming in near 590 – 595, with resistance at the upper end near 650. If the market breaks out to the upside, the next level of resistance may be found near 665; if not and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December K.C. wheat posted a bullish reversal on September 5 from oversold conditions and followed through into the previous trading range. If prices continue higher, resistance above the market remains near 772 – 780. Otherwise, support below the market rests near the September 5 low of 724-1/2, and again near the September ’21 low of 670.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: On September 5, the December contract posted a bullish reversal from oversold conditions with some follow-through. If prices continue to the upside, nearby resistance could be found near 785 – 795 and again around 810 – 820. Otherwise, the next support level below the market is near the Sept. 5 low of 756-3/4, and then near the June ’21 low of 730.

Other Charts / Weather

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Grain Market Insider: September 6, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Despite the USDA’s 3% drop in corn crop’s good/excellent crop rating to the lowest level since 2012, the corn market rallied into resistance near the 20-day moving average and faded lower into the close.

  • A 5% drop in good/excellent crop ratings fueled the soybean market to finish higher on the day, though intraday profit taking and weakness from the corn market likely weighed on prices that closed just below last night’s open.

  • Soybean meal ended the day higher with carryover strength from soybeans, while soybean oil traded lower on profit taking and lower palm oil.

  • Technical buying and the addition of war premium with renewed attacks on Danube River facilities and Kyiv sent the wheat market higher throughout the day, with K.C. contracts leading the way.

  • To see the current U.S. 7-day precipitation forecast and the 8 – 14 day Temperature and Precipitation Outlooks courtesy of the NWS and NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • Grain Market Insider sees an active opportunity to sell the remaining, previously recommended, DEC ‘23 580 puts to lock in gains. At the end of June, Insider recommended buying DEC ’23 580 puts for approximately 30 cents in premium plus fees and commission. At the time, the U.S. Drought Monitor was showing dryness across the Midwest and weather forecasts were calling for hot and dry conditions. Since then, conditions have improved and DEC ’23 corn has dropped over 100 cents with the recommended 580 puts gaining over 200% in value. With much of the growing season behind us, we are at the time of year when market lows are often made, and while the market may continue to recede into harvest, it is still subject to unforeseen weather like the 2020 derecho, or headlines from the Black Sea that could shock prices higher.

  • Grain Market Insider sees an active opportunity to sell a portion of your 2024 corn crop today. The 2023 growing season has been marked by hot and dry conditions, changing weather forecasts, and geopolitical volatility that has moved prices dramatically in both directions for both the 2023 and 2024 crops. We recognize that $5 is not the $6 or $7 that we have seen in recent memory, but much like the runup in 2012, some of the best prices for the 2013 crop were made in the summer of 2012 before they retreated that fall and into the next calendar year. Now that the 2023 growing season is winding down, 2024 prices continue to be historically favorable to get another early sale on the books, and Grain Market Insider suggests selling another portion of your 2024 production on a DEC 24 HTA contract, or DEC 24 Futures contract, so basis can be set at a later more advantageous time.  

  • 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. 

  • Despite strength in other grain markets and reduced crop ratings, corn futures faded off session highs, with December corn finishing ¼ cent lower on the session.

  • Front-end futures are still supported by the lack of deliveries versus the September contract, reflecting a tight overall corn supply.

  • Price action was relatively neutral on the session as corn prices consolidated at the top of yesterday’s strength. The lack of follow-through given slightly more bullish news and strength in other grains was disappointing overall.

  • USDA crop ratings saw the corn crop drop to 53% good/excellent, down 3% from last week.  Key states of Illinois and South Dakota lost 10% week over week. At 53% good/excellent, this is the lowest rating for U.S. corn crop since 2012, which was significantly lower at 22% good/excellent. Warm weather has pushed maturity with 18% of the crop now mature, 2% above 5-year average.

  • Brazil corn harvest continues to pressure the market. AgRural estimates Brazil’s 2nd crop harvest has reached 88% as of August 31st, vs. 98% last year. They also estimate the 1st season crop for 23/24 is 13% planted, vs. 9% last year.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support 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).

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day higher along with soybean meal, while soybean oil closed lower. Yesterday’s crop ratings were bullish for soybean prices, but the recent decline in Malaysian palm oil has put pressure on soybean oil.

  • Yesterday’s crop ratings showed the good to excellent rating for soybeans falling sharply by 5% to 53%. The poor to very poor rating also increased by 3% to 17%. These are the worst ratings since 2012.

  • Palm oil futures fell for the third consecutive day which pressured soybean oil, but India is set to import 10 mmt of palm oil which is a 26% increase from last year, and global palm oil production is expected to fall by 10% due to poor production.

  • The Argentinian government has once again introduced a “soybean dollar” program to incentivize producer selling. This program is a new version which allows exporters to keep 25% of the foreign currency received from their sales abroad instead of having to fully sell it in the official exchange market.

Above: After filling in the chart gap that was left between 1390-1/2 and 1394-3/4, the market has drifted lower in conjunction with stochastic indicators crossing over in overbought conditions indicating a possible downward market reversal. For now, if prices continue to slide lower, the market may find support near 1330 and again around 1300. If prices regain upward momentum, initial resistance will be in the 1400 – 1410 area.

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

Wheat

Market Notes: Wheat

  • The addition of war premium on oversold conditions likely led to the market’s strength, as all three classes of wheat closed higher on the day with follow-through buying from Tuesday’s bullish reversals.

  • There were renewed drone attacks on Kyiv and Ukraine’s Ag facilities in the Danube River port of Ismail that damaged grain elevators and killed one worker. Additionally, according to Romania’s President, one of the attacks came within a half mile of their border with Ukraine, and with Romania being a NATO member, the risk of escalation is heightened.

  • SovEcon raised its 23/24 estimate for Russia’s wheat exports to a record 48.6 mmt, up from 48.1 mmt. The agency cited “increases in production, high export pace, and record-breaking sales early in the season,” for its reasoning. The high export numbers further show Russia’s recent dominance of the world wheat export market.

  • As for the southern Hemisphere, Conab revised its estimate of Brazil’s wheat crop to 10.2 mmt, down 0.2 mmt from its last report. The revised estimate is in line with the USDA’s most recent forecast of 10.3 mmt.

  • The USDA reported that Spring wheat harvest is 74% complete as of Sunday, September 3, 3% behind the average for this date, but a 20% jump from last week. Winter wheat planting has also begun, with the crop estimated to be 1% planted versus 3% on average.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • Grain Market Insider sees an active opportunity to buy July ’24 590 Chicago Wheat Puts on a portion of your 2024 SRW Wheat crop. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July Chicago wheat broke through a major support area around 657. Closing below 657 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the May low of 573. If the 573 level fails, the next support could be the 468 – 514 level. Buying July ’24 590 Chicago wheat puts on a portion of our SRW production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  •  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.

Above: The Chicago wheat market continues to be rangebound with initial support at the low end coming in near 590 – 595, with resistance at the upper end near 650. If the market breaks out to the upside, the next level of resistance may be found near 665; if not and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December K.C. wheat posted a bullish reversal on September 5 from oversold conditions and followed through into the previous trading range. If prices continue higher, resistance above the market remains near 772 – 780. Otherwise, support below the market rests near the September 5 low of 724-1/2, and again near the September ’21 low of 670.

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

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: On September 5, the December contract posted a bullish reversal from oversold conditions with some follow-through. If prices continue to the upside, nearby resistance could be found near 785 – 795 and again around 810 – 820. Otherwise, the next support level below the market is near the Sept. 5 low of 756-3/4, and then near the June ’21 low of 730.

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

Other Charts / Weather

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Grain Market Insider: September 5, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • A potential quickening of the corn crop’s maturity due to the recent hot and dry weather helped support corn prices today as traders anticipate lower crop condition ratings.

  • Weaker soybean oil and meal likely added to the negativity in the soybean complex that was unable to end the day on the positive side, despite another 251k metric ton flash sale of soybeans to unknown destinations.

  • Even though crude oil rallied over 1%, soybean oil likely followed palm oil lower on increasing Malaysian stocks that are now reportedly at a six-month high.

  • Despite mediocre export inspections, additional attacks on Danube River ports and a shrinking Australian wheat crop lent support to the wheat market where all three wheat classes settled mostly higher except the deferred K.C. contracts which closed lower on the day.

  • Disappointing economic data from Europe and Asia lent support to the U.S. dollar today which reached a 6-month high, and likely added some resistance to commodities.

  • To see the current U.S. 6 – 10 day and the 8 – 14 day Temperature and Precipitation Outlooks courtesy of the NWS and NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • Grain Market Insider sees an active opportunity to sell the remaining, previously recommended, DEC ‘23 580 puts to lock in gains. At the end of June, Insider recommended buying DEC ’23 580 puts for approximately 30 cents in premium plus fees and commission. At the time, the U.S. Drought Monitor was showing dryness across the Midwest and weather forecasts were calling for hot and dry conditions. Since then, conditions have improved and DEC ’23 corn has dropped over 100 cents with the recommended 580 puts gaining over 200% in value. With much of the growing season behind us, we are at the time of year when market lows are often made, and while the market may continue to recede into harvest, it is still subject to unforeseen weather like the 2020 derecho, or headlines from the Black Sea that could shock prices higher.

  • Grain Market Insider sees an active opportunity to sell a portion of your 2024 corn crop today. The 2023 growing season has been marked by hot and dry conditions, changing weather forecasts, and geopolitical volatility that has moved prices dramatically in both directions for both the 2023 and 2024 crops. We recognize that $5 is not the $6 or $7 that we have seen in recent memory, but much like the runup in 2012, some of the best prices for the 2013 crop were made in the summer of 2012 before they retreated that fall and into the next calendar year. Now that the 2023 growing season is winding down, 2024 prices continue to be historically favorable to get another early sale on the books, and Grain Market Insider suggests selling another portion of your 2024 production on a DEC 24 HTA contract, or DEC 24 Futures contract, so basis can be set at a later more advantageous time.  

  • 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. 

  • Corn prices pushed higher with December closing up 4 ½ cents on the session. The talk of hot weather pushing the crop to maturity and possibly limiting final production, along with technical buying and short covering helped support the market.

  • Excessive heat across the middle of the country over the weekend likely pushed the crop close to maturity and limited any additional potential the corn crop could have in most areas. The temperature looks to moderate later in the week with improved rain chances in the northern plains.

  • Weekly crop ratings are likely to reflect the impact of high temperature across the Midwest this past weekend. The percentage of Good/Excellent is expected to drop to 54%, down 2% from last week. Crop maturity may be a bigger focus, which last week saw 9% of the corn crop classified as mature, up 5% on the week and 1% over the 5-year average of 8%.

  • Grain markets are becoming concerned about the water levels on the Mississippi River for the fall harvest window. Barge restrictions have been put in place, limiting grain movement, and will have the potential to impact cash basis levels going into the fall months. This may be more tied to the pressure in the soybean markets but is likely limiting buying strength in corn.

  • The last weekly export inspection report for the marketing year saw 481,000 MT of shipments last week. This is still down 32% year over year with the new marketing year beginning on September 1.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Money Corn Managed Money Funds net position as of Tuesday, Aug. 29. Net position in Green versus price in Red. Managers net bought 18,787  contracts between Aug. 22 – 29, bringing their total position to a net short 87,348 contracts.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day mostly lower along with both soybean meal and oil despite the hot and dry weather, decent export sales, and the possibility of deteriorating yields. The U.S. Dollar hit a 6-month high today which may have pressured the soy complex.

  • Although it did not provide any support today, crude oil rallied sharply which could be beneficial to soybean oil down the road. The rally came after Saudi Arabia said that it would extend its voluntary cut of 1 million barrels per day until the end of the year.

  • There was a sale reported this morning of 251,000 metric tons of soybeans for delivery to unknown destinations for the 23/24 marketing year, and export inspections totaled 13.9 mb for the week ending Thursday, August 31 which was a bit light.

  • July soybean crush was reported to be a new record for July at 184.8 million bushels which was up 2% from July last year. Crush margins have been very profitable and have incentivized processors. Malaysian palm oil was down 2.13% today which likely pressured soybean oil.

Above: After filling in the chart gap that was left between 1390-1/2 and 1394-3/4, the market has drifted lower in conjunction with stochastic indicators crossing over in overbought conditions indicating a possible downward market reversal. For now, if prices continue to slide lower, the market may find support near 1330 and again around 1300. If prices regain upward momentum, initial resistance will be in the 1400 – 1410 area.

Soybeans Managed Money Funds net position as of Tuesday, Aug. 29. Net position in Green versus price in Red. Money Managers net bought 32,779 contracts between Aug. 22 – 29, bringing their total position to a net long 90,985 contracts.

Wheat

Market Notes: Wheat

  • For the week ending August 31, the USDA reported that 300,000 mt of wheat were inspected for export, toward the low end of expectations and versus 390,000 inspected the week prior, and down 24% from last year versus the USDA’s forecast of down only 8%.

  • In Friday’s Commitment of Traders report, Managed Money sold nearly 9k contracts of Chicago wheat, bringing their short position to just under 80,000 contracts.

  • Monday’s talks between Russia and Turkey ended without reviving a Black Sea export corridor deal. Putin stated that he wasn’t interested in renewing a deal unless obstacles to Russian ag exports were removed. Additionally, Russia would like to reopen an ammonia pipeline and be admitted back into the SWIFT banking system.

  • Prior to Russia’s and Turkey’s talks, Russia attacked another Ukrainian port on the Danube River, and despite the attacks, Ukraine is looking to boost its exports via the river. To that end, the Ukrainian grain industry is lobbying Ukraine and Romania to add anchorage points in the Danube off the coasts of both countries.

  • According to ABARE, the Australian government shaved 3% off its June estimate of the Australian wheat crop to 25.4 mmt, representing a 36% decline from last year’s record crop and 4.6 mmt below the USDA’s current 29 mmt estimate. The decline in production may have China, who is a major importer of Australian wheat, looking for other sources for its supply needs.

  • The Rosario Grains Exchange stated that Argentina recently received between 1.18 and 3.94 inches of rain in some key growing areas and may have been enough to relieve the wheat crop that has been struggling with dry conditions.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • Grain Market Insider sees an active opportunity to buy July ’24 590 Chicago Wheat Puts on a portion of your 2024 SRW Wheat crop. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July Chicago wheat broke through a major support area around 657. Closing below 657 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the May low of 573. If the 573 level fails, the next support could be the 468 – 514 level. Buying July ’24 590 Chicago wheat puts on a portion of our SRW production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

Chicago Wheat Managed Money Funds net position as of Tuesday, Aug. 29. Net position in Green versus price in Red. Money Managers net sold 8,960 contracts between Aug. 22 – 29, bringing their total position to a net short 79,881 contracts.

KC Wheat Action Plan Summary

Above: December KC wheat broke through the bottom end of its trading range and may be poised to test the September ’21 low of 670 unless bullish input enters the market to turn prices higher. If so, initial resistance above the market may rest near 772 – 780.

K.C. Wheat Managed Money Funds net position as of Tuesday, Aug. 22. Net position in Green versus price in Red. Money Managers net sold 6,552 contracts between Aug. 15 – 22, bringing their total position to a net short 5,965 contracts.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: The December contract resumed its downward slide and traded through the May low of 769, and is now showing signs of being oversold, which can be supportive if prices turn higher. If prices do turn higher, nearby resistance could be found near 785 – 795 and again around 810 – 820. Otherwise, the next support level below the market could come in near the June ’21 low of 730.

Minneapolis Wheat Managed Money Funds net position as of Tuesday, Aug. 22. Net position in Green versus price in Red. Money Managers net sold 4,723 contracts between Aug. 15 – 22, bringing their total position to a net short 6,234 contracts.

Other Charts / Weather

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Grain Market Insider: September 1, 2023

ByGrain Market Insider
The CME and Total Farm Marketing offices will be closed
Monday, September 4, in observance of Labor Day

 

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • A quiet news day and a 3-day weekend ahead kept many traders on the sidelines. Others covered short positions, as December corn consolidated within yesterday’s trading range to close only moderately higher on the day.

  • Another flash sale of soybeans to unknown destinations, the fifth in a row, and rallies in both crude and palm oil lent support to the soybean and soybean oil markets, although weaker meal added resistance to soybeans which settled only slightly higher after giving up overnight gains.

  • After trading on the positive side of unchanged, all three wheat classes fell victim to continued short selling on weak export demand and the possibility of a new Black Sea grain deal, as traders hedge long positions in other grains with wheat.

  • Following through from yesterday’s turnaround on ideas that the U.S. economy is faring better than its European counterparts, the U.S. dollar continued its rally in today’s session overtaking losses from earlier this week. The rally in the dollar may be creating headwinds for U.S. exports, like wheat, which become more expensive in the world market as the dollar rises in value.

  • To see the current U.S. 7 day Total Precipitation Forecast and the 8 – 14 day Temperature and Precipitation Outlooks courtesy of the NWS and NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • Grain Market Insider sees an active opportunity to sell the remaining, previously recommended, DEC ‘23 580 puts to lock in gains. At the end of June, Insider recommended buying DEC ’23 580 puts for approximately 30 cents in premium plus fees and commission. At the time, the U.S. Drought Monitor was showing dryness across the Midwest and weather forecasts were calling for hot and dry conditions. Since then, conditions have improved and DEC ’23 corn has dropped over 100 cents with the recommended 580 puts gaining over 200% in value. With much of the growing season behind us, we are at the time of year when market lows are often made, and while the market may continue to recede into harvest, it is still subject to unforeseen weather like the 2020 derecho, or headlines from the Black Sea that could shock prices higher.

  • Grain Market Insider sees an active opportunity to sell a portion of your 2024 corn crop today. The 2023 growing season has been marked by hot and dry conditions, changing weather forecasts, and geopolitical volatility that has moved prices dramatically in both directions for both the 2023 and 2024 crops. We recognize that $5 is not the $6 or $7 that we have seen in recent memory, but much like the runup in 2012, some of the best prices for the 2013 crop were made in the summer of 2012 before they retreated that fall and into the next calendar year. Now that the 2023 growing season is winding down, 2024 prices continue to be historically favorable to get another early sale on the books, and Grain Market Insider suggests selling another portion of your 2024 production on a DEC 24 HTA contract, or DEC 24 Futures contract, so basis can be set at a later more advantageous time.  

  • 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. 

  • Corn prices consolidated, trading within Thursday’s trading range as the market squared positions for the 3-day weekend, waiting for new news. Dec corn gained 3-1/4 cents on the day but was still down 6-1/2 cents on the week.

  • News was relatively quiet on Friday as the market keeps a close eye on the forecast for excessive heat across the middle of the country going into next week. While most of the corn crop is in the finishing stages, the high temperature will speed up maturity, and limit any additional potential the corn crop could have in most areas.

  • Grain markets are becoming concerned about the water levels on the Mississippi River for the fall harvest window. Barge restrictions have been put in place, limiting grain movement, and will have the potential to impact cash basis levels going into the fall months.

  • September corn futures moved into the delivery window against long contract positions, and again the CBOT reported “Zero” deliveries against the September contract, which is supportive of price.

  • The wheat market and outside markets have potential to influence the corn price going forward. Wheat futures continue to push to new calendar year lows and a strong U.S. Dollar Index limited gains, but crude oil closed at its highest levels since last summer, which should support ethanol and corn prices.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day slightly higher and essentially unchanged despite prices beginning the session significantly higher. Soybean meal closed lower, but soybean oil ended higher with support from crude oil and higher Malaysian palm oil.

  • Export sales have been active with a new sale reported every day this week as the U.S. becomes more competitive with Brazilian offers for new crop soybeans. Today a sale of 198,000 mt of soybeans was sold to unknown destinations.

  • There are slight chances for better rainfall in the middle of the Corn Belt over the next 7 days, but the benefits may be limited with harvest nearing. Temperatures are forecast to be hot but have turned slightly cooler than expected over the next week. The heat and dryness may push the crop into early maturity.

  • Soybean crush has been very active with profitable crush margins. The U.S. Energy Department reported that 1.21 billion pounds of soybean oil was used to make biofuels in June which is a new record high and up 49% from a year ago.

Above: After filling in the chart gap that was left between 1390-1/2 and 1394-3/4, the market has drifted lower in conjunction with stochastic indicators crossing over in overbought conditions indicating a possible downward market reversal. For now, if prices continue to slide lower, the market may find support near 1330 and again around 1300. If prices regain upward momentum, initial resistance will be in the 1400 – 1410 area.

Wheat

Market Notes: Wheat

  • Current U.S. export sales commitments are running 23% behind last year, and the slow pace not only adds resistance to prices but also fuels funds that are using the wheat market to hedge long positions in soybeans.

  • IKAR raised its production estimate for the Russian wheat crop to 91 mmt, up from 89.5. The agency also increased its Russian wheat export estimate to a record 50 mmt, which is up from last year’s 46 mmt.

  • News of UN Sec-General Guterres sending Russia a set of proposals to revive the Black Sea grain deal is likely adding resistance to the market. Putin and Turkish President Erdogan are set to meet Monday to begin discussions.

  • Australia has been dealing with very hot and dry conditions for this year’s wheat crop. After forecasting a 34% decline in production back in June, some analysts believe the country may reduce exports by as much as 10 mmt for the 23/24 season, which could be a major blow to a key buyer, China. By comparison, Australia exported over 32 mmt for 22/23.

  • El Nino rains have yet to come to help Argentina’s wheat crop, which is beginning to lose its yield potential in prime areas according to Buenos Aires Grain Exchange. Although forecasts for rain in September could help the crop get through its next growth stage.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • Grain Market Insider sees an active opportunity to buy July ’24 590 Chicago Wheat Puts on a portion of your 2024 SRW Wheat crop. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July Chicago wheat broke through a major support area around 657. Closing below 657 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the May low of 573. If the 573 level fails, the next support could be the 468 – 514 level. Buying July ’24 590 Chicago wheat puts on a portion of our SRW production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December KC wheat broke through the bottom end of its trading range and may be poised to test the September ’21 low of 670 unless bullish input enters the market to turn prices higher. If so, initial resistance above the market may rest near 772 – 780.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: The December contract resumed its downward slide and traded through the May low of 769, and is now showing signs of being oversold, which can be supportive if prices turn higher. If prices do turn higher, nearby resistance could be found near 785 – 795 and again around 810 – 820. Otherwise, the next support level below the market could come in near the June ’21 low of 730.

Other Charts / Weather

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

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Grain Market Insider: August 31, 2023

ByGrain Market Insider
The CME and Total Farm Marketing offices will be closed
Monday, September 4, in observance of Labor Day

 

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Decent 23/24 export sales that were at the upper end of expectations, though still short of the USDA’s pace, were not enough to keep the corn market on the high side of unchanged as prices came under pressure from lower trading soybeans.

  • Continued profit taking and technical selling weighed on the soybean complex as the markets sold off from overbought conditions despite solid export sales. While still closing lower on the day, soybean oil was the strong leg of the complex posting minor losses as it garnered support from higher crude and palm oil markets.

  • Weak demand, a strong US dollar, and weakness from neighboring corn and soybeans may have contributed to today’s lower close in the wheat complex, as all three classes closed on the red side of unchanged with the exception of September KC wheat that closed higher.

  • The US dollar rallied today, overtaking yesterday’s losses on ideas that the US economy is holding up comparatively well to those in Europe, with some thinking it may resume its upward trend. If so, the stronger dollar could provide headwinds to US commodity prices and export sales.

  • To see the current US Drought Monitor and 1 week drought classification changes, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • Grain Market Insider recommends selling the remaining, previously recommended, DEC ‘23 580 puts at approximately 100 cents in premium minus fees and commission to lock in gains. At the end of June, Insider recommended buying DEC ’23 580 puts for approximately 30 cents in premium plus fees and commission. At the time the US Drought Monitor was showing dryness across the Midwest and weather forecasts were calling for hot and dry conditions. Since then, conditions have improved and DEC ’23 corn has dropped over 100 cents with the recommended 580 puts gaining over 200% in value. With much of the growing season behind us, we are at the time of year when market lows are often made, and while the market may continue to recede into harvest, it is still subject to unforeseen weather like the 2020 derecho, or headlines from the Black Sea that could shock prices higher.

  • Grain Market Insider recommends selling a portion of your 2024 corn crop today. The 2023 growing season has been marked by hot and dry conditions, changing weather forecasts, and geopolitical volatility that has moved prices dramatically in both directions for both the 2023 and 2024 crops. We recognize that $5 is not the $6 or $7 that we have seen in recent memory, but much like the runup in 2012, some of the best prices for the 2013 crop were made in the summer of 2012 before they retreated that fall and into the next calendar year. Now that the 2023 growing season is winding down, 2024 prices continue to be historically favorable to get another early sale on the books, and Grain Market Insider suggests selling another portion of your 2024 production on a DEC 24 HTA contract, or DEC 24 Futures contract, so basis can be set at a later more advantageous time.  

  • 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. 

  • Extended selling pressure in the soybean market kept the corn market from holding session highs to finish slightly lower on the day. December corn lost 2-1/2 cents on the day and had a 9-3/4 cent trading range on the day. Price action stays weak overall.

  • The Weekly Export Sales report released by the USDA showed old crop corn sales at 2.8 MB and 39.0 MB in new crop sales reported last week. These totals were within market expectations. Corn sales overall are still lackluster and limiting market gains.

  • Grain markets are becoming concerned about the water levels on the Mississippi River for the fall harvest window. Barge restrictions have been put in place, limiting grain movement, and has the potential to impact cash basis levels going in the fall months.

  • September corn futures moved into the delivery window against long contract positions. The CBOT reported “Zero” deliveries against the September contract, which is supportive of price.

  • Weather forecasts are still showing limited rainfall and warmer-than-normal temperatures going into the middle of September. This should speed up maturity and limit any possible yield potential in most areas of the Corn Belt as the crop finishes out.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day sharply lower, along with both soybean meal and oil, despite the hot and dry weather and decent export sales today. Earlier in the day, soybean oil traded higher with help from higher crude and palm oil, but the entire grain complex faded lower by the end of the day.

  • Export sales were good overall despite net sales reductions for 22/23 of 50,700 mt, which was a marketing year low. For 23/24, sales were 1,123,800 mt and were primarily to unknown destinations and China. Exports of 319,700 mt were down 29% from the previous week.

  • Some crop scouts are now estimating soybean yields below 50 bpa and in some cases as low as 49.5 bpa due to the hot and dry conditions. This compares to the USDA’s last estimate of 52.0 bpa. The USDA will update their estimates on September 12.

  • The US has become much more competitive with Brazil for new crop soybean sales and as a result, there has been a sale reported nearly every day this week and significant amounts last week. This morning, a sale of 123,000 mt was reported to unknown destinations for 23/24.

Above: After filling in the chart gap that was left between 1390-1/2 and 1394-3/4, the market has drifted lower in conjunction with stochastic indicators crossing over in overbought conditions indicating a possible downward market reversal. For now, if prices continue to slide lower, the market may find support near 1330 and again around 1300. If prices regain upward momentum, initial resistance will be in the 1400 – 1410 area.

Wheat

Market Notes: Wheat

  • After trading both sides of neutral today, wheat struggled to hold any gains. All three US futures classes posted losses in tandem with Paris milling wheat futures. Weakness may have stemmed from today’s rise in the US dollar, struggling corn and soybeans, and the fact that exports are still relatively poor.

  • The USDA reported an increase of 12.1 mb of wheat export sales for 23/24 and an increase of 0.6 mb for 24/25. Export shipments are still behind the 13.9 mb pace needed per week to reach the USDA’s goal of 700 mb for 23/24. Last week’s shipments were only 13 mb.

  • Despite US soft wheat is now competitive versus other world origins, the difference in freight costs may be the anchor on exports. Yesterday, Egypt purchased wheat from Romania and France, as their freight costs are cheaper than the US.

  • Russia has reportedly said that they will discuss with Turkey an alternative to the Black Sea grain export deal. This week Sergei Lavrov, the Russian foreign minister, will meet with Hakan Fidan, the Turkish foreign minister. While the exact details are not set in stone yet, it appears that the plan would involve Russia sending grain to Turkey, where it would then be sent to countries in need.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • Grain Market Insider sees an active opportunity to buy July ’24 590 Chicago Wheat Puts on a portion of your 2024 SRW Wheat crop. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July Chicago wheat broke through a major support area around 657. Closing below 657 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the May low of 573. If the 573 level fails, the next support could be the 468 – 514 level. Buying July ’24 590 Chicago wheat puts on a portion of our SRW production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December KC wheat broke through the bottom end of its trading range and may be poised to test the September ’21 low of 670 unless bullish input enters the market to turn prices higher. If so, initial resistance above the market may rest near 772 – 780.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: The December contract resumed its downward slide and traded through the May low of 769, and is now showing signs of being oversold, which can be supportive if prices turn higher. If prices do turn higher, nearby resistance could be found near 785 – 795 and again around 810 – 820. Otherwise, the next support level below the market could come in near the June ’21 low of 730.

Other Charts / Weather

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Grain Market Insider: August 30, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • The EIA reported ethanol production numbers today that were the lowest in 3 months and added to the technical weakness potential influence of first notice day in the corn market, as prices turned south early in the session giving up the gains made overnight.  

  • After briefly trading above $14 in the overnight session, and despite another flash sale to unknown destinations, November soybeans turned sellers on the opening bell, and traded lower throughout the day to fill a gap left at 1390-1/2 and close 6 cents off the day’s low.

  • While both soybean meal and oil posted losses alongside soybeans, domestic demand for soybeans should remain strong with cash crush margins reportedly in excess of $3/bu.

  • The wheat complex ended the day mixed with Chicago and nearby KC contracts closing higher, and deferred KC contracts and Minneapolis lower, as estimates of the Canadian wheat crop by StatsCan came in 14.2% below last year, and the US State Deptartment reportedly continues to work with Ukraine and Romania to increase exports via the Danube River.

  • To see the current US 6 – 10 and 8 – 14 day Temperature and Precipitation Outlooks from NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • No action is recommended for the 2023 corn crop. This year’s growing season has been marked by dry conditions and changing weather forecasts, which have swung prices nearly 150 cents from high to low. Though dry conditions remain, with a great amount of variability in crop conditions from region to region, it may not be until after harvest before we know the full effect this growing season had on yields. Just as Insider recently recommended selling half of the previously recommended DEC 580 puts to lock in gains in case the market turns higher, Insider will continue to monitor market conditions and may consider recommending selling the remaining DEC 580 puts if conditions warrant it. While many unknowns could still shock the market higher, seasonality and current trends suggest we may not see a shift to higher prices until after harvest.

  • No action is currently recommended for 2024 corn. In 2012, the best pricing opportunities for Dec 2013 corn were during the 2012 summer runup.  Despite the significant yield losses to the 2012 crop, and the fear of running out of corn, the Dec 2013 contract peaked in the summer of 2012, and by Jan 2 of 2013, the price was already down about 12% from the high. We continue to watch the calendar for 2024 corn as this 2023 summer volatility could provide some additional opportunities to get some good early sales on the books in the event of a 2013 type repeat. Insider recently recommended making a sale on your 2024 crop, and we’ll be watching for another opportunity to suggest adding to prior early sales levels between now and the beginning of September.  

  • 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. 

  • Selling pressure weighed on the corn market as the influence of first notice day for September futures and technical weakness saw liquidation. September corn posted a new low for the moves, and December futures lost 6 cents on the session.

  • September futures are at “First Notice Day” tomorrow, and long positions need to be liquidated or risk the chance of delivery against the futures. This typically can bring additional volatility into the market. Expectations are for deliveries against September futures to be limited.

  • Brazilian export shipments for the marketing year are running ahead of pace, keeping pressure on US corn prices. The target for corn exports in Brazil is 50mmt this marketing year, but that total may need to be adjusted higher if the export pace remains strong.

  • The USDA will release weekly export sales on Thursday morning. Expectations for corn are –150,000 mt – 150,000 mt for old crop and 400,000 – 1.1 mmt for new crop sales. The old crop marketing year ends on Thursday, August 31.

  • As harvest moves closer, basis levels could be under pressure as end users become more comfortable with front-end supplies, as well as receiving freshly harvested corn. The National Average Corn basis has trended lower in recent weeks. The possibly softer cash market tone will likely weigh on futures prices.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day lower despite a higher open. Soybean meal and oil both closed lower as well despite hot and dry forecasts and another good-sized export sale this morning. November soybeans are technically overbought and may need fresh bullish news to keep momentum moving higher.

  • This morning, the USDA reported a sale of 10.0 mb of new crop soybeans to unknown destinations which comes after a string of recent export sales. The US has become more competitive with Brazilian soybean offers for new crop which has resulted in improved sales.

  • Soybean crush demand has been firm as crush margins improve significantly. Based on October futures, one bushel of 14-dollar soybeans can be crushed into $17.35 worth of soybean meal and oil.

  • A Farm Futures magazine survey of US planting intentions for 2024 found that growers expect to reduce plantings of corn in the coming year while increasing soybean acres. Soybean plantings were seen at 85.402 billion acres which is up from 2.3% from the USDA’s 2023 estimate.

Above: On August 28 the market gapped higher and closed above the 1381 – 1401 resistance area, which may now become support. Though supportive, markets tend to fill gaps over time, and it may be drawn to fill the gap left between 1390-1/2 and 1394-3/4.  For now, the next resistance level could be near 1450 and the 200-day moving average. If the market turns lower and trades through 1381 – 1401 support, further support could be found near 1330.

Wheat

Market Notes: Wheat

  • StatsCan released its estimate for Canada’s 2023 wheat production, and it came in at 29.5 mmt, 0.8 mmt lower than the 30.3 mmt expected by analysts. This year’s production is 14.2% lower than last year.

  • There are also reports that the US State Department is still working with Romania and Ukraine to increase ag exports via the Danube River.

  • Russian officials have stated without details, that Putin plans on meeting with Turkish President Erdogan. Russia has already offered to supply the country with 1 mmt of grain to be distributed to needy countries as an alternative to the Black Sea grain deal.

  • Fighting between Russia and Ukraine continues to escalate with reports of several Ukrainian drone attacks deep into Russian territory that damaged 4 large transport planes.

  • While US wheat is expecting its second lowest ending stocks-to-use ratio in 10 years, the lack of export demand continues to weigh on prices.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • Grain Market Insider recommends Buying July ’24 590 Chicago Wheat Puts on a portion of your 2024 SRW Wheat crop for approximately 30 cents plus commission and fees. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July Chicago Wheat broke through a major support area around 657. Closing below 657 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the May low of 573. If the 573 level fails, the next support could be the 468 – 514 level. Buying July ’24 590 Chicago Wheat puts on a portion of your SRW production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December KC wheat broke through the bottom end of its trading range and may be poised to test the September ’21 low of 670 unless bullish input enters the market to turn prices higher. If so, initial resistance above the market may rest near 772 – 780.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: The December contract recently broke out of the recent range to the downside. With recent support broken, the market could slide further to test the May low of 769. Next support below 769 could come in near the June ’21 low of 730. Above the market, the next area of resistance could be found near 810 – 820.

Other Charts / Weather

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Grain Market Insider: August 29, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Spillover weakness from wheat and soybeans, combined with better than expected crop ratings pressured the corn market into the close after it traded on both sides of unchanged earlier in the session.

  • Flash sales totaling 350k mt of soybeans, soybean meal and cake to unknown destinations for the 23/24 marketing year were not enough to offset the bearishness of better than expected soybean crop ratings, as all three legs of the soybean complex closed the day in the red.

  • Global markets and Brazilian harvest pressure may be adding to the weakness in the wheat complex as prices for all three classes continued their slide lower.

  • The US dollar traded 0.42% lower today after reversing course yesterday and trading to its highest level since early June last Friday. The contract is showing signs of being overbought and could lend support to commodities if it follows through to the downside.

  • To see the current US 7-day Precipitation forecast and the 8 – 14 day Temperature and Precipitation Outlooks from NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • No action is recommended for the 2023 corn crop. This year’s growing season has been marked by dry conditions and changing weather forecasts, which have swung prices nearly 150 cents from high to low. Though dry conditions remain, with a great amount of variability in crop conditions from region to region, it may not be until after harvest before we know the full effect this growing season had on yields. Just as Insider recently recommended selling half of the previously recommended DEC 580 puts to lock in gains in case the market turns higher, Insider will continue to monitor market conditions and may consider recommending selling the remaining DEC 580 puts if conditions warrant it. While many unknowns could still shock the market higher, seasonality and current trends suggest we may not see a shift to higher prices until after harvest.

  • No action is currently recommended for 2024 corn. In 2012, the best pricing opportunities for Dec 2013 corn were during the 2012 summer runup.  Despite the significant yield losses to the 2012 crop, and the fear of running out of corn, the Dec 2013 contract peaked in the summer of 2012, and by Jan 2 of 2013, the price was already down about 12% from the high. We continue to watch the calendar for 2024 corn as this 2023 summer volatility could provide some additional opportunities to get some good early sales on the books in the event of a 2013 type repeat. Insider recently recommended making a sale on your 2024 crop, and we’ll be watching for another opportunity to suggest adding to prior early sales levels between now and the beginning of September.  

  • 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. 

  • Selling pressure across the grain complex pressured corn futures as prices reversed off the session highs and Dec corn closed 9-1/2 cents lower on the day. The weak price action damaged the charts technically and could bring additional selling pressure for tomorrow’s session.

  • Weekly crop progress numbers showed corn rated good to excellent fell only 2% to 56%, where a 3% drop was expected, and 17% of the crop was rated poor to very poor. The eastern Corn Belt ratings improved week over week, despite the recent hot weather.

  • Weather forecasts are staying on the warmer and drier side, but the impact of Hurricane Idalia in the Gulf could trigger some moisture in the Corn Belt.

  • As harvest moves closer, basis levels could be under pressure as end users become more comfortable with front-end supplies, as well as receiving freshly harvested corn. The possibly softer cash market tone will likely weigh on futures prices.

  • Brazilian corn crop harvest is nearing completion at 83% harvested last week. The northern regions are starting planting of next spring’s new crop, with 7% of corn being planted as of last week.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, prices could turn higher if the market receives additional bullish input. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Above: 2023/24 Corn condition percent good-excellent (red) versus the 5-year average (green) and last year (pink).

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day lower, along with both soybean meal and oil, after yesterday’s Crop Progress report showed very little crop degradation compared to what trade was expecting. Export sales this morning offered some support earlier in the day before prices faded again.

  • Yesterday’s crop progress data showed little degradation in the soybean crop with good to excellent ratings falling only one point to 58% despite the heat and dry conditions. Trade was expecting 56%. 91% of the crop is setting pods and 5% is dropping leaves.

  • As the US becomes more competitive with Brazil, exports have begun to pick up over the past few weeks with two sales being reported today. 246,100 metric tons of soybeans were sold to unknown destinations for the 23/24 marketing year, and 105,000 metric tons of soybean meal were sold to unknown destinations, also the 23/24 marketing year.

  • Weather forecasts over the next 14 days or more are showing above normal temperatures and below average precipitation which could cause crop ratings to fall more significantly in the coming weeks.

Above: On August 28 the market gapped higher and closed above the 1381 – 1401 resistance area, which may now become support. Though supportive, markets tend to fill gaps over time, and it may be drawn to fill the gap left between 1390-1/2 and 1394-3/4.  For now, the next resistance level could be near 1450 and the 200-day moving average. If the market turns lower and trades through 1381 – 1401 support, further support could be found near 1330.

Above: 2023/24 Soybeans condition percent good-excellent (red) versus the 5-year average (green) and last year (pink).

Wheat

Market Notes: Wheat

  • US wheat futures may have inherited some weakness today from other global markets. Matif wheat futures closed lower, and harvest progress in Brazil is putting pressure on their prices as well.

  • According to Interfax and the Russian Grain Union, Russia’s grain exports increased 27% year on year. Wheat shipments specifically were up 29% from August 1st to 27th.

  • Concerns about China’s economy may be weighing on the grain complex as a whole. China is the world’s largest commodity buyer, so demand is a legitimate worry. China announced that they are going to reduce mortgage rates to help stimulate the economy, but so far, their attempts have had little success.

  • December Chicago wheat posted a new contract low today at 5.99-1/2 but was able to close just above support at 6.00. Technically, it is oversold and could be due for a correction to the upside but may not have the fundamental support to sustain any significant rally.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • No action is currently recommended for 2024 Chicago wheat. Since the middle of June price volatility has risen with updated USDA reports, changing weather forecasts, and current events in the Black Sea.  While prices continue to be volatile, plenty of time remains to market the 2024 crop. War continues in the Black Sea region, the world stocks-to-use ratio is the lowest in 8 years, and no one knows what the weather will bring, leaving the market vulnerable to many uncertainties. For now, after recommending making a sale for the 2024 crop, and while keeping an eye on the market to see if any major support is broken, Grain Market Insider would need to see prices north of 800 before considering recommending any additional sales.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: December KC wheat broke through the bottom end of its trading range and may be poised to test the September ’21 low of 670 unless bullish input enters the market to turn prices higher. If so, initial resistance above the market may rest near 772 – 780.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: Since the middle of August, the market has been consolidating between nearby support and resistance of 786 and 820.  Should the market break out of the current range, key support below the market lies near the May low of 769, with the next support level near the June ’21 low of 730.  Above the market, the next area of resistance could be found near 837.

Above: 2023/24 Spring wheat percent harvested (red) versus the 5-year average (green) and last year (purple).

Other Charts / Weather

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

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Grain Market Insider: August 28, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • A warm and dry two-week forecast and strong export inspection totals helped to support the corn market which gapped 5-1/2 cents higher on the open Sunday night.  

  • The USDA reported a 296k mt flash sale of 23/24 soybeans to unknown destinations which helped rally the soybean market after it gapped higher on the open Sunday night on a less-than-ideal warm and dry forecast.

  • Soybean meal continues to garner strength to possibly challenge the July highs on talk that Argentina may stop exporting meal come October due to their short harvest. While following a weak start, bean oil was also able to follow through on Friday’s gains and close in the green.

  • Despite strength in corn and soybeans, all three wheat classes succumbed to market sellers as Black Sea exports continue, and talks may resume between Russia and Turkey about renewing the Black Sea export corridor. 

  • To see the current US 8 – 14 day Temperature and Precipitation Outlooks from NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • No action is recommended for the 2023 corn crop. This year’s growing season has been marked by dry conditions and changing weather forecasts, which have swung prices nearly 150 cents from high to low. Though dry conditions remain, with a great amount of variability in crop conditions from region to region, it may not be until after harvest before we know the full effect this growing season had on yields. Just as Insider recently recommended selling half of the previously recommended DEC 580 puts to lock in gains in case the market turns higher, Insider will continue to monitor market conditions and may consider recommending selling the remaining DEC 580 puts if conditions warrant it. While many unknowns could still shock the market higher, seasonality and current trends suggest we may not see a shift to higher prices until after harvest.

  • No action is currently recommended for 2024 corn. In 2012, the best pricing opportunities for Dec 2013 corn were during the 2012 summer runup.  Despite the significant yield losses to the 2012 crop, and the fear of running out of corn, the Dec 2013 contract peaked in the summer of 2012, and by Jan 2 of 2013, the price was already down about 12% from the high. We continue to watch the calendar for 2024 corn as this 2023 summer volatility could provide some additional opportunities to get some good early sales on the books in the event of a 2013 type repeat. Insider recently recommended making a sale on your 2024 crop, and we’ll be watching for another opportunity to suggest adding to prior early sales levels between now and the beginning of September.  

  • 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. 

  • Corn futures followed the strength in soybean markets, adding some weather premium to close 7-8 cents higher. Dec corn futures may be looking to challenge the $5.00 level as the next level of resistance.

  • Overall, weather forecasts going into September are remaining warmer and drier than normal, which may bring the crop to maturity faster than anticipated. The market is pricing in some reduced potential yield from current levels.            

  • Weekly export inspections were above expectations on Monday. Last week, exporters shipped 597,000 MT of corn, slightly above expectations. Year to date, weekly export inspections are still 33% behind last year with the market year ending on August 31.

  • Demand is still a question, but the USDA reported routine corn sales continuing to Mexico. Mexico purchased 130,000MT of US corn on a flash sale for the 2023-24 marketing year.

  • Pro Farmer released its projected national yield for the year at 172.0 bu/acre, currently under the USDA and last year’s levels. With the weather forecast, the market is likely adding some premium in case USDA projections for production is high. The next USDA crop production report will be released on September 12.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. While the reversal is a bearish development, continued bullish input will be needed to turn prices higher. Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Above: Corn Managed Money Funds net position as of Tuesday, August 22. Net position in Green versus price in Red. Managers net sold 33,555  contracts between Aug. 15 – 22, bringing their total position to a net short 106,135 contracts.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans closed higher today along with both soybean meal and oil. Soybeans gapped higher overnight as weekend forecasts came out showing more heat and dryness that is expected to last for at least the next 7 days.

  • US exports have been improving as the US is becoming more competitive with Brazilian soybean prices as their basis picks up. A flash sale was reported this morning of 296,000 metric tons for delivery to unknown destinations for the 23/24 marketing year. Exports should continue to improve as Brazil turns its focus to corn planting.

  • Soybean export inspections came in as expected at 11.8 mb for the week ending Thursday, August 24, and total inspections for 22/23 are now at 1.906 bb which is down 8% from the previous year. Inspections are running on par with USDA expectations.

  • Pro Farmer’s crop tour ended last week with an average national yield guess of 49.7 bpa, which has added to support, but the USDA’s current guess is higher at 50.9 bpa. The USDA will revise this number in the September WASDE, but there is also a chance that they adjust acreage as well.

Above: On August 28 the market gapped higher and closed above the 1381 – 1401 resistance area, which may now become support. Though supportive, markets tend to fill gaps over time, and it may be drawn to fill the gap left between 1390-1/2 and 1394-3/4.  For now, the next resistance level could be near 1450 and the 200-day moving average. If the market turns lower and trades through 1381 – 1401 support, further support could be found near 1330.

Above: Soybeans Managed Money Funds net position as of Tuesday, August 22. Net position in Green versus price in Red. Money Managers net bought 7,487 contracts between August 15 – 22, bringing their total position to a net long 58,206 contracts.

Wheat

Market Notes: Wheat

  • The USDA reported 390k mt of wheat were inspected for export as of August 24. While this is up from the previous week’s number of 311k mt, and above the upper end of expectations, the year-to-date total is down 21% from last year.

  • A second ship that has left Ukraine through the Black Sea in Ukraine’s new humanitarian corridor safely reached Romania despite Russia backing out of the grain deal.

  • There are reports that Vladimir Putin is set to meet with Turkish President Erdogan, possibly next week, to discuss the Black Sea export corridor deal.

  • There is dryness in both Argentina and Australia that could impact wheat yields. India is also having weather issues and is considering abolishing its import tax on wheat to help millers buy cheaper grain to help rein in rising domestic prices.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • No action is currently recommended for 2024 Chicago wheat. Since the middle of June price volatility has risen with updated USDA reports, changing weather forecasts, and current events in the Black Sea.  While prices continue to be volatile, plenty of time remains to market the 2024 crop. War continues in the Black Sea region, the world stocks-to-use ratio is the lowest in 8 years, and no one knows what the weather will bring, leaving the market vulnerable to many uncertainties. For now, after recommending making a sale for the 2024 crop, and while keeping an eye on the market to see if any major support is broken, Grain Market Insider would need to see prices north of 800 before considering recommending any additional sales.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596. If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

Above: Chicago Wheat Managed Money Funds net position as of Tuesday, August 22. Net position in Green versus price in Red. Money Managers net sold 5,331 contracts between August 15 – 22, bringing their total position to a net short 70,921 contracts.

KC Wheat Action Plan Summary

Above: The K.C. wheat market continues its sideways trend between 733 – 780, with the low end of the range acting as initial support, while the upper end of the range acts as initial resistance. If prices break out to the upside, psychological resistance sits around the 800 area. While below the market, the next area of major support is near the September ’21 low of 670.

Above: KC Wheat Managed Money Funds net position as of Tuesday, August 22. Net position in Green versus price in Red. Money Managers net sold 6,552 contracts between August 15 – 22, bringing their total position to a net short 5,965 contracts.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the US, but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: Since the middle of August, the market has been consolidating between nearby support and resistance of 786 and 820.  Should the market break out of the current range, key support below the market lies near the May low of 769, with the next support level near the June ’21 low of 730.  Above the market, the next area of resistance could be found near 837.

Above: Minneapolis Wheat Managed Money Funds net position as of Tuesday, August 22. Net position in Green versus price in Red. Money Managers net sold 4,723 contracts between August 15 – 22, bringing their total position to a net short 6,234 contracts.

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Grain Market Insider: August 25, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Despite the lack of rain in the forecast, a weaker wheat market and the potential for more Fed rate hikes weighed on the corn market, which traded on both sides of unchanged before closing mixed, with nearby contracts settling marginally lower and deferred contracts fractionally higher.

  • Another flash sale of 121k mt to China and a warm and dry two week forecast kept support under the soybean market, which settled at its highest level in nearly a month.

  • Soybean meal and oil also finished in the green with .7% and 1.9% gains respectively, as meal continued its trek higher supported by a firmer Brazilian export basis, and oil shrugged off yesterday’s losses, supported by higher heating oil (diesel) and palm oil prices.

  • A strong U.S. dollar and estimates of record Russian wheat exports for the 23/24 season from Agritel weighed most heavily on the Chicago contracts, which closed the day in the red. K.C. and Minneapolis contracts fared better with both classes settling in the green.

  • Fed Chairman Jerome Powell remarked in a speech from Jackson Hole, WY today that economy is growing faster than anticipated and the Federal Reserve may raise interest rates further to achieve its 2% inflation rate goal. Rates staying elevated for an extended length of time or rising further is supportive to the U.S. dollar and could add resistance to commodity prices.

  • To see the current U.S. Seasonal Drought Outlook from NOAA, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • No action is recommended for the 2023 corn crop. This year’s growing season has been marked by dry conditions and changing weather forecasts, which have swung prices nearly 150 cents from high to low. Though dry conditions remain, with a great amount of variability in crop conditions from region to region, it may not be until after harvest before we know the full effect this growing season had on yields. Just as Insider recently recommended selling half of the previously recommended DEC 580 puts to lock in gains in case the market turns higher, Insider will continue to monitor market conditions and may consider recommending selling the remaining DEC 580 puts if conditions warrant it. While many unknowns could still shock the market higher, seasonality and current trends suggest we may not see a shift to higher prices until after harvest.

  • No action is currently recommended for 2024 corn. In 2012, the best pricing opportunities for Dec 2013 corn were during the 2012 summer runup.  Despite the significant yield losses to the 2012 crop, and the fear of running out of corn, the Dec 2013 contract peaked in the summer of 2012, and by Jan 2 of 2013, the price was already down about 12% from the high. We continue to watch the calendar for 2024 corn as this 2023 summer volatility could provide some additional opportunities to get some good early sales on the books in the event of a 2013 type repeat. Insider recently recommended making a sale on your 2024 crop, and we’ll be watching for another opportunity to suggest adding to prior early sales levels between now and the beginning of September.  

  • 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. 

  • Quiet day in the corn market as prices were stuck between strong soybean prices and a pressured wheat market. Overall, corn prices finished steady to slightly lower on the session.  For the week, Dec corn futures traded 5 cents lower.

  • Pro Farmer completed its annual crop tour on Thursday and released yields for Minnesota and Iowa. Minnesota corn yield was disappointing at 181.34 bu/acre, down from last year’s levels, and Iowa corn yield was 182.8 bu/acre, just slightly below last year. Pro Farmer released its projected national yield for the year at 172.0 bu/acre, currently under the USDA and last year’s level.

  • As the market tries to narrow in on potential yield estimates, demand will stay a focus. Current new crop corn sales are disappointing. China is down 91% in corn purchase for the new marketing year, compared to last year. Rallies in the corn market may stay limited if demand remains slow.

  • Longer range weather forecasts are pushing the heat dome back to the South, but the Corn Belt will have limited rainfall until next week. The forecasted conditions may push maturity and limit any chances for the crop to finish out strong.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. The reversal is a bearish development, likely needing bullish input to turn prices back higher.  Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans traded higher today, with the November contract ending the week 34-1/2 cents higher. December soybean meal ended the week with a large gain, and soybean oil posted a small weekly loss. Crush margins improved this week.

  • The Pro Farmer crop tour released pod counts for most states that were slightly above the 3-year averages, but their final yield estimate was 49.7 bpa, which is below the USDA’s estimate of 50.9, but above last year’s number of 49.5. The USDA typically estimates yields higher than the crop tour.

  • Soybeans are gaining support from the extreme heat and rain that has been absent for over 10 days in the Midwest during crucial pod filling time. The heat is expected to ease up going into this weekend, but rain is light in the forecast over the next 7-days.

  • November soybeans on the Dalian exchange were up 1.5% today to make a new high for 2023 at $19.03 a bushel, which has resulted in increased export sales activity. Adding to the recent string of sales, another one was reported today to unknown destinations in the amount of 121,000 metric tons.

Above: Since the end of July, the soybean market has turned lower, and attempts to rally have been met with resistance between 1381 and 1401. If the market breaks through to the upside, it may find further resistance near the 200-day moving average. If prices break to the downside, support below the market may be found between 1318 – 1300. 

Wheat

Market Notes: Wheat

  • After Fed chairman Powell’s comments this morning about potentially more interest rate increases, the U.S. Dollar Index hit the highest level in almost three months. If the dollar remains in an uptrend, it will continue to pressure wheat as it makes U.S. exports more expensive for importing countries.

  • According to consultancy group, Agritel, Russia’s 23/24 wheat exports are expected to be record large at 49 mmt. Additionally, the production estimate from Sov Econ is up 5 mmt from last month.

  • Odesa is introducing a grain export control mechanism, in which vessels will only be loaded after the legality of the grain’s origin is determined. Apparently, many grain sales are not transparent, which is reducing revenue needed for the military.

  • Turkey is said to be encouraging Russia to re-open the Black Sea grain export deal and government officials will meet with Putin. Russia’s foreign minister, Sergei Lavrov, reportedly told the UN Secretary General that Russia would return to the deal only if the West fulfills obligations to Russia.

  • Due to the dry conditions in Canda, there is thought that their production will fall below the USDA’s estimated 33 mmt. On Tuesday, Stats Canada is anticipated to reflect this in their crop production estimates.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 800 level before considering any additional sales.

  • No action is currently recommended for 2024 Chicago wheat. Since the middle of June price volatility has risen with updated USDA reports, changing weather forecasts, and current events in the Black Sea.  While prices continue to be volatile, plenty of time remains to market the 2024 crop. War continues in the Black Sea region, the world stock to use ratio is the lowest in 8 years, and no one knows what the weather will bring, leaving the market vulnerable to many uncertainties. For now, after recommending making a sale for the 2024 crop, and while keeping an eye on the market to see if any major support is broken, Grain Market Insider would need to see prices north of 800 before considering recommending any additional sales.

  •  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.

Above: The Chicago wheat market appears to be consolidating between 650 and 596.  If the market breaks out to the upside, the next level of resistance may be found near 665, if not, and the market drifts lower, the next level of support below the market may be found near 573.

KC Wheat Action Plan Summary

Above: The K.C. wheat market continues its sideways trend between 733 – 780, with the low end of the range acting as initial support, while the upper end of the range acts as initial resistance. If prices break out to the upside, psychological resistance sits around the 800 area. While below the market, the next area of major support is near the September ’21 low of 670.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the U.S., but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • No 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 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. For now, plenty of time remains to market the 2024 crop and Insider is content to see how the market develops before suggesting making any additional sales. 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.

  • 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.

Above: Since the middle of August, the market has been consolidating between nearby support and resistance of 786 and 820.  Should the market break out of the current range, key support below the market lies near the May low of 769, with the next support level near the June ’21 low of 730.  Above the market, the next area of resistance could be found near 837.

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Grain Market Insider: August 24, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Weak export sales, in addition to reports of decent yields with plenty of variability from Pro Farmer’s crop tour, had the corn market searching for value as it settled the day mixed after choppy trade, with nearby contracts weaker, while deferred contracts closed higher.

  • The need for additional rain and a strong soybean meal market, with $11.30 gains in the December contract, outweighed the negativity from soybean oil and helped rally soybeans back toward this week’s highs.

  • The rally in meal may have come from a rising Brazilian export basis and talk that they might slow their crush pace, which could swing demand to the U.S., increasing meal exports.

  • Despite decent export sales that came in above expectations and 13% higher from the previous week, the wheat market continued to consolidate as the entire complex closed weaker on the day, with the exception of Sept. ’24 Minneapolis, which closed higher.

  • The U.S. dollar rebounded today to challenge yesterday’s highs and the recent strength, while adding resistance to commodity markets could stem from flight to quality buying where, traders view the current U.S. economy more favorably than its EU counterparts.

  • To see the current U.S. Drought Monitor and a map showing the Drought Monitor class changes, scroll down to the other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  • No action is recommended for the 2023 corn crop. This year’s growing season has been marked by dry conditions and changing weather forecasts, which have swung prices nearly 150 cents from high to low. Though dry conditions remain, with a great amount of variability in crop conditions from region to region, it may not be until after harvest before we know the full effect this growing season had on yields. Just as Insider recently recommended selling half of the previously recommended DEC 580 puts to lock in gains in case the market turns higher, Insider will continue to monitor market conditions and may consider recommending selling the remaining DEC 580 puts if conditions warrant it. While many unknowns could still shock the market higher, seasonality and current trends suggest we may not see a shift to higher prices until after harvest.

  • No action is currently recommended for 2024 corn. In 2012, the best pricing opportunities for Dec 2013 corn were during the 2012 summer runup.  Despite the significant yield losses to the 2012 crop, and the fear of running out of corn, the Dec 2013 contract peaked in the summer of 2012, and by Jan 2 of 2013, the price was already down about 12% from the high. We continue to watch the calendar for 2024 corn as this 2023 summer volatility could provide some additional opportunities to get some good early sales on the books in the event of a 2013 type repeat. Insider recently recommended making a sale on your 2024 crop, and we’ll be watching for another opportunity to suggest adding to prior early sales levels between now and the beginning of September.  

  • 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. 

  • Corn futures saw choppy and pressured trade before settling with small losses on the day. Dec corn slipped 2 ¼ cents, as the Pro Farmer tour continues to find solid yields, but a lot of variability. Soft export sales report and expiration of September options on Friday limit the market’s upside.

  • Demand will stay the focus of the market. The USDA released weekly export sales numbers for last week on Thursday morning. Old crop sales saw net cancellations of 22,500 MT, but added 673,500 MT to the new crop book. The current marketing year ends on Aug 31.

  • September corn options expire on Friday, which could lead to an increase in volatility as prices have a tendency to move to large areas of open interest. As of Thursday morning, there were 17,660 open puts at the Sept. 480 strike price.

  • The Pro Farmer crop tour continues to find variable, but moderately good yields, which may confirm the possible corn supply available this harvest. Yesterday, Pro Farmer forecasted corn yield in Illinois of 193.72 bu/acre, above last year’s levels. The tour moved into Iowa and Minnesota for its last day of sampling on Thursday, with a final yield projection to be released on Friday afternoon.

  • Longer range weather forecasts are pushing the heat dome back to the South, but the Corn Belt will have limited rainfall until next week. The forecasted conditions may push maturity and limit any chances for the crop to finish out strong.

Above: After trading mostly sideways since the end of July, December corn posted a bearish reversal on 8/21 after testing the 495 – 516 resistance level. The reversal is a bearish development, likely needing bullish input to turn prices back higher.  Should that happen, resistance above the market remains between 495 – 516. If not and prices turn lower, support may be found near 460 and again near 415.

Soybeans

Soybeans Action Plan Summary

  • No action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from the changing weather forecasts, crop conditions, and export sales. We ended the month of July experiencing hot conditions with little rainfall and weak export sales. Since then, conditions have become more favorable, and export sales have picked up. While much of the crop remains in drought conditions, which can maintain upside potential, timely rains may come and push prices lower. Much like in 2012, when July was dry, and the pattern changed in August, when decent rain fell in parts of the western Corn Belt and IL, sending Nov ’12 soybeans down 20%. 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 the 2024 crop, though it may not be until after harvest or toward year’s end before we will consider recommending any 2024 crop sales.

  • 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.

  • Soybeans ended the day higher for the second day, along with soybean meal, but soybean oil was lower. Demand for soybean meal has been firm with Brazilian soymeal basis up $22 per ton this week, and an export sale of 100,000 mt of soybean cake was reported to unknown destinations.

  • Temperatures today hit a range between 98 and 106 degrees in Nebraska, Missouri, Iowa, and Illinois at a critical time for the soy crop, but temperatures are expected to drop after today. Although the heat is expected to subside, another two weeks of dry conditions are also expected.

  • The Pro Farmer tour finished its rounds of Illinois yesterday, and found an average of soybean pod counts in a 3×3 area at 1,270.61, which is above a year ago and the 3-year average. The tour is in Iowa today, and results can be expected by tomorrow, but early corn yields were seen struggling today.

  • China is conducting trials on GMO soybeans and corn, as well as  yields, were up to 11.6% higher in those trials. China has not yet approved commercial planting of GMO grains, but may change that stance as they try to become as independent as possible.

Above: Since the end of July, the soybean market has turned lower, and attempts to rally have been met with resistance between 1381 and 1401. If the market breaks through to the upside, it may find further resistance near the 200-day moving average. If prices break to the downside, support below the market may be found between 1318 – 1300. 

Wheat

Market Notes: Wheat

  • Today, the USDA released export sales for last week and reported an increase in wheat sales totaling 14.9 mb for 23/24. Shipments last week totaling 12.7 mb were below the 13.9 mb pace needed to reach the 700 mb USDA export goal.

  • The US dollar rebounded today, keeping pressure on wheat. Russian exports also added pressure to the market. While they set a $270 per ton floor on wheat exports, it only applies to public tenders, whereas, private tenders are reportedly cheaper and still beating out many world origins.

  • While Argentina continues to be too dry, the Rosario Stock Exchange said that rains should pick up in October with a milder El Nino, and should offer some relief as the southern hemisphere heads into summer.

  • France is the largest wheat producer and exporter in the EU. According to Agritel, French wheat exports are projected to increase to 17 mmt in 23/24, as compared to 16.4 mmt in the previous season. They did leave the French wheat harvest unchanged at 34.8 mmt.

Chicago Wheat Action Plan Summary

  • No new action is recommended for 2023 crop. Since the end of May, the wheat market has been largely rangebound, 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 rearview mirror, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region, 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 the 650 level before considering any additional sales.

  • No action is currently recommended for 2024 Chicago wheat. Since the middle of June price volatility has risen with updated USDA reports, changing weather forecasts, and current events in the Black Sea.  While prices continue to be volatile, plenty of time remains to market the 2024 crop. War continues in the Black Sea region, the world stock to use ratio is the lowest in 8 years, and no one knows what the weather will bring, leaving the market vulnerable to many uncertainties. For now, after recommending making a sale for the 2024 crop, and while keeping an eye on the market to see if any major support is broken, Grain Market Insider would need to see prices north of 800 before considering recommending any additional sales.

  •  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.

Above: The Chicago wheat market appears to be consolidating and is recovering from being oversold. Initial support below the market resides between 596 and 573. Above the market, resistance could be found between 664 and 684.

KC Wheat Action Plan Summary

  • We continue to look for better prices before making any 2023 sales. As more becomes known about this year’s crop with some reports of better than expected yields, questions remain about the world wheat supply.  War continues in the Black Sea region, Ukraine’s export capabilities remain uncertain, and dryness continues in key production areas of the world. With a world stock to use ratio at its lowest level in 8 years, we continue to target 950 – 1000 in the July futures as a potential level to suggest the next round of New Crop sales.  At the same time, we continue to watch the bottom end of the range that prices have traded in since late 2022. A close below the bottom end would reduce the probability of getting to 950 – 1000 and would increase the risk of prices falling into the 600 – 650 range.     

  • Grain Market Insider sees an active opportunity to buy July ’24 660 K.C. wheat puts on a portion of your 2024 HRW wheat crop for approximately 30 cents plus commission and fees. While weather has been a dominant feature of the market this year with dry growing conditions and harvest delays, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July K.C. Wheat has traded through a major support area around 738. Trading below 738 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the September ’21 low of 678. If the 678 level were to fail, next support could be the 560 – 573 level. Buying July ’24 660 K.C. Wheat puts on a portion of your HRW wheat production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  • 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.

Above: The K.C. wheat market continues its sideways trend between 733 – 780, with the low end of the range acting as initial support, while the upper end of the range acts as initial resistance. If prices break out to the upside, psychological resistance sits around the 800 area. While below the market, the next area of major support is near the September ’21 low of 670.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2023 New Crop. Weather has been a dominant feature to price volatility this growing season, with continued dryness concerns in not only the U.S., but also Canada and Australia. While there typically isn’t a strong likelihood of higher prices until after harvest is complete, both weather and geopolitical events can change suddenly to move prices higher. Insider will consider making sales suggestions if prices improve, while also continuing to watch the downside for any further violations of support.

  • Grain Market Insider sees an active opportunity to buy July ‘24 660 K.C. wheat puts on a portion of your 2024 Spring wheat crop for approximately 30 cents plus commission and fees. While weather has been a dominant feature of the market this year with a wet spring, late planting, and growing conditions that have been less than ideal, slow export demand and cheap Russian exports remain major headwinds to prices. The market has turned lower in recent weeks and July K.C. Wheat has traded through a major support area around 738. Trading below 738 support signals that the major trend may be turning down and poses the risk that prices could erode further in the weeks ahead, possibly to the next level of support, the September ’21 low of 678. If the 678 level were to fail, next support could be the 560 – 573 level. The K.C. wheat market is highly correlated to the Minneapolis wheat market and much more liquid, which makes it a better choice when employing options strategies for Spring Wheat. Buying July ’24 660 K.C. Wheat puts on a portion of your spring wheat production should help protect future sales from further downside erosion, while still allowing for upside appreciation should the market turn higher.

  • 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.

Above: Since 7/25, the market has been in a down trend and is oversold. Currently, key support below the market lies near the May low of 769, with the next support level near the June ’21 low of 730.  Above the market, nearby resistance could be found near 820 – 837.

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