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Opening Update: September 7, 2023

ByGrain Market Insider

All prices as of 6:30 am Central Time

Corn

DEC ’23 486 0.25
MAR ’24 500.5 0.5
DEC ’24 511.5 0.5

Soybeans

NOV ’23 1370.75 -5.5
JAN ’24 1384 -5.25
NOV ’24 1293.25 -4.25

Chicago Wheat

DEC ’23 608.75 -0.25
MAR ’24 634.75 0.25
JUL ’24 660.25 1.25

K.C. Wheat

DEC ’23 746.25 -3.25
MAR ’24 749.75 -2.25
JUL ’24 733 -4

Mpls Wheat

DEC ’23 785.5 3
MAR ’24 803.75 3.25
SEP ’24 810 16.5

S&P 500

DEC ’23 4505.5 -15

Crude Oil

NOV ’23 86.29 -0.5

Gold

DEC ’23 1945.1 0.9

If you missed our latest strategy update, click here:  Grain Market Insider Strategy Update

  • Corn is unchanged to start the day with little reaction to the hot and dry conditions. Harvest is nearing and the crop is pretty well made at this point.

  • The 7-day forecast features better chances for rain in the western Corn Belt while the rest of the Belt is expected to receive very limited showers.

  • Most private analysts are estimating yields above 170 bpa, but things could change quickly when the USDA updates their estimates on Tuesday.

  • The USDA has previously estimated 94.1 million acres of planted corn which could be adjusted in the WASDE report. This comes at the same time that Brazil harvests a record crop.

  • Soybeans are trading lower this morning after yesterday’s higher close with both soybean meal and oil lower. Trade has been rangebound and will likely continue that way until the USDA report is released.

  • 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.

  • Export sales have been active with total new crop sales up to 526 mb so far, and tomorrow’s weekly export sales are expected to be solid.

  • November soybeans on the Dalian exchange ended lower by 0.4% today, but are still very expensive at the equivalent of $18.80 per bushel. 

  • Wheat posted solid gains yesterday but is starting the day softer. Yesterday’s rally may have been due to the attacks on Ukrainian port cities.

  • Russia has made it clear that they would not return to the Black Sea grain deal any time soon, but Ukraine appears to be letting ships carrying grain trickle out of their own humanitarian corridor.

  • Spring wheat harvest in the US is going well and will be helped along by a dry forecast for the northwestern US. In HRW wheat regions, upcoming rains will be needed to improve soil moisture.

  • Overnight there were no new attacks reported in Ukraine, but a blast was reported at Russian headquarters in Rostov, and Ukrainian forces are reportedly making progress against Russian forces.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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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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Midday Update: September 6, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
DEC ’23 489.75 3.75
MAR ’24 504.5 3.5
DEC ’24 513.75 1.5
Soybeans
NOV ’23 1380.75 15.75
JAN ’24 1394 15
NOV ’24 1303.25 4.5
Chicago Wheat
DEC ’23 613.75 14.5
MAR ’24 639.5 14.5
JUL ’24 661.75 14
K.C. Wheat
DEC ’23 749 24.5
MAR ’24 752.5 23.75
JUL ’24 738.25 20.5
Mpls Wheat
DEC ’23 781.75 19.5
MAR ’24 799.75 19.75
SEP ’24 800 6.5
S&P 500
DEC ’23 4514.25 -37.75
Crude Oil
NOV ’23 85.89 -0.12
Gold
DEC ’23 1942.1 -10.5

  • Corn is trading higher near midday after yesterday’s Crop Progress report showed a sharper than expected drop in ratings.

  • The good to excellent rating fell by 3% to 53% which is the lowest reading since the 2012 drought year. Illinois ratings fell by 10% and Iowa fell by 5%.

  • Ag Rural has reported that Brazil’s second crop corn is now nearing 88% harvested, while their first corn crop is nearing 13% planted.

  • Weather forecasts for the next 6 to 10 days are trending cooler for the entire Corn Belt with above average precipitation expected for the western Corn Belt.

  • November soybeans gapped higher yesterday evening but have moved slightly lower. Soybeans are still trading higher along with soybean meal, while soybean oil is lower.

  • 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.

  • 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.

  • Oil World sees Palm oil prices rising by more than 10% in the coming months amid poor production growth. The decline of palm oil production should raise dependence on soybean, sunseed, and rapeseed.

  • Wheat is trading higher today as global wheat production in countries apart from Russia is seen falling, and as Russia attacked more port cities in Ukraine.

  • Overnight, Russia sent drones to both the Odesa and Danube River ports delivering three-hour drone strikes which damaged several agricultural and port facilities.

  • The Australian wheat crop has suffered heat and drought and is now being estimated at just 25.4 mmt which would be down 36% from last year.

  • SovEcon has raised their estimates for Russian 23/24 wheat exports to 48.6 mmt citing increases in the production estimate.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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Opening Update: September 6, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

DEC ’23 488.5 2.5
MAR ’24 503.5 2.5
DEC ’24 514.25 2

Soybeans

NOV ’23 1377.75 12.75
JAN ’24 1391.5 12.5
NOV ’24 1305 6.25

Chicago Wheat

DEC ’23 605 5.75
MAR ’24 631.25 6.25
JUL ’24 652.25 4.5

K.C. Wheat

DEC ’23 732 7.5
MAR ’24 736.25 7.5
JUL ’24 719 1.25

Mpls Wheat

DEC ’23 769 6.75
MAR ’24 780.5 0.5
SEP ’24 793 -0.5

S&P 500

DEC ’23 4544.25 -7.75

Crude Oil

NOV ’23 85.59 -0.42

Gold

DEC ’23 1950.9 -1.7

If you missed our latest strategy update, click here:  Grain Market Insider Strategy Update

  • Corn gapped higher at the beginning of trading yesterday evening on lower crop ratings.  Since then, the market has filled the gap, but continues to trade higher this morning.

  • In Tuesday’s weekly crop progress report, the USDA lowered the good/excellent rating for the corn crop by 3% to 53%, which compares to last year’s 54% rating for the same week.  The maturity of the crop jumped 9% as well to 18%.

  • U.S. corn exports are down 32% from last year, at 52.2 mmt, and EU corn imports for 23/24 as of September 3, were 2.7 mmt, 41% below the 4.55 mmt for the same week last year.

  • Low Mississippi river levels have forced barge lines to reduce volumes to New Orleans, which in turn has lent support to Brazil’s corn exports.

  • Soybeans opened 12 cents higher yesterday evening on lower-than-expected crop ratings.  Soybean meal is currently trading sharply higher with beans, while soybean oil is lower following lower palm and crude oil prices.

  • The USDA lowered soybean good/excellent ratings in Tuesday’s weekly update by 5%.  The crop is now rated 53% good/excellent, compared to last year’s 55% rating.  The percentage of the crop dropping leaves also increased to 16%, from last week’s 5%.

  • 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.

  • 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.  In order to reach the USDA’s goal of 2.22 bb, August crush will need to tie the 2019 record of 177 mb, which is possible as processors have been well incentivized with high crush margins. 

  • Wheat is trading higher this morning with all three classes on the positive side of unchanged led by K.C.

  • Spring wheat harvest is clicking along with 74% of crop harvested as of Sunday, September 3, 3% behind the average for this date, but a 20% jump from last week.  Winter wheat is estimated to be 1% planted versus 3% on average.

  • U.S. wheat exports continue to be slow and are currently running 24% behind last year’s pace with 4.3 mmt shipped.

  • There were reports of Russian drone attacks on Ukraine’s Danube River port of Ismail that damaged grain elevators and killed one worker.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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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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Midday Update: September 5, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
DEC ’23 485.25 3.75
MAR ’24 500 3.5
DEC ’24 511 1.5
Soybeans
NOV ’23 1366.75 -2.5
JAN ’24 1380.25 -2.5
NOV ’24 1295.25 2.25
Chicago Wheat
DEC ’23 601 5.5
MAR ’24 626.5 4.5
JUL ’24 649.75 2.5
K.C. Wheat
DEC ’23 728.25 5.5
MAR ’24 732.75 4.75
JUL ’24 723.5 5.5
Mpls Wheat
DEC ’23 766 6.25
MAR ’24 783.75 5.25
SEP ’24 792.5 5.5
S&P 500
DEC ’23 4563.25 -7.75
Crude Oil
NOV ’23 86.9 2.15
Gold
DEC ’23 1952.3 -14.8

  • Corn is trading higher and has rebounded from today’s earlier lows as the hot and dry weather over the weekend likely did further damage to the crop.

  • Later this afternoon, the Crop Progress report will be released, and most analysts expect the good to excellent rating to fall by 2-3 percentage points.

  • Basis bids for corn shipped by barge to the U.S. Gulf Coast were higher on Friday as the low Mississippi River water levels slow the flow of grain.

  • The Brazilian second crop corn harvest is nearing completion and record production is expected but planted acres of corn for 23/24 are expected to shrink.

  • While corn prices have recovered, soybeans have not and are trading lower along with both soybean meal and oil despite poor weather and another flash sale this morning.

  • Private exporters reported sales of 251,000 metric tons of soybeans for delivery to unknown destinations during the 2023/2024 marketing year.

  • Crude oil is trading sharply higher today after Saudi Arabia said that it would extend the voluntary cut of 1 million barrels per day until the end of the year. This should be supportive to soybean oil.

  • The Energy Department reported that a record 1.27 billion pounds of bean oil were consumed for biofuels which is up 49% from a year ago.

  • All three wheat products are trading higher today following a weekend attack on a Ukrainian port by Russia, and Putin announcing that he would not renew the grain deal after meeting with Turkey.

  • Russia booked a sale of wheat to Egypt in a private tender selling 480,000 mt over the weekend. Russia was passed over by Egypt for their previous two sales.

  • Russian exporters are reportedly offering wheat at $245-$250/mt FOB versus the recommended government floor level of $270/MT.

  • The Argentinian wheat crop has been struggling with dry conditions, but recent rainfall may have been enough to relieve the crop.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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Opening Update: September 5, 2023

ByGrain Market Insider

All prices as of 6:30 am Central Time

Corn

DEC ’23 482 0.5
MAR ’24 496.75 0.25
DEC ’24 509.75 0.25

Soybeans

NOV ’23 1363.75 -5.5
JAN ’24 1377 -5.75
NOV ’24 1288.75 -4.25

Chicago Wheat

DEC ’23 601.5 6
MAR ’24 627.75 5.75
JUL ’24 652.25 5

K.C. Wheat

DEC ’23 725.25 2.5
MAR ’24 730.5 2.5
JUL ’24 721.25 3.25

Mpls Wheat

DEC ’23 764.5 4.75
MAR ’24 782.25 3.75
SEP ’24 787 -7

S&P 500

DEC ’23 4560.75 -10.25

Crude Oil

NOV ’23 84.51 -0.24

Gold

DEC ’23 1955.9 -11.2

If you missed our latest strategy update, click here:  Grain Market Insider Strategy Update

  • Corn is trading unchanged this morning despite hot and dry conditions over the weekend with more dryness forecast over the next few days.

  • Corn that was looking more promising following rains in August is now looking poorer which may show up in decreased yields on the WASDE report.

  • In Brazil, 84% of their second crop corn has been harvested after rains delayed planting, but the moisture will be beneficial to the next round of planting.

  • Friday’s WASDE report showed funds buying back some of their net short positions by 18,787 contracts leaving them net short 87,348 contracts.

  • Soybeans are trading lower this morning along with both soybean meal and oil as markets in general struggle to find higher prices today.

  • The focus for the near term is next week’s WASDE report which will show revised yields, acreage, and ending stocks which could be reported at their lowest levels in 8 years.

  • Late Friday, NASS reported that 184.8 million bushels of soybeans were crushed in July which is 2% more than a year ago and the most on record for July.

  • Friday’s CFTC report showed funds buying 32,779 contracts of soybeans increasing their net long position to 90,985 contracts.

  • Wheat is trading mixed this morning with Chicago and Minneapolis higher but KC lower.

  • Early Sunday morning, Russia attacked the Ukrainian port of Reni, damaging warehouses and port infrastructure.

  • Russia’s fresh attack came one day before Putin met with the president of Turkey about reviving the grain deal, but Putin refused to renew citing a list of unmet demands.

  • Friday’s CFTC report showed funds adding to their net short position by 8,960 contracts increasing it to 79,881 contracts.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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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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Midday Update: 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 10:30 am Central Time

Corn
DEC ’23 483.25 5
MAR ’24 498.75 4.75
DEC ’24 510 2.5
Soybeans
NOV ’23 1367 -1.75
JAN ’24 1380.75 -1.25
NOV ’24 1296.25 3.5
Chicago Wheat
DEC ’23 607.5 5.5
MAR ’24 633.25 4.5
JUL ’24 657.25 2.75
K.C. Wheat
DEC ’23 739.5 12.25
MAR ’24 744 10.25
JUL ’24 732.5 8.75
Mpls Wheat
DEC ’23 771 4.25
MAR ’24 789.25 4.75
SEP ’24 794 -8.75
S&P 500
DEC ’23 4571.25 5.5
Crude Oil
NOV ’23 84.16 1.2
Gold
DEC ’23 1964 -1.9

  • Corn is trading higher at midday to start the month as heat and dryness remain in the forecast over the next 7 days and may threaten yields.

  • There were zero deliveries tendered against the September futures contracts.

  • September’s WASDE report may show reduced yield numbers but may also show increases in acreage, which could offset some of the production from yield loss.

  • US corn demand has picked up with export sales reported at 39 mb yesterday from 23/24 as the US has become competitive with Brazil.

  • Soybeans are relatively unchanged and have slipped from their earlier morning highs. Soybean meal is lower, while soybean oil is higher thanks to higher crude oil.

  • There were zero deliveries against September soybean futures and both soy products.

  • 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.

  • Barge rates are soaring to over 42% this year as water levels in the Mississippi River fall again with little rain forecast to help. Barge rates are currently 85% over the 3-year average.

  • All three wheat contracts are trading higher with KC leading the way to start the month. Contract lows were made yesterday as reports that the spring wheat harvest may reveal better yields than expected.

  • On Monday, Putin and Edrogan from Turkey are expected to meet to discuss renewing the Black Sea grain deal.

  • Ukraine has been using its own humanitarian corridor to export grains with two more vessels leaving the region earlier today.

  • Australia has been dealing with hot and dry weather which has seriously impacted yields lowering their wheat outlook. China is a key buyer for Australian wheat.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies. 

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Opening Update: September 1, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

DEC ’23 482.5 4.25
MAR ’24 497.75 3.75
DEC ’24 510 2.5

Soybeans

NOV ’23 1382.25 13.5
JAN ’24 1395.5 13.5
NOV ’24 1301.5 8.75

Chicago Wheat

DEC ’23 608.5 6.5
MAR ’24 635.25 6.5
JUL ’24 659.5 5

K.C. Wheat

DEC ’23 735.75 8.5
MAR ’24 741.25 7.5
JUL ’24 727.75 4

Mpls Wheat

DEC ’23 770.75 4
MAR ’24 785.75 1.25
SEP ’24 794 -8.75

S&P 500

DEC ’23 4582.25 16.5

Crude Oil

NOV ’23 83.96 1

Gold

DEC ’23 1971.5 5.6

If you missed our latest strategy update, click here:  Grain Market Insider Strategy Update

  • Corn is trading higher this morning as hot and dry weather threatens yields, but upcoming harvest has put a damper on prices.

  • Yesterday’s export sales numbers were solid and a good improvement with the US moving from a new crop sales deficit of over 125 mb to just under 60 mb.

  • September’s WASDE report may show reduced yield numbers but may also show increases in acreage which could offset some of the production from yield loss and still leave the US with a carryout above 2 billion bushels.

  • In Argentina, production estimates for corn have stayed steady at 34 mmt and harvest is now 98.9% complete.

  • Soybeans are trading higher this morning along with both soybean meal and oil. Crude oil is higher again today which has been supportive of bean oil.

  • While weather remains hot and dry, chances for rain have improved slightly for the next week but rainfall totals would still be low, and temperatures may not be as hot as expected.

  • US soybean offers for October through January are on par with Brazilian offers which has seen US exports pick up significantly over the past few weeks.

  • Barge rates are soaring to over 42% this year as water levels in the Mississippi River fall again with little rain forecast to help. Barge rates are currently 85% over the 3-year average.

  • Wheat is trading higher this morning along with corn and beans as contracts attempt to find a bottom where prices are more competitive globally.

  • With spring wheat yields coming in better than expected, Minn futures have had a hard time finding as much momentum as the Chicago contract which is already nearing competitive prices for exports.

  • The UN has sent Russia more bids to revive the Black Sea grain deal, but at this point it isn’t looking like they will rejoin unless unlikely demands are met.

  • Australia has been dealing with hot and dry weather which has seriously impacted yields lowering their wheat outlook. China is a key buyer for Australian wheat.

Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing by Stewart-Peterson and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Stewart-Peterson Inc. Reproduction of this information without prior written permission is prohibited. Hypothetical performance results have many inherent limitations. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown. The data contained herein is believed to be drawn from reliable sources but cannot be guaranteed. Reproduction and distribution of this information without prior written permission is prohibited. This material has been prepared by a sales or trading employee or agent of Total Farm Marketing and is, or is in the nature of, a solicitation. Any decisions you may make to buy, sell or hold a position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to Total Farm Marketing.

Stewart-Peterson Inc., Stewart-Peterson Group Inc., and SP Risk Services LLC are each part of the family of companies within Total Farm Marketing (TFM). Stewart-Peterson Inc. is a publishing company. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of National Futures Association. SP Risk Services LLC is an insurance agency. A customer may have relationships with any or all three companies.