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Opening Update: June 27, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

JUL ’23 628.5 -8.75
DEC ’23 569.75 -18.5
DEC ’24 529 -9.25

Soybeans

JUL ’23 1502.25 -18.75
NOV ’23 1288.25 -34.75
NOV ’24 1224.75 -25.5

Chicago Wheat

JUL ’23 702 -22.25
SEP ’23 716 -22.25
JUL ’24 752.5 -20

K.C. Wheat

JUL ’23 851.25 -15.25
SEP ’23 851.75 -16.5
JUL ’24 821.75 -8

Mpls Wheat

JUL ’23 855 -7.25
SEP ’23 863.25 -9.25
SEP ’24 825.5 5.5

S&P 500

SEP ’23 4377 6.75

Crude Oil

AUG ’23 68.41 -0.96

Gold

AUG ’23 1930.8 -3

  • Corn is trading sharply lower this morning despite yesterday’s poor crop progress results as weather patterns turn wetter.

  • In corn, good to excellent ratings fell 5% from the previous week and are now at just 50%. 4% of corn is silking which is in line with the 5 year average.

  • Rain forecasts overnight have changed to include SE Nebraska, southern Iowa, and southern Illinois, areas of the Corn Belt that have been in the most need of moisture.

  • The June acreage report will be released on Friday and is expected to show a small decrease in acres at 91.85 ma which would be down from 92 ma the previous month.

  • Soybeans and both soybean meal and oil are lower this morning along with corn, again despite poor crop ratings and thanks to improved weather forecasts.

  • Soybean’s good to excellent ratings fell by 3% to 51% which is the lowest rating for this time of year since 1988. Anticipated rains could bring the crop back to life.

  • Friday morning’s acreage report is expected to show soybean acres up slightly from May intentions with average trade guesses at 87.67 ma, up from 87.45 ma.

  • Yesterday’s soybean inspections were poor as Brazil keeps control of the export market with their cheaper soybeans.

  • Wheat is lower with the rest of the grain complex with Chicago futures leading the way as the wet forecast dominates today’s trade.

  • Winter wheat good to excellent ratings actually increased by 2% to 40%, but spring wheat fell by 1% to 50%. Winter wheat is now 24% harvested vs 15% last week.

  • While it is looking less and less likely that Russia will extend the Black Sea deal, markets appear uncaring and are focused on US weather.

  • Friday’s stocks report will estimate the final ending stocks of 22/23 and the average trade guess is 611 mb, down from 698 mb last year.

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: June 26, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Disappointing rainfall and the anticipation of lower crop ratings in this afternoon’s Crop Progress report kept the corn market on the positive side of unchanged for most of the day, while weak export inspections weighed on the market.

  • Gaining support from a lack of rain in some key soybean growing areas and a strong soybean oil market, soybeans closed the day higher with Old Crop leading New Crop.

  • Soybean oil continued its rally from last Thursday’s bullish reversal, with additional support from higher palm oil. As for soybean meal, it saw both sides of unchanged and up to $6.10 higher before settling back to close in the green by 60 cents.

  • Globally, central banks are hawkish and continue to talk about raising rates which could trigger a recession, lowering demand for food and energy.

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

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

Corn

Corn Action Plan Summary

  •  No new action is recommended for Old Crop.   Any remaining old crop bushels that you may have should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Corn — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities.  

  • No action is recommended for New Crop 2023 corn.  December corn rallied 139 cents from its May 18 low to its high on June 21 on weather and productions concerns. The market is currently about 40 cents off that high as traders book profits and liquidate long positions on poor export sales figures and a forecast that shows increased chances of rain in the next two weeks. The US Drought Monitor still shows drought conditions across much of the Midwest and it is estimated that 64% of the corn crop is experiencing some level of drought and is in desperate need of rain. If you missed getting any sales made or adding Dec 23 580 puts before today’s sharp break, for now we are looking at a level north of 610 as a catchup opportunity. 

  • Continue to hold current sales levels for the 2024 crop year.  The Dec 24 contract is trading weather much like the rest of the market and posted nearly an eighty-cent range between 5/18 and 6/21 as dry conditions affect the ’23 crop and the potential carryout for the 2024 crop year. We are currently eyeing the 670 – 700 level before we consider making additional sales recommendations for the 2024 crop. 

  • Corn futures finished the day mostly higher as prices tried to find a near-term bottom after last week’s disappointing end to the week. Corn futures were supported by overall weekend rainfall not hitting all key areas of the Corn Belt and the expectations of crop ratings slipping again this week.

  • The USDA will release weekly corn crop ratings on Monday afternoon. Expectations are for an additional drop to 52% good/excellent, down 3% from last week. The state of Illinois will stay as a focus of the market as rainfall missed many areas of the state and ratings were at 36% good/excellent last week, down 29% from the 5-year average.

  • Weekly corn export inspections were disappointing at 543,000 MT, and below market expectations. Year to date, corn inspections are still running 32% under last year’s pace.

  • Weather models in the longer term are trying to build a wetter forecast, which could limit market gains if realized. The key to all forecasts will be the coverage and location of rainfall.

  • The market may likely remain choppy as traders look to this Friday’s USDA Planted Acreage and Grain Stocks report.

Above: Weather is the dominant force for the corn market at this time. If the market can push through the 100-day moving average and the recent 625 high, it may be able to make a run for the March highs between 650 – 670. If not, support may be found between 580 and 540.

Above: Corn Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red. Money Managers net bought 56,154 contracts between June 13 – June 20, bringing their total position to a net long 58,299 contracts.

Soybeans

Soybeans Action Plan Summary

  • No new action is being recommended for Old Crop.  Any remaining old crop bushels should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Soybeans — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities. 

  • No action is being recommended for New Crop 2023 soybeans.  Changes in weather forecasts and crop conditions will continue to dominate the market. With having just recommended making a cash sale, and with one of the most volatile USDA report days of the year coming this Friday, we would need to see the market rally to 1400 – 1450 area before we would consider recommending any additional sales for the 2023 crop. Otherwise, in light of current crop conditions, we will suggest holding tight on further cash sales for now.

  • Continue to hold off on pricing the 2024 crop. We look to make sales further into the 2023 growing season when selling opportunities tend to improve seasonally. 

  • Soybeans closed higher today along with both soybean meal and oil after rainfall this weekend missed crucial dry regions including southern Illinois, and tensions within Russia grew which could affect veg oil exports.

  • Crop progress will be released shortly, and expectations are that good to excellent ratings will fall by another 3 to 4%, but the weekend rains may have helped limit the decline. Last week, Illinois’ rating fell by 14% to just 33% good to excellent.

  • Soybean oil was supportive for soybeans as palm oil rallied 2.65% today along with other veg oils. Palm oil supplies may end up being tight due to weather issues, and exports from other countries may be limited.

  • Soybean export inspections were poor for last week and could be a wet blanket over the market even with dry weather in the US. Inspections totaled 5.2 mb for 22/23 and put total inspections at 1.807 bb which is down 4% from the previous year.

Above: The market’s eye is squarely on the weather at this time. The August contract rallied through the 50-day moving average and hit resistance near 1450 and the 100-day moving average. If the market can rally beyond this point, the resistance area between 1500 and 1550 could be its next target. If the market drops back, support could be found between 1340 and 1300 with further support near 1270.

Above: Soybeans Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red.  Money Managers net bought 29,068 contracts between June 13 – June 20, bringing their total position to a net long 76,950 contracts.

Wheat

Market Notes: Wheat

  • News of a mutiny by a private Russian fighting group, the Wagner Group, against the Russian government may be tied to early strength in the wheat market. However, it is believed that some sort of deal was reached, because the group was no longer headed to Moscow, but instead back to Ukraine. This could explain why wheat faded into the close.

  • Weekly wheat inspections at 7.5 mb bring the total 23/24 inspections to 28 mb. This total is down 43% from this time last year.

  • Managed funds are still said to be net short about 84,000 contracts of Chicago wheat as of last Tuesday. This could lead to more of a short covering rally if there is a catalyst in the form of friendly news.

  • Russia will reportedly reduce their wheat export tax from 2,613 rubles per ton to 2,473, equivalent to roughly $31 vs $29 per ton. While not a huge move, the fact that they continue to dominate on the export front with low prices does not bode well for US exports and prices.

  • Paris milling wheat futures gapped higher on the open, likely due to the uncertainty of the Russia news. However, they finished with losses and closed the gap, offering no support to the US markets.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Grain Market Insider is done with the 2022 crop, and there will be no New Alerts posted for the 2022 crop going forward.

  • Grain Market Insider sees an active opportunity to sell 2023 New Crop.  We are in a weather market and with the US Drought Monitor showing dryness across the Midwest, September Chicago Wheat has now rallied about 22% from its May 31 low into the March – April resistance area and is overbought. As of late, the wheat market has largely been a follower of the corn market, and this rally has been fueled in part by the Funds exiting their short positions. While there are production concerns in parts of the country, demand has been weak, and the potential remains for a rising carryout. Any change to a more favorable weather forecast could easily erase much, if not all, of the weather premium that has been added to prices. With the dry conditions and great uncertainty that many of you are experiencing about how much you will have to harvest, we understand there’s hesitancy to sell anything here. If you are concerned about committing physical bushels with a cash sale, consider selling futures or buying put options.

  • Grain Market Insider sees an active opportunity to sell 2024 Chicago wheat.  Prices for the 2024 crop have largely followed prices for the 2023 crop and are currently about 20% above the low set on May 31. Weather and production concerns have been the primary driver of prices lately, and the funds have likely been covering short positions, further feeding the rally.  As we all know, weather markets can be fickle beasts, and any change in the forecast or crop conditions can quickly turn traders from buyers to sellers, quickly erasing much, if not all, of the premium priced into the market.  Grain Market Insider recommends making a sale on next year’s 2024 Chicago wheat crop and using either a July ’24 futures contract or a July 24 HTA contract so basis can be set at a later date, as it should improve in time.

Above: September wheat has had a strong run and is near the 200-day moving average around 750, which it hasn’t seen since last October.  Above there, resistance may be found between the psychological resistance point of 800 and 865.  With further resistance coming in between 900 – 950. Should prices turn lower, initial support may be found near 670 and then again near 611. 

Above: Chicago Wheat Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red. Money Managers net bought 29,296 contracts between June 13 – June 20, bringing their total position to a net short 84,134 contracts.

KC Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Though most, if not all, of your Old Crop 2022 wheat may be sold, consider storing any remaining Old Crop, if possible, in anticipation of a short new crop this year, and marketing it along with the new crop.

  • We continue to look for better prices before making any 2023 sales. While Crop ratings have improved and the Black Sea export corridor remains open, questions remain about the size of the HRW crop, whether Russia will continue to agree to keep the Black Sea corridor open, and what production looks like in Europe and Australia. We continue to target 950 – 1000 in the July futures as a potential level to suggest the next round of New Crop sales.

  • Patience is warranted for the 2024 crop. With continued issues in the Black Sea region and with major exporting countries’ stocks expected to fall to 16-year lows, we are willing to be patient with further sales of New Crop HRW wheat. We are targeting just below the 900 level on the upside while keeping an eye on recent lows for any violation of support.

Above: The market has been able to trade out of the recent congestion area to near the 200-day moving average and into the 870 – 920 resistance area. If the market can push through, 970 – 1000 is the next major point of resistance. If it falls back, initial support could be near 825 with further support between 778 and 764. 

Above: K.C. Wheat Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red. Money Managers net bought 2,328 contracts between June 13 – 20, bringing their total position to a net long 5,944 contracts.

Mpls Wheat Action Plan Summary

  • No new action for 2022 Old Crop MINNEAPOLIS Wheat. Prices haven’t moved much over the last couple of weeks, and it’s disappointing to see the lack of upside opportunities that the market has offered following the large snowfall and the late start to planting this spring. Yet, the marketing year for Old Crop is quickly winding down, and any additional upside opportunities may be more difficult to come by before New Crop harvest, especially given record European wheat shipments and falling Russian prices. Also, we typically recommend finishing up sales on any remaining Old Crop bushels by mid-June, as bids will soon shift from the July to September contract, and there is currently no carry offered.

  • K.C. Wheat Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red. Money Managers net bought 2,328 contracts between June 13 – 20, bringing their total position to a net long 5,944 contracts.

  • We continue to hold on pricing the 2024 crop. With the September ‘24 contract about 60 cents from its May 22 low, continued issues in the Black Sea region and major exporting countries’ stocks expected to fall to 16-year lows, we are entering the time frame where we would consider suggesting making sales recommendations while also keeping an eye on the recent lows for any violation of support. 

Above: The September contract has rallied out of its congestion area on the Front Month Continuous chart towards the 200-day moving average. Resistance may be found above the market between 889 and 940, the April and December highs respectively.  While the upside breakout is a positive sign, the market will need additional bullish news to keep it moving. Should the market reverse course and turn lower, support below the market may be found between 770 and 760. 

Above: Minneapolis Wheat Managed Money Funds net position as of Tuesday, June 20. Net position in Green versus price in Red. Money Managers net bought 4,160 contracts between June 13 – June 20, bringing their total position to a net short 3,262 contracts. 

Other Charts / Weather

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Midday Update June 26, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 636.75 6
DEC ’23 586.75 -1.25
DEC ’24 535.25 2
Soybeans
JUL ’23 1509 14.5
NOV ’23 1315.5 5.5
NOV ’24 1241 0
Chicago Wheat
JUL ’23 728.75 -4.5
SEP ’23 742.75 -3.75
JUL ’24 770 -0.5
K.C. Wheat
JUL ’23 863 4
SEP ’23 863.5 1.75
JUL ’24 821.25 -3.25
Mpls Wheat
JUL ’23 861.25 -3.5
SEP ’23 871 -2.75
SEP ’24 827.25 7.25
S&P 500
SEP ’23 4381.5 -7.5
Crude Oil
AUG ’23 69.05 -0.11
Gold
AUG ’23 1937.2 7.6

  • Over the weekend, there was good rain in the Dakotas and parts of the northern Midwest. However, several key growing regions appeared to get little to none of this moisture.

  • The 8-14 day forecast does have above-normal precipitation for the whole Corn Belt. But the key will be whether or not it materializes. 

  • CFTC data showed that funds were buyers of 140,000 grain contracts (corn / soy complex / wheat) as of last Tuesday. This now puts them net long corn (as well as soybeans).

  • This afternoon’s Crop Progress report is expected to show another decline in corn crop ratings. Traders look for a 2%-4% reduction in the good to excellent category.

  • As of June 17th, CONAB said 5.3% of Brazil’s second crop (safrinha) corn had been harvested. This is 5.8% behind last year’s pace.

  • Higher palm oil overnight is supporting soybean oil, which has reversed off of last week’s low. With both oil and meal higher at midday, soybeans are receiving a boost as well.

  • There are concerns about vegetable oil exports out of Ukraine, with uncertainties surrounding the Russian coup, as well as the potential closure of the Black Sea export corridor in July. This may also be supporting soybean oil.

  • This afternoon’s Crop Progress report is expected to show another decline in soybean crop ratings. Traders look for a 3%-4% reduction in the good to excellent category.

  • India’s oilseed exports are anticipated to increase by 10%-15% this fiscal year due to expanding acreage. For 22/23, their oilseed exports rose by 20%. There is still a question, however, as to what effect El Nino may have on the crop down the road.

  • Strength in the wheat market this morning may be tied to a mutiny by the Wagner group against Russia. However, at this time, it appears they may have made a deal, because the group heading towards Moscow has since turned around and went back to Ukraine. This does still raise questions about the war, and ultimately, what it will mean for wheat exports.

  • Managed funds are still net short Chicago wheat. With the uncertainty of global weather and geopolitics, the market may also be seeing some short covering today.

  • Matif wheat gapped higher on the open, likely for the same reasons mentioned above. In any case, this is also supportive to US futures. This is also despite the fact that some rains hit the dry areas of northern Europe over the weekend.

  • There is still question as to how much Chinese wheat was damaged or downgraded due to the heavy rainfall a few weeks ago.

  • Russia’s wheat export tax will reportedly be reduced from 2,613 rubles (per ton) to 2,473 rubles, according to their agriculture ministry.

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: June 26, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

JUL ’23 634 3.25
DEC ’23 587.75 -0.25
DEC ’24 535.5 2.25

Soybeans

JUL ’23 1501.25 6.75
NOV ’23 1320.5 10.5
NOV ’24 1245 4

Chicago Wheat

JUL ’23 752 18.75
SEP ’23 765.25 18.75
JUL ’24 783 12.5

K.C. Wheat

JUL ’23 878 19
SEP ’23 879.25 17.5
JUL ’24 840 15.5

Mpls Wheat

JUL ’23 876.5 11.75
SEP ’23 886.75 13
SEP ’24 820 0

S&P 500

SEP ’23 4383.75 -5.25

Crude Oil

AUG ’23 69.56 0.4

Gold

AUG ’23 1942 12.4

  • July corn is trading slightly higher while the deferred contracts are lower following weekend rains and beginning and end of a military coup in Russia.

  • This weekend, beneficial rains fell in a good portion of Iowa and Indiana, but only covered the Northern portion of Illinois.

  • The 7-day forecast shows wide coverage over the Corn Belt, but those rains are slated to fall over the weekend again which is still a ways off and will need to materialize.

  • Funds were net buyers of corn last week increasing their net long position by 56,000 contracts to 58,000 contracts.

  • Soybeans are trading higher this morning along with both soybean meal and soybean oil due to worries about veg oil exports from Ukraine being closed off.

  • As soybean conditions worsen in the US and drive domestic prices higher, it has also had an effect on global markets with Brazilian prices rising as well.

  • India’s oilseed exports are expected to grow by 10 to 15% this year as orders from southeast Asia, Latin America, and Africa increase.

  • Funds were net buyers of soybeans last week and their net long position was increased to 77,000 contracts.

  • Wheat is trading higher this morning after the Wagner group in Russia began a military coup this weekend and marched towards Moscow, but once they were a few hours from the city, the leader agreed to leave for Belarus in exchange for charges being dropped against him.

  • The begin and end of this insurrection combined with the apparent end of the Ukrainian grain deal next month has been supportive of prices.

  • China has been experiencing excess rainfall in their wheat growing regions which has been another bullish factor.

  • Funds were buyers of wheat last week by 29,296 contracts, reducing their net short position to 84,134 contracts, still a very short position.

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: June 23, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Follow through selling and long liquidation with disappointing export sales weighed heavily on the corn market as traders took profits ahead of the weekend.

  • A shift in the weather forecast for the better across the “I” states of the Midwest, along with a 4% drop in soybean meal, added pressure to the soybean market as traders liquidated long positions from this week’s rally ahead of the weekend.

  • Soybean oil was the strong leg of the bean complex as it found follow through buying from yesterday’s bullish reversal and a stronger palm oil market.

  • All three wheat markets trade lower as spillover weakness from corn and soybeans weigh on prices and traders take profits from the recent rally.

  • To fight inflation, European central banks are raising interest rates, and there are growing concerns that this could put us into a global recession, reducing demand for food and energy.

  • To see the current US NOAA 7 – day US Precipitation Outlook and the US NOAA 8 – 14 day Precipitation and Temperature Outlooks scroll down to the Other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  •  No new action is recommended for Old Crop. Any remaining old crop bushels that you may have should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Corn — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities.  

  • Grain Market Insider recommends buying Dec 23 580 corn puts today for about 30 cents in premium plus commission and fees. Additionally, Grain Market Insider sees an active opportunity to sell New Crop 2023 corn. With the Dec 23 contract trading at the upper end of our 590 – 630 target range, Insider recommends buying December puts today to add downside coverage on New Crop in case prices move significantly lower. Despite the ongoing drought concerns, we still have confidence to continue to recommend selling into this rally as the Dec 23 610 Call options have been in place since May 2nd. On May 2nd, Insider recommended buying 560 and 610 Dec calls, and then recommended exiting the 560s on June 2nd once the 560 calls had gained enough in value to offset the cost of the 610 calls. Owning both calls and puts can be very beneficial in a market as volatile as this. If it doesn’t rain, and Dec corn continues to rally, the 610 calls will continue to gain in value and protect your new sale.  Meanwhile, buying puts will allow you to protect the downside on more bushels without committing to a sale when your production may be uncertain. For now, the market is strong, though demand remains sluggish, and with Brazil beginning to harvest another possible record crop, both domestic and world carryout figures could potentially rise further.  Any change to a more favorable weather forecast could easily turn the market lower and erase much, if not all, of the 125 cent rally from the May 19th low. 

  • Continue to hold current sales levels for the 2024 crop year. Much like the Dec 23 contract, the Dec 24 contract has rallied significantly from the May 18 lows as the market prices in possible crop reductions that could carry over into the 2024 crop year. Be watchful, as we are, entering into the time frame where we would consider suggesting making additional sales recommendations for the 2024 crop year. 

  • The corn market traded down in excess of 5% with traders booking profits ahead of the weekend on disappointing export sales and forecasts call for rain next week across the “I” states.

  • Forecasts for rain across the Midwest dominated the trade with the longer range 6 – 10 and 8 – 14 day outlooks shifting to more normal to above normal precipitation patterns, while the 7-day forecast has rain favoring the northern Midwest with less in MO, central IL and IN.

  • US export sales came in at a disappointing 36k tons for Old Crop versus 272k last week, well below the 470k tons in sales needed each week to reach the USDA’s goal. As for New Crop sales, the USDA reported 47k tons sold.

  • Further hampering US export sales, Brazilian offers continue to be $30 – $40 per ton cheaper than the US as they continue to harvest their large second (safrinha) corn crop.

  • It’s estimated with the latest run of the US Drought Monitor, that 64% of the corn crop is in areas with some level of drought, which includes 82% of Illinois and 83% of Iowa.

Above: Weather is the dominant force for the corn market at this time.  If the market can push through the 100-day moving average and the recent 625 high, it may be able to make a run for the March highs between 650 – 670.  If not, support may be found between 580 and 540.

Soybeans

Soybeans Action Plan Summary

  • No new action is being recommended for Old Crop. Any remaining old crop bushels should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Soybeans — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities. 

  • Grain Market Insider sees an active opportunity to sell New Crop 2023 soybeans. Grain Market Insider sees an active opportunity to sell New Crop 2023 soybeans.  November soybeans have rallied over 200 cents from the May 31st low and hit the upper end of our 1300 to 1350 target range. With the November contract a little bit over the upper end of this range, an Active sales opportunity continues to get some New Crop priced.  KC Wheat has demonstrated that domestic drought conditions do not necessarily guarantee higher domestic prices if global supplies are ample. US wheat country has been extremely dry for many months, yet prices are about even with where prices were in late 2021, before Russia invaded Ukraine. Global soybean supplies could be record large, and this could be a rally risk factor.

  • Continue to hold off on pricing the 2024 crop. We look to make sales further into the 2023 growing season when selling opportunities tend to improve seasonally. 

  • Soybeans closed lower today with New Crop leading the way lower and July only down slightly.Soybean meal closed sharply lower, while soybean oil moved higher thanks to a jump in palm oil of 1.7% today.

  • Changes in the weather forecast have pressured both corn and soybeans with the 7-day forecast from NOAA showing an accumulated 0.5 to 1.5 inches of rain over the next week in the very dry areas of Iowa, Illinois, and Indiana.

  • Export sales were better this week at 16.8 mb for 22/23 and increases of 6.2 mb for 23/24. Last week’s export shipments of 14.2 mb were better than expected and above the 11.7 mb needed each week to meet the USDA’s expectations.

  • Next week, crop progress will be released, and conditions could decline after this week’s dryness. If weekend rains come through, conditions could remain steady with last week.

Above: The market’s eye is squarely on the weather at this time.  The August contract rallied through the 50-day moving average and hit resistance near 1450 and the 100-day moving average. If the market can rally beyond this point, the resistance area between 1500 and 1550 could be its next target. If the market drops back, support could be found between 1340 and 1300 with further support near 1270.

Wheat

Market Notes: Wheat

  • The USDA reported an increase of 4.0 mb of wheat export sales for 23/24, and an increase of 0.5 mb for 24/25. The figures for corn and soybeans were not much better and may have contributed to today’s weakness.

  • Several other factors are likely weighing on markets today – weather being number one. With both the American and European models putting rain in the forecast mid to late next week for the Midwest, wheat followed corn and soybeans lower today. Other factors may be profit taking, as well as the recent interest rate increases by European banks, which are causing renewed concern about recession.  

  • US futures received no support from Matif wheat, which traded lower today. Matif wheat is also overbought on daily stochastics and is showing potential sell signals, painting a weak technical picture despite the fact that French wheat conditions have declined for four weeks in a row.

  • Position squaring before month end could be playing into the grain complex trade as well. With the recent strong rally and the June 30 Stocks and Acreage reports due for release next week, traders may be taking profit ahead of uncertain results.

  • Russia has essentially said they are unwilling to extend the Black Sea grain deal beyond the July 18th deadline. This does not seem to be impacting the market much, however, perhaps because traders have heard this story before.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Grain Market Insider is done with the 2022 crop, and there will be no New Alerts posted for the 2022 crop going forward.

  • Grain Market Insider sees an active opportunity to sell 2023 New Crop. We are in a weather market and with the US Drought Monitor showing dryness across the Midwest, September Chicago Wheat has now rallied about 22% from its May 31 low into the March – April resistance area and is overbought.  As of late, the wheat market has largely been a follower of the corn market, and this rally has been fueled in part by the Funds exiting their short positions. While there are production concerns in parts of the country, demand has been weak, and the potential remains for a rising carryout. Any change to a more favorable weather forecast could easily erase much, if not all, of the weather premium that has been added to prices.  With the dry conditions and great uncertainty that many of you are experiencing, about how much you will have to harvest, we understand there’s hesitancy to sell anything here.  If you are concerned about committing physical bushels with a cash sale, consider selling futures or buying put options.

  • Grain Market Insider sees an active opportunity to sell 2024 Chicago wheat. Prices for the 2024 crop have largely followed prices for the 2023 crop and are currently about 20% above the low set on May 31. Weather and production concerns have been the primary driver of prices lately, and the funds have likely been covering short positions, further feeding the rally. As we all know, weather markets can be fickle beasts, and any change in the forecast or crop conditions can quickly turn traders from buyers to sellers, quickly erasing much, if not all, of the premium priced into the market. Grain Market Insider recommends making a sale on next year’s 2024 Chicago wheat crop and using either a July ’24 futures contract or a July 24 HTA contract so basis can be set at a later date, as it should improve in time.

Above: September wheat has had a strong run and is near the 200-day moving average around 750, which it hasn’t seen since last October.  Above there, resistance may be found between the psychological resistance point of 800 and 865.  With further resistance coming in between 900 – 950.  Should prices turn lower, initial support may be found near 670 and then again near 611.

KC Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Though most, if not all, of your Old Crop 2022 wheat may be sold, consider storing any remaining Old Crop, if possible, in anticipation of a short new crop this year, and marketing it along with the new crop.

  • We continue to look for better prices before making any 2023 sales. While Crop ratings have improved and the Black Sea export corridor remains open, questions remain about the size of the HRW crop, whether Russia will continue to agree to keep the Black Sea corridor open, and what production looks like in Europe and Australia. We continue to target 950 – 1000 in the July futures as a potential level to suggest the next round of New Crop sales.

  • Patience is warranted for the 2024 crop. With continued issues in the Black Sea region and with major exporting countries’ stocks expected to fall to 16-year lows, we are willing to be patient with further sales of New Crop HRW wheat. We are targeting just below the 900 level on the upside while keeping an eye on recent lows for any violation of support.

Above: The market has been able to trade out of the recent congestion area to near the 200-day moving average and into the 870 – 920 resistance area. If the market can push through, 970 – 1000 is the next major point of resistance.  If it falls back, initial support could be near 825 with further support between 778 and 764. 

Mpls Wheat Action Plan Summary

  • No new action for 2022 Old Crop MINNEAPOLIS Wheat. Prices haven’t moved much over the last couple of weeks, and it’s disappointing to see the lack of upside opportunities that the market has offered following the large snowfall and the late start to planting this spring. Yet, the marketing year for Old Crop is quickly winding down, and any additional upside opportunities may be more difficult to come by before New Crop harvest, especially given record European wheat shipments and falling Russian prices. Also, we typically recommend finishing up sales on any remaining Old Crop bushels by mid-June, as bids will soon shift from the July to September contract, and there is currently no carry offered.

  • No action is recommended on the 2023 crop at this time. The September ’23 contract had a 120-cent range in the month of May where it found support just above 770. While the planting has largely been completed, dryness in some areas is increasing. With a full growing season ahead of us, we are not looking to make any sales right now. (Updated 6/22)

  • We continue to hold on pricing the 2024 crop. With the September ‘24 contract about 60 cents from its May 22 low, continued issues in the Black Sea region and major exporting countries’ stocks expected to fall to 16-year lows, we are entering the time frame where we would consider suggesting making sales recommendations while also keeping an eye on the recent lows for any violation of support. 

Above: The September contract has rallied out of its congestion area on the Front Month Continuous chart towards the 200-day moving average. Resistance may be found above the market between 889 and 940, the April and December highs respectively.  While the upside breakout is a positive sign, the market will need additional bullish news to keep it moving. Should the market reverse course and turn lower, support below the market may be found between 770 and 760. 

Other Charts / Weather

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Midday Update June 23, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 634.25 -26.25
DEC ’23 589.75 -31
DEC ’24 538 -17.75
Soybeans
JUL ’23 1492.25 -8.25
NOV ’23 1305.5 -34
NOV ’24 1234.25 -14.75
Chicago Wheat
JUL ’23 728.5 -10.5
SEP ’23 742 -10.75
JUL ’24 766 -14.25
K.C. Wheat
JUL ’23 859 -12
SEP ’23 862.5 -10
JUL ’24 820.5 -20.75
Mpls Wheat
JUL ’23 874.25 -5.75
SEP ’23 880.75 -3.75
SEP ’24 813 -8
S&P 500
SEP ’23 4388.75 -35
Crude Oil
AUG ’23 68.66 -0.85
Gold
AUG ’23 1933.3 9.6

  • Corn is trading sharply lower after weather models overnight shifted to push rain into Iowa, Illinois, and Indiana over the weekend.

  • Both the 6–10-day forecast, and 8-14 day are now showing above average precipitation, as well as normal temperatures, which would bring milder and wetter conditions into July.

  • While corn is down significantly, it did find support at the 200-day moving average and bounced off of it to a few cents higher.

  • Between June and July in 2012, the USDA lowered corn yield by 20 bu. and if it were to happen this year, there are concerns that it would put yield below 170 and take nearly 1 billion bushels from this year’s production.

  • Soybeans are trading lower with losses primarily in the deferred contracts as soybean meal falls over 4% in the Dec contract, but soybean oil recovers slightly despite losses in crude oil.

  • New crop soybeans have fallen over 72 cents in the past two days from Wednesday’s high after funds began profit taking and weather forecasts have changed to be wetter over the next two weeks.

  • Palm oil rose by 1.74% today, which has given some support to soybean oil after its sharp selloff due to the EPA biofuel mandate.

  • The weekly drought monitor has shown that 57% of the soybean crop is now considered to be in drought, and in 2012, that number was 43% this time of year, but new forecasts are showing more promise for rain in July.

  • Wheat has been following movements in corn and, therefore, is lower today as wetter forecasts pressure corn futures.

  • The Russian wheat crop has also been cut by 1.2 mmt for 2023 due to dry conditions in main growing regions and poor soil moisture.

  • India’s wheat output for 2023 is at least 10% lower than the government’s estimate, which has caused a sharp increase in local prices over the past 2 months.

  • It is now appearing very unlikely that Russia will renew the Black Sea grain deal on July 18 unless their demands are met. Recently, news out of the Black Sea region has not had much influence on the markets.

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: June 23, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

JUL ’23 646.25 -14.25
DEC ’23 606.25 -14.5
DEC ’24 549.5 -6.25

Soybeans

JUL ’23 1479.75 -20.75
NOV ’23 1319 -20.5
NOV ’24 1239.5 -9.5

Chicago Wheat

JUL ’23 729.5 -9.5
SEP ’23 743.5 -9.25
JUL ’24 767.75 -12.5

K.C. Wheat

JUL ’23 859.75 -11.25
SEP ’23 863 -9.5
JUL ’24 829 -12.25

Mpls Wheat

JUL ’23 872.75 -7.25
SEP ’23 879 -5.5
SEP ’24 821 4.75

S&P 500

SEP ’23 4405.25 -18.5

Crude Oil

AUG ’23 68.66 -0.85

Gold

AUG ’23 1929 5.3

  • Corn is trading lower this morning as weather models have turned slightly wetter for the driest parts of Illinois and Iowa this weekend.

  • Illinois is currently the most in need of rain out of the bunch, but wide coverage will be needed and so far weekend rains have been spotty.

  • Argentina’s corn forecast has been cut by 5.5% due to poor yields after drought, and analysts have cut estimated production by 2 mmt to 34 mmt.

  • According to NOAA, US corn crops in drought areas have jumped to 64%, up 7% from the previous week.

  • Soybeans are trading lower this morning pulled lower by soybean meal while soybean oil trades slightly higher in the front months.

  • Wetter weather models have put pressure on soybeans, but the release of the Renewable Fuel Standard blending mandates was very negative for soybean oil and has dragged down the complex.

  • Estimates for soybean export sales are showing an average of 506k, but could be as low as 300k.

  • Forecasts for the Corn Belt over the next 6-10 days are showing above normal rain and near normal temperatures which could continue to put pressure on corn and soybeans.

  • Wheat is trading lower this morning as it follows moves in corn and has also met some technical resistance after being overbought.

  • There has been excess rainfall delaying harvest in Texas and Oklahoma and early yield results have not been very good so far.

  • The UN’s FAO is launching a program to clear mines from Ukrainian land so that small farms and rural families will be able to grow food.

  • France has begun harvesting its wheat crop and rain is forecast to improve in central France while remaining dry in northwestern France.

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: June 22, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Profit taking from extremely overbought conditions weigh on the corn market as traders move long positions out of the nearby contract and into the deferred contracts.

  • Soybean meal, which was down 3.5%, led soybeans lower as traders booked profits from a radically overbought market.

  • Soybean oil, on the other hand, was able to shake off its losses and rally 240 points from the low to close .10 cents higher despite yesterday’s disappointing EPA mandate numbers.

  • Further short covering in the Chicago contracts and concerns that India’s wheat crop may be much smaller than anticipated helped buoy all three classes to a positive close save for July K.C., which likely saw traders move long positions to the September contract.

  • Possibly adding pressure to the markets today was the US dollar, as it traded higher today, likely in response to Fed Chairman Jerome Powell’s comments yesterday stating that more rate hikes are likely to fight inflation.

  • To see the current US NOAA 7 – day US Precipitation Outlook and US Drought Monitor scroll down to the Other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  •  No new action is recommended for Old Crop. Any remaining old crop bushels that you may have should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Corn — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities.  

  • Grain Market Insider recommends buying Dec 23 580 corn puts today for about 30 cents in premium plus commission and fees. Additionally, Grain Market Insider sees an active opportunity to sell New Crop 2023 corn. With the Dec 23 contract trading at the upper end of our 590 – 630 target range, Insider recommends buying December puts today to add downside coverage on New Crop in case prices move significantly lower. Despite the ongoing drought concerns, we still have confidence to continue to recommend selling into this rally as the Dec 23 610 Call options have been in place since May 2nd. On May 2nd, Insider recommended buying 560 and 610 Dec calls, and then recommended exiting the 560s on June 2nd once the 560 calls had gained enough in value to offset the cost of the 610 calls. Owning both calls and puts can be very beneficial in a market as volatile as this. If it doesn’t rain, and Dec corn continues to rally, the 610 calls will continue to gain in value and protect your new sale.  Meanwhile, buying puts will allow you to protect the downside on more bushels without committing to a sale when your production may be uncertain. For now, the market is strong, though demand remains sluggish, and with Brazil beginning to harvest another possible record crop, both domestic and world carryout figures could potentially rise further.  Any change to a more favorable weather forecast could easily turn the market lower and erase much, if not all, of the 125 cent rally from the May 19th low. 

  • Continue to hold current sales levels for the 2024 crop year. Much like the Dec 23 contract, the Dec 24 contract has rallied significantly from the May 18 lows as the market prices in possible crop reductions that could carry over into the 2024 crop year. Be watchful, as we are, entering into the time frame where we would consider suggesting making additional sales recommendations for the 2024 crop year. 

Grain Market Insider Corn open positions listed above.

  • Profit taking on extremely overbought conditions and a sharply lower soybean market weighed down corn futures, as the July contract led the New Crop contracts lower as traders moved long July positions to the September contract.

  • The European weather model shows 10 days of mostly dry weather for the Midwest, primarily in Il, E IA, IN, and parts of MO and S WI. Whereas the US model has rain in 8-10 day forecast, but some think it may be overdone. 

  • The latest US Drought Monitor shows deepening drought in the Dakotas and much of the North and Central Midwest, where conditions haven’t been this poor since 1988.

  • Between June and July in 2012, the USDA lowered corn yield by 20 bu. and if it were to happen this year, there are concerns that it would put yield below 170 and take nearly 1 billion bushels from this year’s production.

  • Last week’s ethanol production numbers were released today and showed an increase to 1.052k barrels/day, up from 1.018k barrels/day the week prior. While the increase in production is positive, the pace still falls below what is needed to reach the USDA’s estimate.

  • Brazil’s safrinha corn harvest is well underway and continues to weigh on the country’s domestic basis, potentially further slowing US exports with cheaper export prices than US offers.

Above: The corn market continues to run on weather concerns, and the September contract is above the 50-day moving average and knocking on the door of 100-day moving average and the recent 625 high. If the market can push through that level, it may be able to make a run for the 650 – 670 resistance level around the March highs. If not, support may be found between 580 and 540.

Soybeans

Soybeans Action Plan Summary

  • No new action is being recommended for Old Crop. Any remaining old crop bushels should be getting priced into this rally. We won’t have any “New Alerts” for 2022 Soybeans — either Cash, Calls, or Puts, as we have moved focus onto 2023 and 2024 Crop Year Opportunities. 

  • Grain Market Insider sees an active opportunity to sell New Crop 2023 soybeans. Grain Market Insider sees an active opportunity to sell New Crop 2023 soybeans.  November soybeans have rallied over 200 cents from the May 31st low and hit the upper end of our 1300 to 1350 target range. With the November contract a little bit over the upper end of this range, an Active sales opportunity continues to get some New Crop priced.  KC Wheat has demonstrated that domestic drought conditions do not necessarily guarantee higher domestic prices if global supplies are ample. US wheat country has been extremely dry for many months, yet prices are about even with where prices were in late 2021, before Russia invaded Ukraine. Global soybean supplies could be record large, and this could be a rally risk factor.

  • Continue to hold off on pricing the 2024 crop. We look to make sales further into the 2023 growing season when selling opportunities tend to improve seasonally. 

  • Soybeans closed sharply lower, led down by new crop as soybean meal lost over 3.5% in the August contract, while soybean oil recovered at the end of the day for a positive close.

  • The entire soy complex was volatile today after soybean oil closed limit down yesterday causing all three soy products to have expanded limits today. Soybean oil was driven lower by the EPA announcement regarding biofuel mandates.

  • Forecasts for the Corn Belt are still very dry for the next seven days, but Iowa is now expected to receive slightly more rain, while Illinois and Indiana are expected to remain dry.

  • While the EPA’s targets for advanced biofuels were below industry hopes, they do allow some growth of renewable diesel production, but not as much as expansion plans already proposed.

Above: The market’s eye is squarely on the weather at this time. The August contract has rallied through the 50-day moving average, approaching the 1450 resistance area and the 100-day ma. If the market can rally beyond this point, the resistance area between 1500 and 1550 could be its next target.  If the market drops back, support could be found between 1340 and 1300 with further support near 1270.

Wheat

Market Notes: Wheat

  • After trading on both sides of unchanged, all three US wheat classes closed higher with the exception of July K.C. wheat.

  • Private estimates of India’s wheat crop are 10% below their government’s estimate, and if this is correct, it could mean that India will need to import wheat.

  • As a reminder, July grain option expiration is tomorrow, and first notice date for July grain futures next Friday. With the funds still believed to be net short wheat, this could lead to some spread trading if they roll out of July and into deferred contracts.

  • The heavy rain in China’s wheat growing region is still expected to result in quality downgrades, and more wheat to be used for feed.

  • Sov Econ reduced their Russian wheat crop projection to 86.8 mmt vs 88.0 mmt previously because of hot and dry weather.  

  • Due to the shortened week, export sales data is delayed until tomorrow, but is likely to continue to show disappointing numbers for wheat, since Russia continues to dominate on the export front.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Grain Market Insider is done with the 2022 crop, and there will be no New Alerts posted for the 2022 crop going forward.

  • Grain Market Insider sees an active opportunity to sell 2023 New Crop. We are in a weather market and with the US Drought Monitor showing dryness across the Midwest, September Chicago Wheat has now rallied about 22% from its May 31 low into the March – April resistance area and is overbought.  As of late, the wheat market has largely been a follower of the corn market, and this rally has been fueled in part by the Funds exiting their short positions. While there are production concerns in parts of the country, demand has been weak, and the potential remains for a rising carryout. Any change to a more favorable weather forecast could easily erase much, if not all, of the weather premium that has been added to prices.  With the dry conditions and great uncertainty that many of you are experiencing, about how much you will have to harvest, we understand there’s hesitancy to sell anything here.  If you are concerned about committing physical bushels with a cash sale, consider selling futures or buying put options.

  • Grain Market Insider sees an active opportunity to sell 2024 Chicago wheat. Prices for the 2024 crop have largely followed prices for the 2023 crop and are currently about 20% above the low set on May 31. Weather and production concerns have been the primary driver of prices lately, and the funds have likely been covering short positions, further feeding the rally. As we all know, weather markets can be fickle beasts, and any change in the forecast or crop conditions can quickly turn traders from buyers to sellers, quickly erasing much, if not all, of the premium priced into the market. Grain Market Insider recommends making a sale on next year’s 2024 Chicago wheat crop and using either a July ’24 futures contract or a July 24 HTA contract so basis can be set at a later date, as it should improve in time.

Above: September wheat has had a strong run and is nearing the 200-day moving average around 750, which it hasn’t seen since last October.  Above there, resistance may be found between the psychological resistance point of 800 and 865.  With further resistance coming in between 900 – 950.  Should prices turn lower, initial support may be found near 670 and then again near 611. 

KC Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. Though most, if not all, of your Old Crop 2022 wheat may be sold, consider storing any remaining Old Crop, if possible, in anticipation of a short new crop this year, and marketing it along with the new crop.

  • We continue to look for better prices before making any 2023 sales. While Crop ratings have improved and the Black Sea export corridor remains open, questions remain about the size of the HRW crop, whether Russia will continue to agree to keep the Black Sea corridor open, and what production looks like in Europe and Australia. We continue to target 950 – 1000 in the July futures as a potential level to suggest the next round of New Crop sales.

  • Patience is warranted for the 2024 crop. With continued issues in the Black Sea region and with major exporting countries’ stocks expected to fall to 16-year lows, we are willing to be patient with further sales of New Crop HRW wheat. We are targeting just below the 900 level on the upside while keeping an eye on recent lows for any violation of support.

Above: The market has been able to trade above the recent resistance area and is near the 200-day moving average and 870 resistance. If the market can push through, 920 is the next major point of resistance. If it falls back, initial support could be near 825 with further support between 778 and 764.

Mpls Wheat Action Plan Summary

  • No new action for 2022 Old Crop MINNEAPOLIS Wheat. Prices haven’t moved much over the last couple of weeks, and it’s disappointing to see the lack of upside opportunities that the market has offered following the large snowfall and the late start to planting this spring. Yet, the marketing year for Old Crop is quickly winding down, and any additional upside opportunities may be more difficult to come by before New Crop harvest, especially given record European wheat shipments and falling Russian prices. Also, we typically recommend finishing up sales on any remaining Old Crop bushels by mid-June, as bids will soon shift from the July to September contract, and there is currently no carry offered.

  • No action is recommended on the 2023 crop at this time. The September ’23 contract had a 120-cent range in the month of May where it found support just above 770. While the planting has largely been completed, dryness in some areas is increasing. With a full growing season ahead of us, we are not looking to make any sales right now. (Updated 6/22)

  • We continue to be patient to market any of the 2024 crop. The market for the 2024 crop continues to be illiquid, and it may be early summer before we post any recommendations, continue to be patient.

Above: The market has rolled from the July to the September contract and has rallied out of its congestion area on the Front Month Continuous chart into the May highs. Further resistance above the market may be between 889 and 940, the April and December highs respectively. While the upside breakout is a positive sign, the market will need additional bullish news to keep it moving. Should the market reverse course and turn lower, support below the market may be found between 770 and 760.

Other Charts / Weather

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Midday Update June 22, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 656.5 -14.5
DEC ’23 617.25 -11.5
DEC ’24 555.25 -9.25
Soybeans
JUL ’23 1472.5 -42.25
NOV ’23 1326.5 -50.5
NOV ’24 1237.25 -18.75
Chicago Wheat
JUL ’23 732.75 -1.75
SEP ’23 746.5 -1.75
K.C. Wheat
JUL ’23 874.25 0.5
SEP ’23 873 1
JUL ’24 833 -2.75
Mpls Wheat
JUL ’23 875.75 -3
SEP ’23 879.25 -2.5
SEP ’24 829 12.75
S&P 500
SEP ’23 4409.25 0
Crude Oil
AUG ’23 69.91 -2.62

  • Corn is trading lower today due to profit taking and an updated 7-day weather forecast that shows increased chances of rain in Iowa.

  • The recent drop in corn conditions over the past three weeks will likely force the USDA to lower yields on the July WASDE report and therefore, ending stocks.

  • Exports have been stale as US competitiveness weakens due to high prices, especially as Brazil is slated to harvest a big second crop corn.

  • Today’s drought monitor is expected to show drought expanding even more, and crop conditions haven’t been this poor since the drought year of 1988.

  • Soybeans are under pressure today as both soy products fall sharply driven by soybean oil after yesterday’s EPA announcement. All three soy products have expanded limits after soybean oil closed limit down.

  • The new RFS mandates for 2024 and 2025 show that we would have less soybean processing demand for soybean oil to be used in renewable diesel production.

  • Argentina has become the second largest buyer of Brazilian soy products this year behind China after their drought severely impacted their crop, which they need to meet crush expectations.

  • Additional pressure has come from the Federal Reserve indicating that further rate hikes would be likely this year.

  • Wheat has been trading either side of unchanged so far this morning, but is currently lower, along with both corn and soybeans.

  • The Russian wheat crop has also been cut by 1.2 mmt for 2023 due to dry conditions in main growing regions and poor soil moisture.

  • India’s wheat output for 2023 is at least 10% lower than the government’s estimate, which has caused a sharp increase in local prices over the past two months.

  • Globally, wheat crops may be in trouble as conditions worsen in major wheat growing areas such as the US, Russia, Argentina, and China.

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: June 22, 2023

Bygmidev

All prices as of 6:30 am Central Time

Corn

JUL ’23 664.5 -6.5
DEC ’23 618.5 -10.25
DEC ’24 559 -5.5

Soybeans

JUL ’23 1502.75 -12
NOV ’23 1354.75 -22.25
NOV ’24 1239 -17

Chicago Wheat

JUL ’23 727.75 -6.75
SEP ’23 741 -7.25
JUL ’24 764.25 -10.25

K.C. Wheat

JUL ’23 867.25 -6.5
SEP ’23 865.5 -6.5
JUL ’24 832 -3.75

Mpls Wheat

JUL ’23 876.25 -2.5
SEP ’23 879.25 -2.5
SEP ’24 825 8.75

S&P 500

SEP ’23 4397.75 -11.5

Crude Oil

AUG ’23 71 -1.53

Gold

AUG ’23 1939.2 -5.7

  • Corn is trading lower this morning after overbought conditions caused traders to slow down on purchasing, and weather models shifted slightly overnight.

  • Weather models are now showing greater chances more more substantial rain in the 7-day forecast for the entire state of Iowa, but Illinois and Indiana are expected to stay very dry.

  • The recent drop in corn conditions over the past three weeks will likely force the USDA to lower yields on the July WASDE report and therefore ending stocks.

  • Exports have been stale as US competitiveness weakens due to high prices, especially as Brazil is slated to harvest a big second crop corn.

  • Soybeans are trading lower along with corn, and both soybean oil and meal are lower as well. The entire soy complex has expanded limits today after soybean oil closed limit down yesterday.

  • The slight changes in the weather forecast are pressuring soybeans along with the overbought technicals, and the sharp decline in soybean oil has not helped.

  • The new RFS mandates for 2024 and 2025 show that we would have less soybean processing demand for soybean oil to be used in renewable diesel production.

  • Argentina has become the second largest buyer of Brazilian soy products this year behind China after their drought severely impacted their crop which they need to meet crush expectations.

  • Wheat is trading lower this morning along with corn, and weather forecasts are now showing that spring wheat areas will receive some needed rainfall.

  • India’s wheat output for 2023 is at least 10% lower than the governments estimate which has caused a sharp increase in local prices over the past 2 months.

  • The Russian wheat crop has also been cut by 1.2 mmt for 2023 due to dry conditions in main growing regions and poor soil moisture.

  • Russia has stated that they would not renew the Black Sea grain deal again which is a statement they have made many times, but Ukrainian officials are not optimistic that it will be extended this time.

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.