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Grain Market Insider: June 13, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • The rolling of long positions from the July to the New Crop contracts likely added to the weakness in the July, while December held onto some of its gains from a drop in the good to excellent ratings to 61%.

  • The lowest good to excellent rating for this time since 2013, 59% according to the USDA, and sharp gains in soybean oil, gave soybeans the energy to rally sharply on the day.

  • Soybean oil followed Malaysian palm oil and crude oil higher, and while soybean meal saw significant gains for New Crop, the mere 10-cent gain in July was not enough to keep pace with soybeans as July Board Crush margins fell 10-1/4 cents.

  • All three wheat classes traded on both sides of unchanged today but succumbed to pressure as corn prices faded with K.C. and Minneapolis contracts finishing lower on the day while Chicago held some strength with some mild short covering.

  • The US Dollar closed lower today, likely in anticipation of no change in interest rates at the end of the Federal Reserve meeting that is being held today and tomorrow. As of now the market is estimating a 95% chance that rates will remain unchanged, with a 5% chance of a 0.25% increase.

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

Corn

Corn Action Plan Summary

  •  No action is recommended at this time for Old Crop. July corn has had nearly a 60-cent rally in the last couple of weeks. Expect volatility to remain in the market; a changing weather forecast can push the market significantly in either direction. If you still have Old Crop to sell, consider using this rally to begin pricing some of those bushels. Don’t forget, there is a significant inverse between the July and September futures contracts, which could be lost when bids get rolled from one contract to the next in the next couple of weeks.

  • No action is recommended at this time for New Crop. With dryness building in the Midwest and an estimated fund short position in excess of 40k contracts, we continue to target the 590 – 630 range in the December futures to suggest adding cash sales. If you don’t happen to have any New Crop sold, you should consider targeting the 550 – 560 area to begin pricing bushels.

  • Continue to hold current sales levels for the 2024 crop year. We will look for opportunities to make further sales as we move through the 2023 growing season as weather volatility builds.

Grain Market Insider Corn open positions listed above.

  •  Corn prices finished mixed on the day as prices faded off early session strength supported by a further reduction in crop ratings.

  •  Spread activity in the later part of the session pressured prices as traders moved long positions out of the July contract. The spread between July and September corn futures has dropped 20 cents from 85 cents to 65 cents in the past four trading sessions.

  •  Weekly Crop ratings slipped again on the USDA Crop Progress report, dropping an additional 3% to 61% good/excellent. Analysts were expecting 62% good/excellent as dry conditions still pressure the crop.

  •  Brazilian corn harvest is starting to pick up, and the push of cheaper, fresh corn supplies hitting the market may limit the front end of the corn market as U.S. prices are well above global competition for export demand.

  •  The weather forecast overall remains spotty as rainfall coverage is expected to be hit-or-miss for the next seven days.

Above: The breakout above the recent congestion area has the market knocking on the door of the next resistance area between the 100-day moving average near 630 and the April high of 647-1/2, and while a test of the April high is within reach, the market is showing some signs of being overbought. Initial support below the market rests between 595 and 575, with additional support near 550. 

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

Soybeans

Soybeans Action Plan Summary

  • July soybeans have rallied 128 cents from the May low and are approaching 1400 psychological resistance. With a 78 cent inversion to the August contract, Grain Market Insider recommends taking advantage of the recent rally to make a sale for the old 2022 soybean crop.

  • We recommend not adding to current sales levels for the new 2023 crop at this time. A quick planting pace with favorable conditions and South American competition greatly pressured soybeans in April and May. The potential remains for a tighter New Crop balance sheet, as the US Drought Monitor map remains concerning. We would consider recommending the next sales in the 1300 to 1350 area.

  • 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 significantly higher today thanks to gains in soybean oil, crop progress that showed conditions declining, and an EPA decision that will be announced tomorrow about biofuel mandates that could be bullish for the soy complex.

  •  Planting progress showed that the soy crop is 96% planted (which is above 86% on average) and 86% emerged vs 70% on average. The good to excellent rating fell by 3 points to 59% due to dry conditions, and the poor to very poor rating rose to 9%.

  •  The Environmental Protection Agency has a June 14 deadline for announcing final renewable volume obligations that will impact the profitability of renewable diesel. The outcome of this decision could be very supportive to the soy complex.

  •  Soybean oil was supported by a jump in crude oil and an increase in palm oil which gained 2.5% today. Soybean oil has become overbought, but it has followed palm oil very closely and will likely continue to do so.

Above: After a strong close last week, July soybeans will look for follow-through momentum to turn around a down-trend that has been in place since April. The strong close above the 20-day moving average is a great sign of a short-term trend change higher. If prices were to set back, support should be found near 1340 with nearby resistance near the 1420 area. 

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

Wheat

Market Notes: Wheat

  • Despite earlier strength, wheat posted gains of just a couple cents in the Chicago contract, while Kansas City and Minneapolis contracts were mostly lower. This is likely because wheat acted as a follower today, and as the gains in corn faded, so did wheat.

  • According to the USDA, 38% of the winter wheat crop is rated good to excellent vs 36% last week. Also, 8% of the crop is harvested vs 9% average.

  • The USDA also said that 97% of the spring wheat crop is planted which is in line with average. Only 60% of that crop is rated good to excellent, compared with 64% last week.

  • Russian export values continue to fall, with reports that they are talking about lowering the floor to $230 per metric ton. This is below current offers of $235-$240 and is well below the $275 floor that was encouraged a couple months ago.

  • The developing El Nino weather pattern is expected to cause drought in Australia, lowering their wheat production.

  • Despite a large wheat crop in India which is expected to be 113.5 mmt, tight stocks may mean that they don’t export much wheat this year, if any at all. This could contribute to tighter global availability.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. The market is down more than 300 cents from its October high and has become extremely oversold. With good price action to start June, the market may be positioned for a short covering rally as new crop harvest quickly approaches. We continue to eye the 640 – 670 range to clean up and market any remaining Old Crop inventory.

  • We recommend not taking any action on the 2023 crop at this time. While the window of opportunity is quickly closing for Old Crop, it is still wide open for better opportunities ahead for New Crop.  We are currently targeting a more aggressive window of 720 – 800 to suggest advancing sales and move more New Crop inventory.

  • No new action is recommended for the 2024 crop at this time. Prices have rallied nicely off of lows to start the month of June. With continued Black Sea tensions July of 2024 futures prices should be able to build off of the recent lows. We are currently targeting the 750-775 area to advance further on sales.

Above: The bullish reversal from May 31 indicates that there is support near 760. US harvest selling pressure should keep upside limited to any near-term rallies. Resistance may be found above the market between 833 and 850, with further support resting below the market near 736-1/4.

2023/24 Spring wheat condition percent good-excellent (red) versus the 5-year average (green).

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 bullish reversal from May 31 indicates that there is support near 760. US harvest selling pressure should keep upside limited to any near-term rallies. Resistance may be found above the market between 833 and 850, with further support resting below the market near 736-1/4. 

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

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2022 crop. With planting concerns and a seasonal tendency for old crop prices to increase over the next 4-5 weeks, we are continuing to wait for better prices to develop. The calendar is becoming a constraint though, and we’ll be looking to part with any remaining old crop bushels by mid-June or so. 

  • 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 the market still largely oversold on the weekly charts and a full growing season ahead of us, we are not looking to make any sales right now.

  • 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 July contract continues to be weak and continues to consolidate. With winter wheat harvest on the horizon, spillover selling pressure could plague the spring wheat market in the weeks to come. Resistance currently sits between 820 and 855 and then the recent high of 888-1/2. Support below the market may be found between 770 and 760.

2023/24 Spring wheat condition percent good-excellent (red) versus the 5-year average (green).

Other Charts / Weather

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Midday Update June 13, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 622.5 5.25
DEC ’23 558 8.75
DEC ’24 520.75 6
Soybeans
JUL ’23 1405 32.25
NOV ’23 1238.25 29.25
NOV ’24 1190.75 19.75
Chicago Wheat
JUL ’23 644 10.25
SEP ’23 656 10
JUL ’24 698.75 8.75
K.C. Wheat
JUL ’23 799.25 2.75
SEP ’23 797.5 3.75
JUL ’24 769.5 3.25
Mpls Wheat
JUL ’23 822 7.75
SEP ’23 821.5 6.75
SEP ’24 788.5 2
S&P 500
SEP ’23 4419.25 31.25
Crude Oil
AUG ’23 69.52 2.23
Gold
AUG ’23 1963.2 -6.5

  • The USDA rated the corn crop 61% good to excellent (down 3% from last week).

  • The western corn belt has rain in the forecast later this week, but it is expected to remain scattered and spotty.

  • Brazil has a frost risk this week, but still looks like they will produce a record corn crop of 132 mmt.

  • December corn futures have gained roughly 70 cents since the May 18 low. The Dec contract did gap higher yesterday indicating market strength; however, that gap could be filled down the road.

  • As reported by CNBC, one vessel left Ukraine over the weekend, hauling 69,000 mt of corn to Spain.

  • The USDA rated the soybean crop 59% good to excellent (down 3% from last week). This is the worst rating for this time of year since 2013.

  • August palm oil futures are up 2.5%, lifting soybean oil, and providing support to soybean futures.

  • Tomorrow the EPA will announce biofuel mandates for 2023 – 2025. Depending upon what the ruling is, this could have a large impact on soybean oil and soybean demand as more plants come online.

  • Chinese soybean imports to date are ahead of last year, however there is still concern about what their demand will look like down the road if their economy does not pick up.

  • The USDA said 8% of the winter wheat crop is harvested (vs 9% average), and that crop is rated 38% good to excellent (up 2% from last week).

  • The USDA said 97% of the spring wheat crop is planted (in line with average) and is rated 60% good to excellent (down 4% from last week).

  • Though it is early, wheat inspections for 23/24 are only at 12 mb, which is down 50% from last year.

  • Russian FOB offers are now said to be as low as $235-$240 per metric ton. Russia is reportedly talking about lowering that floor to as little as $230. This is certain to keep pressure on the US export market.

  • India is expected not to export wheat this year despite a large crop (due to tight stocks).

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 13, 2023

ByGrain Market Insider

All prices as of 6:30 am Central Time

Corn

JUL ’23 620.75 3.5
DEC ’23 553 3.75
DEC ’24 518.75 4

Soybeans

JUL ’23 1389.75 17
NOV ’23 1221 12
NOV ’24 1180 9

Chicago Wheat

JUL ’23 631.75 -2
SEP ’23 643.25 -2.75
JUL ’24 686.25 -3.75

K.C. Wheat

JUL ’23 789 -7.5
SEP ’23 786 -7.75
JUL ’24 759.25 -7

Mpls Wheat

JUL ’23 808.75 -5.5
SEP ’23 808.75 -6
SEP ’24 788.5 2

S&P 500

SEP ’23 4393.5 5.5

Crude Oil

AUG ’23 68.58 1.29

Gold

AUG ’23 1978.8 9.1

  • Corn is trading slightly higher again this morning after yesterday’s weather driven rally. Yesterday’s crop progress showed corn ratings slipping more than expected.

  • Crop progress showed the corn crop at 93% emerged which was up from 85% last week and up from the average, but the good to excellent rating fell more than expected to 61% from 64% last week due to dry conditions.

  • While most of the Corn Belt is dry, the 5-day forecast shows beneficial rainfall totals in the area with a focus on Minnesota, Iowa, and Missouri. The rains are expected around Thursday and Friday.

  • Corn prices in Brazil remain significantly cheaper than in the US, cutting into export business. Corn in Brazil is trading at the equivalent of $4.61 a bushel.

  • Soybeans are trading higher this morning after yesterday’s crop progress report. Soybean meal is higher as well as soybean oil which is getting support from palm oil which is up 2.5%.

  • Crop progress showed soybeans 86% emerged which was up from 74% last week, but the good to excellent rating fell to 59% from 62% a week ago, below trade expectations.

  • The Environmental Protection Agency has a June 14 deadline for announcing final renewable volume obligations that will impact the profitability of renewable diesel.

  • Crop ratings for both corn and soybeans saw the biggest declines in eastern states, so the benefit of Sunday’s rains likely weren’t included in yesterday’s ratings.

  • Wheat is trading lower this morning as harvest begins, and crop ratings improved from the previous week after recent rains.

  • Winter wheat is now rated 38% good to excellent which is up from 36% a week ago, 89% of the crop is headed and 8% is harvested which compares with 4% a week ago.

  • Spring wheat is 90% emerged which compares with 76% a week ago, but good to excellent ratings fell to 60% from 64% a week ago.

  • The high plains drought is so bad that Kansas is reportedly importing wheat from Europe in a rare move.

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 12, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Increasing dryness and a forecast for limited moisture rallied July corn to test the 100-day moving average for the first time in two months.

  • Weak export inspections and Fund spreading weighed heavily on Old Crop contracts, while New Crop was able to close on the positive side of unchanged as weather premium is added to the market.

  • Carryover strength from corn helped to boost Chicago and Minneapolis contracts, while K.C. contracts saw continued pressure from better than expected crop numbers in Friday’s USDA report.

  • Limited rainfall this past weekend brought the buyers out for the New Crop contracts as the market turned its attention to the weather, and with some rain chances expected in the next week a keen eye will be on Iowa, Illinois, and Missouri.

  • To see the updated NOAA 8-14 Day Temperature and Precipitation Outlooks and 7-day NOAA Precipitation Outlook scroll down to the Other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  •  No action is recommended at this time for Old Crop. July corn has had nearly a 60-cent rally in the last couple of weeks. Expect volatility to remain in the market, a changing weather forecast can push the market significantly in either direction. If you still have Old Crop to sell, consider using this rally to begin pricing some of those bushels. Don’t forget, there is about an 80-cent inverse between the July and September futures contracts, which could be lost when bids get rolled from one contract to the next in the next few weeks.

  • No action is recommended at this time for New Crop. With dryness building in the Midwest and an estimated fund short position in excess of 40k contracts, we continue to target the 590 – 630 range in the December futures to suggest adding cash sales. If you don’t happen to have any New Crop sold, you should consider targeting the 550 – 560 area to begin pricing bushels.

  • Continue to hold current sales levels for the 2024 crop year. We will look for opportunities to make further sales as we move through the 2023 growing season as weather volatility builds.

Grain Market Insider Corn open positions listed above.

  • Corn futures finished higher on the session as recent rainfall lacked the coverage and intensity that was anticipated, causing additional short covering as prices pushed higher through some levels of resistance.

  • Weekly crop ratings will be released on Monday afternoon, and expectations are for an additional drop in corn ratings to 62% good/excellent, down 2% from 64% last week.

  • The weather will stay as the market’s focus as weather models are variable over the next 10 days as overall rainfall still looks limited, pressuring the stressed crop.

  • Demand remains a concern as the weekly export inspection report was released on Monday morning. Last week, U.S. exporters shipped 1.169 MMT of corn, near the top end of expectations, but still behind the pace needed to reach the USDA corn export goal. Corn shipments are still down 31% year–over-year.

  • Brazil corn harvest of their second crop corn is starting to begin. Private analyst, AgRural, forecasted that Brazilian farmers have harvested 2.2% of the area planted for corn. This is down from 6.6% last year. 

Above: The breakout above the recent congestion area has the market knocking on the door of the next resistance area between the 100-day moving average near 630 and the April high of 647-1/2, and while a test of the April high is within reach, the market is showing some signs of being overbought. Initial support below the market rests between 595 and 575, with additional support near 550. 

Corn Managed Money Funds net position as of Tuesday, June 6. Net position in Green versus price in Red. Money Managers net bought 6,573 contracts between May 31 – June 6, bringing their total position to a net short 44,492 contracts.

Soybeans

Soybeans Action Plan Summary

  • The trend in the soybean market since early April has been down. Since the bullish reversal on 5/31, the market has found some support near 1270 and has formed a possible head-and-shoulders bottom. The Old Crop balance sheet remains on the tight side, and as dryness continues to build, we remain in a seasonal window that is conducive to upside opportunity and volatility. Continue to hold on progressing any Old Crop sales for now.

  • We recommend not adding to current sales levels for the new 2023 crop at this time. A quick planting pace with favorable conditions and South American competition greatly pressured soybeans in April and May. The potential remains for a tighter New Crop balance sheet, as the US Drought Monitor map remains concerning. We would consider recommending the next sales in the 1300 to 1350 area.

  • 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 ended the day mixed with the July contract posting losses and deferred contracts gaining as first notice approaches and funds likely rolled out of some of their Jul contracts and into Sep and Nov. Soybean meal closed slightly higher, while soybean oil fell alongside crude.

  • Export inspections for soybeans were low at 5.2 mb and put total inspections for 22/23 at 1.794 bb which is down 3% from last year. The USDA is estimating soybean exports at 2.000 bb for 22/23 which is down 7% from last year.

  • Weather has been a key factor for the moves in corn and this past weekend’s rains were spotty and underwhelming, but soybeans have more time before rains become crucial and so did not keep up with the gains in corn today.

  • Crop progress will be released later today, and estimates are that the good to excellent rating in soybeans will drop to 60% from 62% last week, and that 96% of the crop will be planted which would be up from 91% last week.

Above: After a strong close last week, July soybeans will look for follow-through momentum to turn around a down-trend that has been in place since April. This week’s strong close above the 20-day moving average is a great sign of a short-term trend change higher. If prices were to set back, support should be found near 1340 with nearby resistance near the 1420 area. 

Soybeans Managed Money Funds net position as of Tuesday, June 6. Net position in Green versus price in Red. Money Managers net bought 13,452 contracts between May 31 – June 6, bringing their total position to a net long 13,981 contracts.

Wheat

Market Notes: Wheat

  • After a two-sided trade, the wheat complex closed mostly higher. Wheat acted as a follower today and was likely pulled higher by the corn market into the end of the session.

  • Weekly wheat export inspections were pegged at 9.1 mb., bringing total 23/24 inspections to 12 mb. The USDA is estimating 23/24 wheat exports at 725 mb versus 775 for 22/23.

  • Some support may have come from higher Paris milling wheat futures. Dry conditions in Spain and northern France may be the reason for Matif wheat’s uptrend since the May 31 lows, and because of this dry weather, one analyst group is estimating a decline in European wheat production of 2.1 mmt.

  • Managed funds are estimated to still be net short 122,280 contracts of Chicago wheat. With uncertain weather, in addition to global political and economic uncertainties, this could prime the wheat market for a short covering rally.

  • On Friday’s USDA report, US HRW wheat production was increased by 11 mb, and this is being attributed to recent rains in Texas and Oklahoma that helped the crop. Kansas production was left unchanged in the report.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. The market is down more than 300 cents from its October high and has become extremely oversold. With good price action to start June, the market may be positioned for a short covering rally as new crop harvest quickly approaches. We continue to eye the 640 – 670 range to clean up and market any remaining Old Crop inventory.

  • We recommend not taking any action on the 2023 crop at this time. While the window of opportunity is quickly closing for Old Crop, it is still wide open for better opportunities ahead for New Crop.  We are currently targeting a more aggressive window of 720 – 800 to suggest advancing sales and move more New Crop inventory.

  • No new action is recommended for the 2024 crop at this time. Prices have rallied nicely off of lows to start the month of June. With continued Black Sea tensions July of 2024 futures prices should be able to build off of the recent lows. We are currently targeting the 750-775 area to advance further on sales.

Above: The market appears to have put in short-term lows to end the month of May near the 575 level. A close above the 660 area would be a supportive sign of a trend change to higher. The next area of possible support, if the late May lows do not hold, would be below the market near the September ’20 low of 533-1/4. Resistance above the market could be found between 670 and 724.

Chicago Wheat Managed Money Funds net position as of Tuesday, June 6. Net position in Green versus price in Red. Money Managers net bought 7,524 contracts between May 31 – June 6, bringing their total position to a net short 119,474 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. Crop ratings overall are at historically low levels, and production concerns persist. Additionally, any unforeseen geopolitical changes in the Black Sea region could cause the market to bounce and retrace 25% towards the 2022 high. 

  • 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: Last week Wednesday’s bullish reversal indicates that there is support near 760. US harvest selling pressure should keep upside limited to any near-term rallies. Resistance may be found above the market between 833 and 850, with further support resting below the market near 736-1/4. 

K.C. Wheat Managed Money Funds net position as of Tuesday, June 6. Net position in Green versus price in Red. Money Managers net sold 2522 contracts between May 31 – June 6, bringing their total position to a net long 7,106 contracts.

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2022 crop. With planting concerns and a seasonal tendency for old crop prices to increase over the next 4-5 weeks, we are continuing to wait for better prices to develop. The calendar is becoming a constraint though, and we’ll be looking to part with any remaining old crop bushels by mid-June or so. 

  • 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 pace has largely caught up to the 5-year average, dryness in some areas is increasing. With the market still largely oversold and a full growing season ahead of us, we are not looking to make any sales right now.

  • 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 July contract continues to be weak and showing signs of being oversold after breaking back below the 800 level this week.  With winter wheat harvest on the horizon, spill over selling pressure could plague the spring wheat market in the weeks to come. Resistance currently sits between 820 and 855 and then the recent high of 888-1/2.  Support below the market may be found between 770 and 760. 

Minneapolis Wheat Managed Money Funds net position as of Tuesday, June 6. Net position in Green versus price in Red. Money Managers net sold 1,271 contracts between May 31 – June 6, bringing their total position to a net short 8,974 contracts.

Other Charts / Weather

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Midday Update June 12, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 621.5 17.25
DEC ’23 546.5 16
DEC ’24 514.25 9.75
Soybeans
JUL ’23 1384.25 -2.25
NOV ’23 1213 8.75
NOV ’24 1170.5 7.5
Chicago Wheat
JUL ’23 638.25 8
SEP ’23 650 8.25
JUL ’24 692.5 6.25
K.C. Wheat
JUL ’23 800.25 2.5
SEP ’23 795.75 2
JUL ’24 765 2
Mpls Wheat
JUL ’23 817.25 5.5
SEP ’23 817 4.5
SEP ’24 786.5 -3.5
S&P 500
SEP ’23 4356.75 8
Crude Oil
AUG ’23 68.03 -2.3
Gold
AUG ’23 1971.7 -5.5

  • Over the weekend, rainfall in the Midwest was scattered and spotty. Additionally, the week one weather forecast shows a few light showers in the Midwest with temperatures below normal. The second week shows better chances for rain and temperatures warming up.

  • Outside markets could be an influence this week. The Fed will come out with their decision on interest rates, and whether or not they will take a pause, or issue another increase.

  • Brazil is experiencing some cold temperatures with more in the forecast, which could impact their later planted corn crop.

  • Ag Resource has reportedly dropped their US corn yield projection to 177 bpa. The USDA is using a yield of 181.5 bpa.

  • At midday, crude oil is down over $3 per barrel. This is likely weighing on soybean oil and limiting upside price movement in soybeans.

  • China has been accused of shipping “fake” biodiesel to secure European grants. This could increase US soybean oil demand from Europe if they reduce imports from China.

  • According to the Malaysian Palm Oil Board, stocks of palm oil at the end of May were up 13% from the previous month.

  • Expectations for this afternoon’s Crop Progress report are to show a decline in the good to excellent rating for soybeans (and corn).  

  • On Friday’s report, the USDA lowered Argentina’s soybean crop by 2 mmt to 25 mmt. Argentina’s exchanges, however, are 3 mmt lower at 22 mmt.

  • Funds are reported to be net short 122,280 contracts of Chicago wheat.

  • Friday’s USDA report showed higher US HRW wheat production on the order of 11 mb. This is interesting, considering the recent challenges faced in the US southern Plains, but is attributed to the recent rains in Texas and Oklahoma.

  • Dryness in Spain and northern France could mean lower wheat crops there. One group is estimating a decrease of European wheat production by 2.1 mmt for this reason. This would bring the European wheat crop to 142.4 mmt.

  • Alberta, Canada received some rain this weekend, but most of the Canadian prairies remain too dry.

  • The USDA raised their estimate of global wheat ending stocks on Friday’s report. This adds to pressure on US futures and may be one reason why wheat is trading mixed to lower at midday.

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 12, 2023

ByGrain Market Insider

All prices as of 6:30 am Central Time

Corn

JUL ’23 616.25 12
DEC ’23 543.75 13.25
DEC ’24 514 9.5

Soybeans

JUL ’23 1390.25 3.75
NOV ’23 1213.5 9.25
NOV ’24 1173.75 10.75

Chicago Wheat

JUL ’23 633.5 3.25
SEP ’23 645.25 3.5
JUL ’24 690.5 4.25

K.C. Wheat

JUL ’23 798.25 0.5
SEP ’23 795.5 1.75
JUL ’24 764 1

Mpls Wheat

JUL ’23 815.25 3.5
SEP ’23 815.5 3
SEP ’24 786.5 -3.5

S&P 500

SEP ’23 4358.5 9.75

Crude Oil

AUG ’23 68.84 -1.49

Gold

AUG ’23 1977.8 0.6

  • Corn is trading higher this morning after weekend rains left much to be desired. Rain only fell in select areas of the Belt but areas that did receive rain got a healthy amount.

  • There is only light rain forecast near Colorado and east of Michigan today, and areas that did not receive rain over the weekend are struggling.

  • Dr. Cordonnier lowered his US corn yield to 179 bps which would bring production down to 14.94 billion bushels. Acreage was left alone at 91.5 mb.

  • Friday’s CFTC report showed funds as of June 6 buying back 6,573 contracts of corn, decreasing their net short position to 44,492 contracts.

  • Soybeans are trading higher this morning but have not kept up with the gains in corn. Dryness over the weekend has been a bullish factor, but soybeans can wait a bit longer for rain before it becomes an issue.

  • Light to moderate rains are forecast across the Midwest this week, but models are mostly dry west of Indiana and north of Missouri.

  • Malaysian May palm oil stocks rose to 1.69m tons from 1.5m tons in April which has been a main pressure for lower soybean oil lately.

  • Friday’s CFTC report showed funds adding to their net long position buying 13,452 contracts, increasing their net long position to 13,981 contracts.

  • Wheat is mixed this morning with Chicago and Minn higher but KC lagging behind as weather, Russia, and small changes in the WASDE affect prices.

  • Kansas, Oklahoma, and Texas have all received beneficial rains recently improving the HRW wheat crop, but further north, the majority of the western Canadian Prairies were mostly dry, although rains are forecast later this week.

  • USDA’s NASS made a small increase to its winter wheat production estimate going from 1.130 bb to 1.136 bb, largely based on an 11 mb increase in the HRW wheat estimate.

  • Friday’s CFTC report showed funds buying back some of their short position by 7,524 contracts, decreasing their net short position to 119,474 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: June 9, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Corn was lower to end the week after the USDA lowered 22/23 corn exports by 50 million bushels bringing ending stocks in line with pre-report estimates, but still higher than the May estimate.

  • Soybeans closed sharply higher with help once again from higher soybean oil prices. July Soybean Oil futures have closed higher in five of the first seven trading days to start the month of June.

  • Wheat was mixed with Chicago contacts moving higher while K.C. and Minneapolis contracts slid lower. Overall, the WASDE report was viewed as neutral to the wheat market with only minor changes from last month’s numbers.

  • With the June WASDE report in the rearview mirror, the trade will turn its attention back to weather as we enter critical weeks of crop development for corn and soybeans.

  • To see the updated NOAA 8-14 Day Temperature and Precipitation Outlooks and 7-day NOAA Precipitation Outlook scroll down to the Other Charts/Weather Section.

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

Corn

Corn Action Plan Summary

  •  No action is recommended at this time for Old Crop. July corn has had nearly a 60-cent rally in the last couple of weeks. Expect volatility to remain in the market, a changing weather forecast can push the market significantly in either direction. If you still have Old Crop to sell, consider using this rally to begin pricing some of those bushels. Don’t forget, there is about an 80-cent inverse between the July and September futures contracts, which could be lost when bids get rolled from one contract to the next in the next few weeks.

  • No action is recommended at this time for New Crop. With dryness building in the Midwest and an estimated fund short position in excess of 40k contracts, we continue to target the 590 – 630 range in the December futures to suggest adding cash sales. If you don’t happen to have any New Crop sold, you should consider targeting the 550 – 560 area to begin pricing bushels.

  • Continue to hold current sales levels for the 2024 crop year. We will look for opportunities to make further sales as we move through the 2023 growing season as weather volatility builds.

Grain Market Insider Corn open positions listed above.

  • Corn futures finished lower on Friday as a confirmed growing supply picture and potential weather pattern shifts limited buying support. July corn futures closed the week 4-3/4 cents lower and December lost 10-3/4 cents.

  • The USDA June WASDE report lowered old crop corn export demand by 50 MB but decreased corn imports by 15 MB to add a difference of 35 MB to projected carryout. Old crop carryout is now at 1.452 BB and New crop was raised to 2.257 BB. The report was close to analysts’ expectations, but still confirmed a weaker demand tone and larger supply picture.

  • The USDA raised their projection for Brazilian corn production to 132 MMT (approx. 5.118 BB) by adding 2 MMT (79MB) over last month’s projections, this was larger than analyst expectations.

  • Now with the report behind the market, traders will shift focus back to the weather. Models are showing a potential change overall to a cooler and wetter pattern, but the market will be watching precipitation totals and locations over the weekend.

  • Corn future weakness may have been limited late today by buying strength in the soybean markets, and the Chicago wheat market trading off the lows of the session.

Above: Prices have continued to run into resistance at the 610 area. If current prices can hold and close above the 50-day moving average near 604, the market would be poised to test April’s high of 647-1/2. Support below the market rests between 550 and 530, and again near the 2021 September low of 497-1/2. 

Soybeans

Soybeans Action Plan Summary

  • May was a rough month for soybeans with a 175-cent range, but the market is consolidating, and found support just above 1270. July soybeans continue to be oversold with a tight Old Crop balance sheet, and with dryness concerns building and a seasonal window that is conducive for upside volatility and opportunity, continue to hold on progressing any Old Crop sales for now.

  • We recommend not adding to current sales levels for the new 2023 crop at this time. A quick planting pace with favorable conditions and South American competition greatly pressured soybeans in April and May. The potential remains for a tighter New Crop balance sheet, as the US Drought Monitor map remains concerning. We would consider recommending the next sales in the 1300 to 1350 area.

  • 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 ended significantly higher on the day despite a neutral WASDE report. Soybean meal closed lower in the front months, while soybean oil closed higher as palm oil begins to recover.

  • Today’s WASDE report held essentially no surprises. The USDA lowered Argentinian production to 25 mmt from their previous estimate of 27 mmt, but that is likely still too high. Brazilian production was increased by 1 mmt to 156 mmt. In the US, soybean ending stocks were increased to 350 mb which was higher than the average trade guess.

  • Private exporters reported to the USDA export sales of 197,000 mt of soybeans for delivery to unknown destinations for the 22/23 marketing year. The marketing year for soybeans began on September 1.

  • Now that the WASDE is out of the way with very little reaction, traders will turn their focus back to weather. Forecasts for the Corn Belt this weekend and into the next week call for rain, but it may only be around 1 inch. If rains don’t fall this weekend, prices could easily move higher.

Above: After a strong close last week, July soybeans will look for follow-through momentum to turn around a down-trend that has been in place since April. This week’s strong close above the 20-day moving average is a great sign of a short-term trend change higher. If prices were to set back, support should be found near 1340 with nearby resistance near the 1420 area. 

Wheat

Market Notes: Wheat

  • All eyes were on today’s USDA report which was overall neutral. Despite this, Chicago wheat posted small gains at the close alongside Paris milling wheat futures. Kansas City and Minneapolis contracts were lower, however.

  • The US 23/24 all wheat production was raised slightly from 1.659 bb in May, to 1.665 bb on today’s report.

  • The US 22/23 wheat carryout was unchanged at 598 mb. However, it was raised slightly for 23/24, from 556 mb in May to 562 mb in June, due to a slight increase in overall production.

  • The USDA estimated the average US wheat yield at 44.9 bpa, up from 44.7 last month. However, this is lower than the average yield last year of 47.0 bpa.

  • Russian wheat production was raised by 3.5 mmt to 85.0 mmt, and Ukraine was raised 1.0 mmt to 17.5 mmt. India and the European Union also saw increases to their overall wheat harvest estimates.

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop.  The market is down more than 300 cents from its October high and has become extremely oversold. With good price action to start June, the market may be positioned for a short covering rally as new crop harvest quickly approaches. We continue to eye the 640 – 670 range to clean up and market any remaining Old Crop inventory.

  • We recommend not taking any action on the 2023 crop at this time. While the window of opportunity is quickly closing for Old Crop, it is still wide open for better opportunities ahead for New Crop.  We are currently targeting a more aggressive window of 720 – 800 to suggest advancing sales and move more New Crop inventory.

  • No new action is recommended for the 2024 crop at this time. Prices have rallied nicely off of lows to start the month of June. With continued Black Sea tensions July of 2024 futures prices should be able to build off of the recent lows. We are currently targeting the 750-775 area to advance further on sales.

Above: The market appears to have put in short-term lows to end the month of May near the 575 level. A close above the 660 area would be a supportive sign of a trend change to higher. The next area of possible support, if the late May lows do not hold, would be below the market near the September ’20 low of 533-1/4.  Resistance above the market could be found between 670 and 724.

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. Crop ratings overall are at historically low levels, and production concerns persist.  Additionally, any unforeseen geopolitical changes in the Black Sea region could cause the market to bounce and retrace 25% towards the 2022 high. 

  • 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: Last week Wednesday’s bullish reversal indicates that there is support near 760. US harvest selling pressure should keep upside limited to any near-term rallies. Resistance may be found above the market between 833 and 850, with further support resting below the market near 736-1/4. 

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2022 crop.  With planting concerns and a seasonal tendency for old crop prices to increase over the next 4-5 weeks, we are continuing to wait for better prices to develop. The calendar is becoming a constraint though, and we’ll be looking to part with any remaining old crop bushels by mid-June or so. 

  • 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 pace has largely caught up to the 5-year average, dryness in some areas is increasing. With the market still largely oversold and a full growing season ahead of us, we are not looking to make any sales right now.

  • 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 July contract continues to be weak and showing signs of being oversold after breaking back below the 800 level this week.  With winter wheat harvest on the horizon, spill over selling pressure could plague the spring wheat market in the weeks to come. Resistance currently sits between 820 and 855 and then the recent high of 888-1/2.  Support below the market may be found between 770 and 760. 

Other Charts / Weather

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Midday Update June 9, 2023

ByGrain Market Insider

All prices as of 10:30 am Central Time

Corn
JUL ’23 602 -8.25
DEC ’23 526 -7
DEC ’24 504.75 -4.5
Soybeans
JUL ’23 1383.75 20.5
NOV ’23 1199.75 10.75
NOV ’24 1152.5 5.75
Chicago Wheat
JUL ’23 625 -1.25
SEP ’23 637 -2
JUL ’24 681.25 -3.75
K.C. Wheat
JUL ’23 798.25 -6.5
SEP ’23 796 -7.75
JUL ’24 767 -0.5
Mpls Wheat
JUL ’23 810.25 -5.5
SEP ’23 811.25 -6.75
SEP ’24 790 20
S&P 500
SEP ’23 4360.75 19
Crude Oil
AUG ’23 71.46 0.02
Gold
AUG ’23 1978.8 0.2

  • Corn is trading lower ahead of today’s WASDE report and is also being pressured by rain in the forecast this weekend for the Midwest.

  • Rain is expected this weekend and early next week for the Corn Belt, but Iowa, Illinois, Indiana, and Ohio rain totals are only projected to reach an inch or slightly more.

  • The focus of today’s WASDE report will likely be on corn ending stocks which are expected to increase, and Argentina’s production which the USDA will likely decrease.

  • Monday’s crop progress will probably show a decline in good to excellent ratings following the dry weather, but ratings could easily jump higher after a week of decent rains.

  • Soybeans are trading higher after getting a boost from a reported flash sale. Soybean oil is higher and is being supportive while soybean meal is lower.

  • Private exporters reported to the USDA export sales of 197,000 mt of soybeans for delivery to unknown destinations for the 22/23 marketing year. The marketing year for soybeans began on September 1.

  • In today’s WASDE report, traders will focus on production cuts for Argentina with estimates of a 3 mmt decline to 24 mmt. Argentina’s real production will likely be closer to 20 mmt.

  • Palm oil futures have been a large bearish factor for the soybean oil market and palm oil fell 1.72% today as supplies continue to rise in both Malaysia and Indonesia.

  • Wheat was mixed this morning, but Chicago has turned lower bringing all three products down for the day. Funds remain short as Russia continues to offer wheat for significantly cheaper cash prices.

  • The WASDE report estimates from the Dow Jones survey have US wheat ending stocks moving higher by just 8 mb to 606 mb, but adjustments down the line are possible thanks to recent rains.

  • Russia continues to keep their grip on the export market making sales to Egypt, and there have been reports of Russian offers for August as low as $226/mt FOB Black Sea for 12.5 protein wheat.

  • French wheat conditions have fallen for two straight weeks and went from 93% good to excellent to 88% due to heat and dryness, and China, Australia, and Argentina are having issues with their wheat crops as well.

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 9, 2023

ByGrain Market Insider

All prices as of 6:30 am Central Time

Corn

JUL ’23 606.5 -3.75
DEC ’23 529.25 -3.75
DEC ’24 507 -2.25

Soybeans

JUL ’23 1369 5.75
NOV ’23 1191.5 2.5
NOV ’24 1147 0.25

Chicago Wheat

JUL ’23 625.5 -0.75
SEP ’23 638.75 -0.25
JUL ’24 683.25 -1.75

K.C. Wheat

JUL ’23 795.75 -9
SEP ’23 794 -9.75
JUL ’24 760.75 -6.75

Mpls Wheat

JUL ’23 807.5 -8.25
SEP ’23 809.5 -8.5
SEP ’24 790 20

S&P 500

SEP ’23 4339.75 -2

Crude Oil

AUG ’23 71.63 0.19

Gold

AUG ’23 1979.8 1.2

  • Corn is trading lower this morning as forecasts predict that a front will move through the Midwest bringing showers to most areas.

  • Today’s WASDE report will be released at 11 central and traders are expecting old crop ending stocks to rise slightly and for exports to drop.

  • US corn crops in drought areas jumped to 45% with corn crops experiencing moderate drought rose by 11% from the previous week.

  • Brazilian corn production has been estimated higher by Bloomberg around 130.3 mmt, 4.7 mmt higher than the previous estimate.

  • Soybeans are trading higher across the board with gains in soybean oil and meal as well. Crude oil is also trading higher.

  • Helping soybeans and soybean oil is India cutting their palm oil imports in favor of soybean oil and sunflower oil, with imports of soybean oil jumping to 301,000 tons vs 262,000 tons last month.

  • Barge shipments on the Mississippi River fell for the week ending June 3 with soybean shipments down 26% from the previous week.

  •  Today’s WASDE report will likely show a decrease in Argentinian production and US ending stocks may also be increased.

  • Wheat is mixed this morning with Chicago trading slightly higher but KC and Minneapolis down ahead of the WASDE.

  • HRW wheat conditions have improved significantly thanks to recent rains, but the good to excellent ratings are still at only 36%.

  • China will reportedly feed more wheat to animals after heavy rains damaged high quality wheat which could see their import demand for wheat rise.

  • Traders are expecting that Friday’s WASDE will show a jump in US winter wheat yields over last month’s USDA 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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Grain Market Insider: June 8, 2023

ByGrain Market Insider

All prices as of 1:45 pm Central Time

Grain Market Highlights

  • Corn closed higher as forecasted weekend rainfall totals continue to fluctuate for areas of desperate need in the eastern Corn Belt. Spillover strength from the wheat market also helped add to higher momentum.

  • Soybeans ended higher, driven mostly by another daily surge in soybean oil futures. Soybean meal futures were fractionally lower on continued demand concerns.

  • Wheat ended higher despite weak export sales and a continued drop in Russian wheat export values.

  • The US Dollar Index moved sharply lower, closing below the 20-day moving average for the first time since early May, this helped support commodities throughout the session.

  • To see the updated US Drought Monitor Map and 7-day NOAA Precipitation Outlook 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

  •  

  • Corn prices finished higher on the session, fighting off overnight lows in some position squaring before Friday’s USDA report. The corn market was also supported by fluctuating weather models for weekend rains, and strength in the wheat market on increasing Ukrainian-Russian war tensions.

  • The USDA released weekly exports sales this morning for corn, and old crop sales were 173,000 MT and new crop sales saw cancelations of 107,000 MT. Overall sales were at the low end of expectations as export demand remains weak.

  • The wheat market was supported by the talk of a Ukrainian counter offensive, escalating activity in the Russia-Ukraine war. The strong wheat market spilled over to support corn prices at the end of the session.

  • Tomorrow morning at 11:00 CST, the USDA will release the June WASDE report. The June WASDE is expected to show a weaker demand tone and overall increasing corn supplies. The trade is looking for old-crop carryout at 1.449 billion bushels (bb), up slightly from last month; new crop at 2.254 bb, also up slightly.

Grain Market Insider Corn open positions listed above.

  • Corn prices finished higher on the session, fighting off overnight lows in some position squaring before Friday’s USDA report. The corn market was also supported by fluctuating weather models for weekend rains, and strength in the wheat market on increasing Ukrainian-Russian war tensions.

  • The USDA released weekly exports sales this morning for corn, and old crop sales were 173,000 MT and new crop sales saw cancelations of 107,000 MT. Overall sales were at the low end of expectations as export demand remains weak.

  • The wheat market was supported by the talk of a Ukrainian counter offensive, escalating activity in the Russia-Ukraine war. The strong wheat market spilled over to support corn prices at the end of the session.

  • Tomorrow morning at 11:00 CST, the USDA will release the June WASDE report. The June WASDE is expected to show a weaker demand tone and overall increasing corn supplies. The trade is looking for old-crop carryout at 1.449 billion bushels (bb), up slightly from last month; new crop at 2.254 bb, also up slightly.

Above: Prices have continued to run into resistance at the 610 area. If current prices can hold and close above the 50-day moving average near 604, the market would be poised to test April’s high of 647-1/2. Support below the market rests between 550 and 530, and again near the 2021 September low of 497-1/2. 

Soybeans

Soybeans Action Plan Summary

  • May was a rough month for soybeans with a 175-cent range, but the market is consolidating, and found support just above 1270. July soybeans continue to be oversold with a tight Old Crop balance sheet, and with dryness concerns building and a seasonal window that is conducive for upside volatility and opportunity, continue to hold on progressing any Old Crop sales for now.

  • We recommend not adding to current sales levels for the new 2023 crop at this time. A quick planting pace with favorable conditions and South American competition have pressed US prices down nearly 17% from the beginning of the year. The potential remains for a tighter New Crop balance sheet, as the US Drought Monitor map remains concerning. We would consider recommending the next sales in the 1300 to 1350 area.

  • 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 ended the day higher, driven by large gains in soybean oil, which saw the July contract 4% higher, while soybean meal moved lower.

  • Export sales were decent, all things considered, the USDA reported an increase of 7.6 mb for the 22/23 year, which was up 68% from the previous week, 9.7 mb were reported for 23/24. Export shipments of 9.1 mb were below the 12.1 mb needed each week to meet the USDA’s expectations.

  • US biodiesel exports for April were up 110% from last year at over 147,000 mt, which is the highest on record. The first four months of the year were 52% higher than that of a year ago.

  • Tomorrow’s WASDE report will be released at 11:00 CST, and traders will be watching for a change in the carryout number. Trade expectations are for 223 mb of old crop beans and 345 mb of new crop, which would be slightly up from last month. Argentinian production will most likely be revised lower.

Above: After a strong close last week, July soybeans will look for follow-through momentum to turn around a down-trend that has been in place since April. Support should be found near the recent lows of 1300 with nearby resistance near the 1420 area.

Wheat

Market Notes: Wheat

  • Weekly export sales for wheat were reported at 8.6 mb. Shipments last week of just 7.0 mb are well below the needed 34.5 mb per week to reach the 775 mb export estimate.

  • Russian wheat export values continue to fall, with reports of August offers as low as $226 per metric ton. With Russia cutting into US exports, it is possible that in tomorrow’s USDA report there may be an increase to US carryout.

  • Most Ukrainian wheat areas and spring wheat areas of Russia remain dry. Australia is wet, however. This is contrary to the typical El Nino pattern, which should bring dryness to Australia’s wheat growing areas.

  • The average pre-report estimate for US 23/24 all wheat production is 1.666 bb (vs 1.659 in May, and 1.650 for 22/23)

  • The average pre-report estimate for US 22/23 wheat carryout is 606 mb (vs 598 in May), estimates for 23/24 carryout come in at 568 mb (vs 556 in May).

Chicago Wheat Action Plan Summary

  • No new action is recommended for the 2022 crop. The market is down more than 300 cents from its October high and has become extremely oversold. The July contract may also post its 8th consecutive down month in a row at prices not seen since early 2021, even though wheat inventories of major exporting countries are anticipated to fall to 16-year lows. With the market being this oversold and a fund net position short nearly 113k contracts, we continue to eye the 640 – 670 range to clean up and market any remaining Old Crop inventory.

  • We recommend not taking any action on the 2023 crop at this time. While the window of opportunity is quickly closing for Old Crop, it is still wide open for better opportunities ahead for New Crop.  We are currently targeting a more aggressive window of 720 – 800 to suggest advancing sales and move more New Crop inventory.

  • No new action is recommended for the 2024 crop at this time. Prices have rallied nicely off of lows to start the month of June. With continued Black Sea tensions July of 2024 futures prices should be able to build off of the recent lows. We are currently targeting the 750-775 area to advance further on sales.

Above: The market appears to have put in short-term lows to end the month of May near the 575 level. A close above the 660 area would be a supportive sign of a trend change to higher. The next area of possible support, if the late May lows do not hold, would be below the market near the September ’20 low of 533-1/4.  Resistance above the market could be found between 670 and 724.

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. Crop ratings overall are at historically low levels, and production concerns persist.  Additionally, any unforeseen geopolitical changes in the Black Sea region could cause the market to bounce and retrace 25% towards the 2022 high. 

  • 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: Last week Wednesday’s bullish reversal indicates that there is support near 760. US harvest selling pressure should keep upside limited to any near-term rallies. Resistance may be found above the market between 833 and 850, with further support resting below the market near 736-1/4. 

Mpls Wheat Action Plan Summary

  • No action is currently recommended for the 2022 crop.  With planting concerns and a seasonal tendency for old crop prices to increase over the next 4-5 weeks, we are continuing to wait for better prices to develop. The calendar is becoming a constraint though, and we’ll be looking to part with any remaining old crop bushels by mid-June or so. 

  • 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 pace has largely caught up to the 5-year average, dryness in some areas is increasing. With the market still largely oversold and a full growing season ahead of us, we are not looking to make any sales right now.

  • 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 July contract continues to be weak and showing signs of being oversold after breaking back below the 800 level this week.  With winter wheat harvest on the horizon, spill over selling pressure could plague the spring wheat market in the weeks to come. Resistance currently sits between 820 and 855 and then the recent high of 888-1/2.  Support below the market may be found between 770 and 760. 

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