Grain Market Insider: October 2, 2023
All prices as of 2:00 pm Central Time
| Corn | ||
| DEC ’23 | 488.75 | 12 |
| MAR ’24 | 503.75 | 12 |
| DEC ’24 | 517.25 | 10 |
| Soybeans | ||
| NOV ’23 | 1277 | 2 |
| JAN ’24 | 1296.75 | 2.25 |
| NOV ’24 | 1267.5 | 7.5 |
| Chicago Wheat | ||
| DEC ’23 | 564.75 | 23.25 |
| MAR ’24 | 596 | 22.5 |
| JUL ’24 | 631 | 18.75 |
| K.C. Wheat | ||
| DEC ’23 | 676.75 | 13 |
| MAR ’24 | 684.5 | 12.25 |
| JUL ’24 | 692.25 | 11.75 |
| Mpls Wheat | ||
| DEC ’23 | 718.75 | 9.5 |
| MAR ’24 | 741.5 | 8 |
| SEP ’24 | 781.5 | 6 |
| S&P 500 | ||
| DEC ’23 | 4302 | -23.5 |
| Crude Oil | ||
| DEC ’23 | 87.01 | -1.79 |
| Gold | ||
| DEC ’23 | 1846.6 | -19.5 |
Grain Market Highlights
- Despite tepid exports, the corn market regained its strength today following supportive stocks numbers from Friday’s USDA report and a strong wheat market.
- Again, caught between sharply higher soybean oil and sharply lower soybean meal, the soybean market settled the day only moderately higher, with export inspections at the upper end of expectations, and stronger wheat and corn markets lending additional support.
- Soybean oil was sharply higher with strength coming from reports that 22/23 soybean oil usage for biofuel was up 19% from last year, to 10.086 bil. lbs., versus a USDA forecast of a 14% increase.
- The wheat complex staged a large comeback following Friday’s much higher than expected production estimate from the USDA. The rally, led by the Chicago contracts, was likely technical in nature as traders may have covered short positions with the USDA’s quarterly stocks number only slightly higher than expectations.
- The U.S. dollar made a fresh 10-month high supported by firming Treasury yields and weak EU economic data. While grain futures shrugged off the negative influence in today’s trade, the strong dollar does create headwinds for US commodities in the world export market.
- To see the current U.S. 5 day precipitation forecast, and the 6 – 10 day Temperature and Precipitation Outlooks from the NWS and NOAA, scroll down to the other Charts/Weather Section.
Note – For the best viewing experience, some Grain Market Insider content is best viewed with your phone held horizontally.
Corn
Action Plan: Corn
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Corn Action Plan Summary
- No new action is recommended for 2023 corn. The 2023 growing season has been marked with many challenges that whipsawed the market up and down in a 140-cent range. And while we are at the time of year when lows are often made, the market is still subject to many unforeseen influences that can move prices higher, like in 2020 when the market went on to test contract highs and beyond after hitting market lows before harvest. For now, after locking in gains from previously recommended purchased 580 puts, Insider is content to wait until later in the year (when markets tend to strengthen) before considering suggesting any additional sales. Insider is also monitoring the market for any re-ownership opportunities, should it experience an extended rally.
- No new action is recommended for 2024 corn. Like the 2023 corn market, prices for the 2024 crop have been dominated by volatility from slow exports and adverse growing conditions which led to a near 80 cent trading range during the summer months. Plenty of time remains to market the crop, and while demand continues to be slow, many uncertainties remain that can move prices higher. After recommending an additional sale for the 2024 crop, Insider may not consider suggesting any further sales until later this winter or possibly even spring. We will continue to monitor the market for any upside opportunities in the coming weeks.
- No Action is currently recommended for 2025 corn. 2025 markets are very illiquid right now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
Grain Market Insider has issued the following number of corn recommendations:
• 2023: 1 Cash/2 Call/2 Put
• 2024: 2 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put
Market Notes: Corn
- The corn market shrugged off Friday’s weakness as it refocused on the friendly numbers in Friday’s USDA report. December corn settled back above the 20-day moving average, with additional strength gained from another flash sale to Mexico and a higher wheat market.
- On Friday’s Commitment of Traders report, managed money was holding a net short position of nearly 170,000 contracts, after selling just under 24,000. This was one of the largest short positions since late 2020.
- In a flash sale reported this morning by the USDA, Mexico stepped up to the plate again and purchased 210,000 mt (8 mb) of corn for the 23/24 marketing season. While exports remain sluggish overall, Mexico has been a main buyer.
- Weekly corn export inspections for the week ending Thursday, September 28, came in lower than the previous week at 626,000 mt, mid-range of what was expected by the trade, and still behind the export pace needed to reach the USDA’s target of 2.050 bb for the 23/24 season.
- Corn had a surprisingly negative reaction to Friday’s report, which showed September 1 stocks at 1.361 billion bushels, which was 78 mb below the September WASDE and 91 mb below last year’s stocks.
Above: The corn market has largely been rangebound since the beginning of August, with some minor short covering lifting prices in recent days. Resistance remains above the market between 495 – 516, and support below the market may be found near 460 and again near 415.
Corn Managed Money Funds net position as of Tuesday, Sept. 26. Net position in Green versus price in Red. Managers net sold 23,791 contracts between Sept. 20 – 26, bringing their total position to a net short 168,606 contracts.
Soybeans
Action Plan: Soybeans
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Soybeans Action Plan Summary
- No new action is recommended for 2023 soybeans. This season the market has experienced a lot of volatility, not only from USDA reports but also from changing weather patterns, crop conditions, and export sales. While export demand currently lags last year’s numbers, ending stocks are also currently estimated at a tight 220 million bushels. For now, Insider may not consider suggesting any additional sales until after harvest. Although, we will continue to monitor the market for any upside opportunities in the coming weeks.
- No action is recommended for 2024 crop. Grain Market Insider continues to monitor any developments for 2024 soybeans, and while it may be toward year’s end before we will consider recommending any 2024 crop sales, Insider will keep an eye out for any upside opportunities, should the market experience an extended rally.
- No Action is currently recommended for 2025 Soybeans. 2025 markets are very illiquid right now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
Grain Market Insider has issued the following number of soybean recommendations:
• 2023: 2 Cash/0 Call/0 Put
• 2024: 0 Cash/0 Call/0 Put
• 2025: 0 Cash/0 Call/0 Put
Market Notes: Soybeans
- Soybeans ended the day slightly higher after beginning the day lower on the heels of the quarterly Stocks report, which saw prices fall sharply on Friday. Soybean meal ended the day lower, but support came from significantly higher soybean oil.
- On Friday’s report, stocks were seen at 268 mb versus an expected 242 mb. This number still leaves stocks very tight, but was enough to cause funds to ramp up selling. Stocks are expected to remain tight as analysts begin to call yields closer to 49 bpa compared to the USDA’s guess of 50.1 bpa.
- A sale of 132,000 metric tons of soybeans was reported for delivery to China for the 23/24 marketing year. In addition to this, weekly inspections for soybeans came in at the higher end of expectations at 663,335 mt.
- The weekly Crop Progress report will be released later this afternoon and it is expected to show harvest between 26% and 28% complete, with both harvest and maturity ahead of the 5-year average. Conditions are expected to be called steady with most of the crop matured.
Above: Since the end of August, November soybeans have been in a downtrend and are showing signs of being oversold, which is supportive if prices do reverse higher. Above the market, initial resistance lies between 1317 – 1323, with further resistance near 1368. To the downside, support remains near the May 31 low of 1270.
Soybean Managed Money Funds net position as of Tuesday, Sept. 26. Net position in Green versus price in Red. Money Managers net sold 15,744 contracts between Sept. 20 – 26, bringing their total position to a net long 30,058 contracts.
Wheat
Market Notes: Wheat
- Wheat saw quite a comeback today after the negative close on Friday. The Chicago contract in particular posted double digit gains all the way out to May of 2025. This is also despite a new near-term high in the U.S. dollar, and negative close in Matif futures, which lost three Euros on the front month December contract.
- Weekly wheat export inspections for the week ending September 28 came in at 14.6 mb and bring the total 23/24 inspections number to 233 mb. So far, inspections are running behind the pace needed to meet the USDA’s export goal of 700 mb.
- While it is not fresh news, fundamental support may be coming from weather issues in other wheat growing regions of the world. Australia in particular is struggling with heat and dryness, with some analysts predicting a 30%-40% decline in their crop production.
- According to the Deputy Prime Minister of Ukraine, an additional five cargo ships are headed to Ukrainian ports to load with grain for export. Reportedly, about 120,000 mt of grain will be destined for Africa and Europe. In other Black Sea news, as reported by Interfax, Russia will increase their wheat export tax to 4,565 Rubles per ton, the equivalent of about $46.85.
- There was not much news to cause today’s rally, indicating that it was likely technical in nature. After Friday’s washout, wheat was quite oversold on some contracts and in need of a bounce. The question is, can this rally be sustained? Friday’s data painted a negative picture, that if true, could continue to pressure the market.
Action Plan: Chicago Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Chicago Wheat Action Plan Summary
- No new action is currently recommended for 2023 Chicago wheat. The wheat market in recent weeks has been sensitive to slow export demand, weather, and headlines regarding the Black Sea region. Now with harvest behind us, and new crop planting upon us, markets can still change suddenly due to El Nino and unforeseen geopolitical events, even though export demand remains weak. Following the recent recommendation to make an additional sale for the 2023 crop, Insider will continue to watch for any violations of support while also looking for prices to reach 650 – 700 before suggesting any further sales.
- No new action is recommended for 2024 Chicago wheat. Considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices, Insider recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. Plenty of time remains to market the 2024 crop with many uncertainties that could shock prices higher, like the world stocks to use ratio at an 8-year low, war in the Black Sea and production concerns in the southern hemisphere. If prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800, if not, and prices make new lows, unsold bushels will be protected by the recommended July ’24 590 puts.
- No action is currently recommended for 2025 Chicago Wheat. 2025 markets are very illiquid right now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
Grain Market Insider has issued the following number of Chicago wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 2 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put
Above: Chicago wheat broke out of its recent range to the downside following the September 29 grain Stocks report. Nearby support may be found between 524 – 533, while initial resistance above the market is near the low of the previous range, around 570.
Chicago Wheat Managed Money Funds net position as of Tuesday, Sept. 26. Net position in Green versus price in Red. Money Managers net bought 421 contracts between Sept. 20 – 26, bringing their total position to a net short 96,384 contracts.
Action Plan: KC Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
KC Wheat Action Plan Summary
- No new action is recommended for 2023 K.C wheat crop. Since the end of May, the wheat market has been influenced by weak demand, changing headlines from the Black Sea region, and the corn market with its own demand and weather concerns. With harvest in the bin, U.S. production has been better than expected and demand remains weak. Still, many supply questions remain unanswered from the Black Sea region and the southern hemisphere, which could push prices in either direction. While Insider will continue to monitor the downside for any breach of major support, we would need to see prices pushed toward 750 – 800 before considering any additional sales.
- No new action is recommended for 2024 K.C. wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for U.S. prices. Insider recently recommended buying July ’24 puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 660 puts, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.
- No action is currently recommended for 2025 KC Wheat. 2025 markets are very illiquid right now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
Grain Market Insider has issued the following number of K.C. wheat recommendations:
• 2023: 0 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put
Above: Since the beginning of September, the market has drifted sideways to lower. The recent breakout to the downside has Dec. K.C. wheat looking toward 630 and 575 for the next levels of support, while nearby resistance on the upside rests between 710 – 722.
K.C. Wheat Managed Money Funds net position as of Tuesday, Sept. 26. Net position in Green versus price in Red. Money Managers net sold 4,055 contracts between Sept. 20 – 26, bringing their total position to a net short 16,385 contracts.
Action Plan: Mpls Wheat
Calls
2023
No New Action
2024
No New Action
2025
No New Action
Cash
2023
No New Action
2024
No New Action
2025
No New Action
Puts
2023
No New Action
2024
No New Action
2025
No New Action
Mpls Wheat Action Plan Summary
- No new action is currently recommended for the 2023 New Crop. Weather has been a dominant feature this season with production concerns not only in the U.S., but also Canada and Australia. While prices have been weak due to low export demand, weather and geopolitical events can change suddenly to move prices higher. If prices begin to improve, Insider will consider making sales suggestions, while also continuing to watch the downside for any further violations of support.
- No new action is currently recommended for 2024 Minneapolis wheat. This year has been dominated by production concerns regarding the 2023 crop, and considering slow export demand and cheap Russian prices continue to be major headwinds for prices. Insider recently recommended buying July ’24 K.C. wheat puts to protect unsold grain if prices continue to retreat further. While war persists in the Black Sea region, production concerns continue in the southern hemisphere due to El Nino, and the world stocks to use ratio remains at an 8-year low. There are still many uncertainties that could shock prices higher, and plenty of time remains to market the 2024 crop. After recommending buying July ’24 K.C. wheat 660 puts for the liquidity and high correlation to Minneapolis wheat’s price movements, unsold bushels will be protected if prices make new lows, and if prices turn around and rally higher, Insider will be looking for opportunities to consider recommending additional sales north of 800.
- No action is currently recommended for the 2025 Minneapolis wheat crop. 2025 markets are very illiquid right now, and it may be some time before conditions are conducive to consider making any recommendations. Be patient as we monitor the markets for signs of improvement.
Grain Market Insider has issued the following number of Minneapolis wheat recommendations:
• 2023: 1 Cash/0 Call/0 Put
• 2024: 1 Cash/0 Call/1 Put
• 2025: 0 Cash/0 Call/0 Put
Above: Since early September, Dec. Minneapolis wheat has been largely rangebound, and the recent breakout to the downside, and Sept. 29 push lower has the market poised to test support near the May ’21 low of 665. If prices turn higher, initial resistance may be found between 745 – 760.
Minneapolis Wheat Managed Money Funds net position as of Tuesday, Sept. 26. Net position in Green versus price in Red. Money Managers net sold 480 contracts between Sept. 20 – 26, bringing their total position to a net short 15,657 contracts.
Other Charts / Weather
