Grain Market Insider: October 9, 2023
All prices as of 2:00 pm Central Time
| Corn | ||
| DEC ’23 | 488.25 | -3.75 |
| MAR ’24 | 503.75 | -3.5 |
| DEC ’24 | 516.25 | -3.25 |
| Soybeans | ||
| NOV ’23 | 1264.25 | -1.75 |
| JAN ’24 | 1282.5 | -2 |
| NOV ’24 | 1250.5 | -5 |
| Chicago Wheat | ||
| DEC ’23 | 572.75 | 4.5 |
| MAR ’24 | 603.5 | 5.5 |
| JUL ’24 | 640.75 | 6.75 |
| K.C. Wheat | ||
| DEC ’23 | 686 | 12.25 |
| MAR ’24 | 694.75 | 12 |
| JUL ’24 | 704.25 | 12 |
| Mpls Wheat | ||
| DEC ’23 | 731 | 10.5 |
| MAR ’24 | 755.25 | 10.25 |
| SEP ’24 | 791.75 | 9.75 |
| S&P 500 | ||
| DEC ’23 | 4371.5 | 30 |
| Crude Oil | ||
| DEC ’23 | 84.71 | 3.43 |
| Gold | ||
| DEC ’23 | 1868.5 | 23.3 |
Grain Market Highlights
- Carryover strength from higher wheat and crude oil on Mid-East geopolitical concerns, gave way to choppy trade and harvest pressure in the corn market as the day wore on, with December corn closing near the bottom of its range.
- Choppy trade dominated the soybean market that settled mid-range and lower on the day in the November contract as weakness from sharply lower soybean oil outweighed overnight strength and higher meal prices.
- Despite sharply higher crude oil prices, soybean oil succumbed to technical selling as the December contract broke to its lowest prices in three months. Today’s weakness not only pressured soybeans but also Board crush margins, which lost 8 ½ cents in the December contracts.
- In addition to the uncertainty surrounding less-than-ideal growing conditions in the southern hemisphere, rising geopolitical tensions in the Black Sea, and now the Middle East, supported the wheat complex which traded higher through the day after Chicago and K.C. gapped higher on the open Sunday night.
- Before retreating from its highs in the day session, the U.S. Dollar was jolted higher overnight in a flight to quality trade from the geopolitical uncertainty generated in the Middle East from the Hamas attacks on Israel over the weekend. In recent weeks, the dollar’s resurgence has added headwinds to U.S. exports by making them more expensive on the world market.
- To see the current U.S. 3 – 4 week Temperature and Precipitation Outlooks from NOAA, scroll down to other Charts/Weather Section.
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Corn
Action Plan: Corn
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No 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
- Corn futures were very choppy throughout the day after losing overnight strength, closing 3 ¾ cents lower on the session. Middle East geopolitical tensions and harvest pressure limited any rallies in the corn market today.
- Geopolitical concerns in the Middle East with the Israeli-Hamas war occurring over the weekend brought a lot of volatility and nervous trade to the marketplace. A strong move higher in crude oil prices supported the grain markets, but that was replaced by a general “risk-off” trade in commodities on the day.
- Harvest pressure remains a constant in the corn market as harvest ramps up. Due to the Columbus Day holiday, the USDA will not release crop progress pace until Tuesday afternoon. Weather this week looks friendly to keep harvest moving until a rain system moves in towards the end of the week.
- The corn market lacked any news on the session as the Columbus Day holiday paused Export Inspections report, Crop Progress report, or any potential export sales from over the weekend. Those reports and information will be released tomorrow.
- The market will likely stay choppy this week as the market prepares for the USDA WASDE report on Thursday, October 12. Expectations are for production to decrease slightly.
- Managed money continues to hold a large net short position in the corn market. On Last week’s Commitment of Trader’s report, funds were net short 159,433 contracts of corn.
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 490 – 516, and support below the market may be found near 460 and again near 415.
Soybeans
Action Plan: Soybeans
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No 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 lower after opening higher. The weekend news regarding Israel declaring war on Hamas, and Iran reportedly backing the attack, sent crude oil higher and initially brought most commodities higher as well, but they faded throughout the day. Additionally, soybean meal ended higher while soybean oil closed lower.
- This Thursday, the USDA WASDE report will be released, and early estimates are calling for soybean yields to be lowered slightly to 49.9 bpa from 50.1 bpa in last month’s report. Production is estimated to come in at 4.134 billion bushels, slightly below last month’s USDA estimate.
- In Brazil, soybean supplies are reportedly getting thin and could open up significant export opportunities for the U.S. for October and November out of the PNW. The U.S. is currently the only offer for that time frame.
- Brazil’s 23/24 soybean crop is now 10.1% planted, which is up 4.8% from the previous week. Planting is also going more slowly than expected in Brazil, as the Northern and Central regions deal with dryness, and the Southern regions deal with too much moisture.
Above: The soybean market remains in a downtrend and is oversold, which is supportive if prices turn back higher. Resistance above the market lies between 1285 – 1323. Initial support to the downside lies near 1238 – 1214, with further key support down near 1181.
Wheat
Market Notes: Wheat
- The wheat market received a boost today as the trade added more war premium. Along with new Russian attacks on Odessa, over the weekend there was also some uncertainty in the Middle East. Hamas attacked Israel with missiles, and Iran is also said to be involved. Given that wheat is a staple in this region, it sparked a reaction from the market. As an aside, the Hamas attacks also sent crude oil sharply higher due to concern about production out of that part of the world.
- Globally there are growing concerns for multiple wheat producers. Western Australia is facing drought, and in Argentina, some analysts are projecting a wheat crop of 15 mmt or less; the USDA is estimating 16.5 mmt currently. Because of this, it is being said that Argentina’s farmers are selling wheat at the slowest pace in seven years.
- In the face of danger from Russia, 12 ships are said to be waiting to enter Ukraine’s humanitarian corridor to transport grain. Although, Russia remains the dominant wheat exporter, with IKAR estimating their exports at 64.5 mmt of grain, compared with 64.0 mmt previously. In addition, they also increased their estimate of Russian grain production by 1.2 mmt to 141.2 mmt.
Action Plan: Chicago Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No 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: Following the September 29 Grain Stocks report, the December contract broke out of its previous range to the downside and has since rallied back. That previous range of 570 – 618 is an area of resistance which the market will need more bullish input to rally through. If it cannot, support below the market resides between 533 – 524.
Action Plan: KC Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No 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.
Action Plan: Mpls Wheat
Calls
2023
No Action
2024
No Action
2025
No Action
Cash
2023
No Action
2024
No Action
2025
No Action
Puts
2023
No Action
2024
No Action
2025
No 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 on September 29 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.
Other Charts / Weather
