Corn
Price action: July corn fell 6 1/4 cents to $4.49 1/4, closing near the session low.
Fundamental analysis: Bear spreaders showed up again today, with old-crop futures retreating from overnight highs while new-crop futures firmed modestly. Meanwhile, outside markets were not a source of optimism as crude oil eventually faced resumed selling while the U.S. dollar firmed.
Overnight short-covering transpired amid reports Treasury Secretary Scott Bessent and U.S. Trade Representative Jamison Greer will meet China’s economic leader He Lifeng in Switzerland this weekend, which could mark the first step in resolving the trade war. However, no major breakthroughs are expected.
Also supportive was a statement from Mexico’s Agriculture Minister Julio Berdegue indicating he had reached an agreement with USDA Secretary Brooke Rollins in a “friendly” meeting in Washington. Berdegue did not elaborate in his post on X, but said the deals would benefit both countries.
Nevertheless, trade uncertainty continues to ring, as the marketplace weighs potential repercussions of recent rifts. Concrete details of recent trade deals will need to be confirmed sooner than later to ease current risk-off notions.
Earlier today the Energy Information Administration reported weekly ethanol production averaged 1.020 million barrels per day (bpd) during the week ended May 2, down 20,000 bpd (1.9%) from the previous week but 55,000 bpd above the same week last year. Ethanol stocks declined 198,000 barrels to 25.191 million barrels.
Technical analysis: July corn futures ended the session on the daily low as bears tighten their grip on the near-term technical advantage. The camp is seemingly poised to take out the late November low of $4.36 3/, though support will serve at today’s low of $4.48 1/2, then at the Dec. 19 low of $4.45 3/4. Meanwhile, bulls will look towards the mid-April high of $4.97 1/2, though initial resistance stands at the the 200-, 10-, 40- 20- and 100-day moving averages, layered from $4.61 1/4 to $4.79 3/4.
Hedgers: You should be 70% sold in the cash market on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Cash-only marketers: You should be 70% sold on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Soybeans
Price action: July soybeans fell 2 cents to $10.39 1/4 and near the daily low. July soybean meal rose $2.00 to $295.00 and nearer the daily high. July soybean oil fell 102 points to 47.33 cents, near the daily low and hit a three-week low.
Fundamental analysis: The soybean and bean oil futures markets lost their overnight gains that were inspired by initial optimism regarding a U.S.-China trade meeting in the coming days. U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer will meet China’s economic leader He Lifeng in Switzerland this weekend for talks that could be a first step toward resolving the trade war. Soybeans and bean oil prices lost altitude during the day session as no major breakthroughs in the trade talks are expected. A higher U.S. dollar index and lower crude oil prices today were bearish outside market forces working against the soybean bulls at mid-week.
World Weather Inc. today said “mostly dry and improving to favorable conditions for fieldwork continued in much of the U.S. Midwest Tuesday, with exceptions from most of Michigan to much of Ohio where rain fell.” Outside of rain in a large part of the lower Midwest into Thursday, dry weather will be most common through early next week and planting should advance well before rain returns to much of the region May 14-16, “with the moisture timely in many areas and especially in the drier areas of the west-central and northwestern Corn Belt.” Soil moisture is already low from the eastern Dakotas and northeastern Nebraska to western and central Minnesota and with warm temperatures expected. “The next rain May 14-16 will be important in improving conditions for crop germination and establishment. Notable declines in topsoil moisture will occur elsewhere across the Midwest by early next week and although soil moisture will still be favorable in much of the region, rain May 14-17 will help to ensure favorable soil conditions continue deeper into the month,” said World Weather.
Thursday morning’s weekly USDA export sales report is expected to show U.S. soybean export sales of 200,000 to 500,000 MT in the 2024-25 marketing year, and sales of zero to 150,000 MT in the 2025-26 marketing year.
Technical analysis: The soybean bulls have the slight overall near-term technical advantage but need to show fresh power soon to keep it. The next near-term upside technical objective for the soybean bulls is closing July prices above solid resistance at the April high of $10.67 1/2. The next downside price objective for the bears is closing prices below solid technical support at $10.00. First resistance is seen at this week’s high of $10.57 and then at $10.67 1/2. First support is seen at this week’s low of $10.36 1/2 and then at $10.25.
Soybean meal bears have the firm overall near-term technical advantage. Prices are in a downtrend on the daily bar chart. The next upside price objective for the meal bulls is to produce a close in July futures above solid technical resistance at the April high of $308.10. The next downside price objective for the bears is closing prices below solid technical support at the contract low of $289.70. First resistance comes in at this week’s high of $299.00 and then at $300.00. First support is seen at this week’s low of $292.60 and then at $289.70.
July soybean oil today scored a bearish outside day down. Bean oil bulls still have the overall near-term technical advantage. The next upside price objective for the bean oil bulls is closing July prices above solid technical resistance at the April high of 51.13 cents. Bean oil bears’ next downside technical price objective is closing prices below solid technical support at the April low of 44.25 cents. First resistance is seen at 48.00 cents and then at 49.00 cents. First support is seen at 47.00 cents and then at 46.00 cents.
What to do: Get current with advised sales. Our next sales target is $11.00 in nearby futures.
Hedgers: You should be 55% sold in the cash market on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Cash-only marketers: You should be 55% sold on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Wheat
Price action: July SRW futures closed 1 3/4 cents lower to $5.34 1/4 and closed near session lows. July HRW futures plunged 8 1/2 cents to $5.29 1/2, near session lows. July spring wheat futures fell 7 1/2 cents to $6.03.
Fundamental analysis: Wheat futures saw impressive gains overnight but struggled to maintain strength as the session went on. Bulls struggled to find footing despite reports from an Oklahoma winter wheat crop tour that estimated winter wheat production at 101.169 million bu. with an average yield of 35.9 bu. per acre. That is down from a year ago despite relatively favorable weather this spring. The tour noted some regions had become too wet and some disease pressure is likely. Some precipitation is expected across HRW acres today and conditions are expected to dry up until another series rolls through the Plains in about a week, says World Weather Inc. Meanwhile, the northern Plains are expected to be dry with temperatures that are well above normal, leading to net drying. The need for rainfall is growing in Montana and the central and western Dakotas, says the forecaster.
The Federal Reserve held rates steady today, as expected. The press release noted that inflation persists at somewhat elevated levels. The Fed also noted that the risks of higher unemployment and higher inflation have risen, as well as the uncertainty regarding the economic outlook for the U.S. This uncertainty has reduced speculation across the broader marketplace, leading to a reduction in speculative holdings, including wheat futures. Speculation has driven liquidity to the agricultural markets for decades and has become an integral part of the marketplace; anything causing traders to reduce risk and leave the market is generally not a good sign. This helps explain the divergence of global fundamentals and price in the last couple of months.
USDA will release its weekly export sales report tomorrow morning. Analysts anticipate sales between -100,000 and 150,000 MT for 2024-25 (which ends at the end of the month) and 200,000 and 400,000 MT for 2025-26. Last week, sales totaled 72,005 MT for 2024-25 and 238,300 MT for 2025-26.
Technical analysis: July SRW futures saw a disappointing day of price action that closed prices right on uptrend support. Bears continue to hold the near-term technical advantage. Support comes in at $5.34 on tonight’s open, with followthrough selling finding support at $5.28 1/4 then the contract low of $5.23 1/4. Resistance comes in at $5.37 1/4 then the 20-day moving average at $5.43, which capped today’s rally.
July HRW futures led weakness today, further cementing bears’ hold of the technical advantage. Support comes in at the contract low of $5.25 on continued selling pressure, which is backed by tentative support at $5.20. Resistance stands at the 10-day moving average at $5.39 then today’s high of $5.45 on corrective buying.
What to Do: Get current with advised sales.
Hedgers: You should be 85% sold in the cash market on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 85% sold on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cotton
Price action: July cotton fell 45 points to 67.38 cents and near the session low.
Fundamental analysis: The cotton futures market bulls and bears continue to battle in a choppy and sideways trading affair, with neither side gaining much traction recently. A firmer U.S. dollar index and lower crude oil prices today did limit buying interest in cotton futures. Losses in cotton were somewhat limited by a rally in the U.S. stock indexes.
Cotton prices seemingly brushed aside news that U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer will meet China’s economic chief He Lifeng in Switzerland this weekend for talks that could be the first step toward resolving the trade war. Cotton market traders apparently reckon no major breakthroughs will occur this weekend.
World Weather Inc. today said west Texas planting prospects “have improved due to recent rain.” Some fieldwork will be accelerated in the coming week with the next best chance for rain coming in about 10 days. South Texas and the Texas Coastal Bend will receive some rain in the next couple of days. However, net drying will be quick to resume this weekend and continue into next week. Field conditions in the Delta had been improving recently, although rain Tuesday and that expected into the weekend will return a slower field-working pace for some areas. The southeastern corner of the U.S. will get some needed rain this weekend into next week improving the planting and establishment of cotton from Florida and southeastern Alabama through Georgia to South Carolina, said World Weather.
Cotton traders will closely examine Thursday morning’s weekly USDA export sales report, with bulls hoping for better U.S. cotton sales abroad. Cotton traders are also awaiting next Monday’s monthly USDA supply and demand report, which will provide updates to the agency’s balance sheet for cotton.
Technical analysis: July cotton prices scored a bearish outside day down today. The cotton bulls and bears are on a level overall near-term technical playing field. The next upside price objective for the cotton bulls is to produce a close in July futures above technical resistance at 70.00 cents. The next downside price objective for the cotton bears is to close prices below solid technical support at the May low of 65.53 cents. First resistance is seen at 68.00 cents and then at 68.50 cents. First support is seen at 67.00 cents and then at 66.50 cents.
What to do: Get current with advised sales and hedges.
Hedgers: You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.