Corn
Price action: July corn fell 1/4 cent to $4.90 and closed near the session low.
Fundamental outlook: Corn traded a fairly narrow range to kick off the week, with general selling across the marketplace setting a rather subdued tone. Old-crop corn futures were able to hold onto modest gains through much of the session, with support stemming from solid weekly export inspections for the week ended April 17, which were well above analysts’ pre-report range, despite declining 127,167 MT from the previous week.
Traders will be tuned in this afternoon for USDA’s weekly Crop Progress & Condition Report, which is expected to show corn plantings at 11% complete as of Sunday. If realized, it would be down a percentage point from last year.
U.S. weather continues to be mixed, though World Weather Inc states the weather pattern continues to advance more deeply into an active one. The forecaster anticipates rain in all crop areas in the Midwest, Great Plains, Delta and interior parts of the southeastern states over the next ten days to two weeks, with the Delta, Tennessee river basin and lower Midwest expected to face notable delays to fieldwork.
Technical outlook: July corn continue to face technical challenges at $4.93 1/4, though bulls continue to hold the near-term technical advantage and continue to look toward securing a close above $5.00 and then the Feb. 19 high of $5.21 1/2. Meanwhile, bears continue to look toward breaching support at $4.75, which is backed by the 200-day moving average of $4.59 1/2.
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 soybean futures closed 6 1/4 cents lower to $10.41 1/2 and closed near session lows. July meal futures sunk $2.80 to $300.30. July bean oil inched 3 points lower to 48.31 cents.
Fundamental outlook: Soybeans fell in tandem with the general marketplace today though did not deviate from the recent sideways trend. Soybeans held above last week’s low which will remain a key level this week. India and Japan have both referenced buying agricultural products as a part of trade negotiations, which has hardly been reflected in the marketplace. Concerns regarding the trade relationship with China and the lack of progress on that front continue to weigh on soy prices, limiting the upside of the recent rally and providing little catalyst to break out of the recent sideways range. Even so, the attention is quickly turning to planting and the delays popping up across the Midwest. A poll of analysts done by Bloomberg shows expectations of the soybean crop being 7% planted, up from 2% a week ago and about the same as last year.
USDA reported soybean export inspections of 550,924 MT (20.2 million bu.) for the week ended April 17, down 3,969 MT from the previous week but within the pre-report range of expectations from 400,000 to 750,000 MT. Accumulated inspections continue to be running ahead of pace, pointing to a potential beat of the current USDA export forecast. USDA continues to be a little pessimistic about exports given current trade relationships.
Technical outlook: July soybean futures continue to trade in an apparent bull flag on the daily bar chart, consolidating below stiff resistance at the psychological $10.50 mark. Bulls and bears are on an overall level playing field as prices have traded largely sideways since the beginning of March. The 10-day moving average, currently at $10.39 1/4, limited the downside today. A break below that mark would negate the bull flag, indicating a technical breakdown and would have bears targeting support at $10.29 1/4.
July meal futures struggled to garner any buying interest today. Stiff resistance at the 40-day moving average at $304.40 continues to limit the upside while staunch support at the psychological $300.00 mark has limited the downside. A daily close outside of those levels will likely determine the medium term direction, though a continued ping-pong between those levels seems likely.
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 wheat fell a dime to $5.52 1/4 and nearer the daily low. July HRW wheat lost 6 1/4 cents to $5.63 3/4, near the daily low. July spring wheat futures fell 5 1/4 cents to $6.14.
Fundamental analysis: The risk-off mentality in the general marketplace to start the trading week sent the grain market bulls to the sidelines today. The U.S. stock indexes melted down again today and if the strong selling pressure continues this week, it’s likely the grain markets will continue to see limited buying interest. Sharp losses in the U.S. dollar index today, which hit a three-year low, did somewhat limit selling interest in wheat markets.
USDA this morning reported U.S. wheat export inspections of 510,250 MT for the week ended April 17, down 101,196 MT from the previous week but above pre-report expectations.
Weather conditions in U.S. wheat country lean bearish now. World Weather Inc. today said that in U.S. HRW country soil and crop conditions in the next two weeks “will improve for the region. Shower and thunderstorm activity will occur frequently and temperatures shouldn’t be too extreme. There will be warmer-biased days, but enough cooler days too that will help balance it out to some extent.” The distribution of rainfall in far western areas will need to be closely monitored as some fields keep some moisture deficits, but most of the region should see better conditions for winter wheat development.
Meantime, in the northern Plains, crop and field conditions in the next seven days “will improve as precipitation falls across most of the region. The precipitation will help increase topsoil moisture and provide a better environment for crop development. Near to below average temperatures will keep evaporation rates low and help conserve soil moisture,” said World Weather.
This afternoon’s weekly USDA Crop Progress report is expected to show the U.S. winter wheat crop in 47% good to excellent conditions as of Sunday, the same as last week and compares to 50% in the same categories last year at the same time. The spring wheat crop is estimated to be at 14% planted as of Sunday, compared to 7% from the week prior and 15% from the same time one year ago.
Technical analysis: Winter wheat bears have the overall near-term technical advantage. However, recent price action suggests market bottoms are in place. SRW bulls’ next upside price objective is closing July prices above solid chart resistance at the April high of $5.71. The bears’ next downside objective is closing prices below solid technical support at the contract low of $5.32 1/2. First resistance is seen at today’s high of $5.66 1/2 and then at $5.71. First support is seen at $5.50 and then at $5.44 3/4.
HRW bulls’ next upside price objective is closing July prices above solid chart resistance at the April high of $5.89 1/2. The bears’ next downside objective is closing prices below solid technical support at the contract low of $5.50 1/2. First resistance is seen at today’s high of $5.75 and then at $5.89 1/2. First support is seen at $5.57 and then at $5.50 1/2.
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 31 points to 66.82 cents, a near mid-range close.
Fundamental outlook: Cotton futures retreated below technical support to begin the week, with tumbling crude oil and equities negating an extended plummet in the U.S. dollar. Risk aversion was broadly featured across the marketplace as economic unknowns continued to lurk. President Trump’s recent call for rate cuts amid Fed Chair Jerome Powell’s firm stance has exacerbated lingering recessionary concerns with traders uneasy about the Fed’s credibility and independence being called into question. Traders are pricing in at least three interest rate cuts in the U.S. this year, New York Fed President Bill Dudley recently indicated that policymakers will likely move slower than anticipated as current trade policies are stirring inflationary conditions.
USDA will update its estimates for planting progress in its weekly Crop Progress Report this afternoon. Last week, cotton plantings were estimated to be 5% complete, three percentage-points behind the five-year average. Excessive soil moisture in the Delta, which is expected to prevail, could keep progress minimal throughout the area, while South Teas and the Texas Coastal Bend should receive limited rain, allowing for continued progress. West Texas is expected to receive needed rain mid-week and over the weekend.
Technical outlook: July cotton futures failed a test of the 40-day moving average, currently trading at 67.14 cents and ended the session back below the 20-day, at 67.00 cents. Initial support will now serve at the 10-day moving average of 66.63 cents, which is backed by support at 65.91 cents and 65.57 cents. Meanwhile, the 20- and 40-day will be backed by resistance at 67.47 cents and 67.81 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.