Corn
Price action: July corn futures fell 5 1/2 cents to $4.42 1/2, near mid-range and hit a seven-month low.
Fundamental analysis: The corn futures market continues to slump amid good growing conditions in the U.S. Corn Belt and no threatening weather in the forecast. Solid losses in the U.S. dollar index today and good gains in crude oil provided little help to the corn market bulls today. Neither did a risk-on trading day in the general marketplace that saw the U.S. stock indexes hit 2.5-month highs.
Bear spreading has been featured in corn recently, whereby traders sell the nearby contract and buy the deferreds. July futures are now trading only 1 1/2 cents above new-crop December corn.
USDA Monday afternoon reported U.S. corn plantings advanced to 62% complete as of Sunday, ahead of the five-year average of 56%. World Weather Inc. today said “excessive heat in the north-central U.S. is drying soil very quickly, but rain is expected later this week and into next week in some of the driest areas. All U.S. crop areas will get rain eventually with drought relief likely in the southeastern states.”
Argentina corn regions “will see a favorable mix of weather, although some harvest delay is possible late this week due to rain.” Center-west and center-south Brazil will experience net drying conditions for a while, although some rain fell in southern Safrinha corn areas during the weekend, said the forecaster. Pro Farmer South American crop consultant Michael Cordonnier raised his Brazilian corn production forecast 1 MMT, to 127 MMT, noting favorable yields and increased harvested area. Cordonnier also raised his Argentine corn crop estimate 1 MMT to 50 MMT.
Technical analysis: The corn futures bears have the firm overall near-term technical advantage as prices are in a four-week-old downtrend on the daily bar chart. The next upside price objective for the bulls is to close July prices above solid chart resistance at $4.60. The next downside target for the bears is closing prices below chart support at last summer’s low of $4.21 3/4. First resistance is seen at today’s high of $4.48 and then at $4.50. First support is seen at today’s low of $4.36 1/2 and then at $4.30.
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 rose 1 1/4 cents to $10.72 1/2, an 11-week high close, while July soymeal forged a low-range close, plunging $4.80 to $293.30. July soyoil rallied 156 points to 51.48 cents, which is the highest close since Oct. 16, 2023.
Fundamental analysis: A soyoil rally was a post-report benefactor for soybean futures, lifting prices from their morning low. While an inside range was held early on, today’s price action was certainly profound, ultimately featuring a fresh for-the-move high, as bulls defended their near-term technical advantage. However, soymeal held a downtrodden tone as technical pressure kept buyer interest to a minimum.
USDA reported soybean plantings had advanced 18 points to 48% complete as of Sunday, well ahead of the five-year average of 37%. Of the top 13 production states, Indiana and Michigan were the only states that were behind average, with the Dakotas, Minnesota and Iowa leading the charge. Not surprisingly, emergence was also six points ahead of average at 17%.
World Weather Inc. cites excessive heat in the north-central U.S., which has allowed for swift plantings, is drying soil very quickly. Rain is expected later this week and into next week in some of the driest areas, easing some concerns. The forecaster also notes all U.S. crop areas will get rain eventually with drought relief likely in the southeastern states, while the Delta will remain a little too wet.
Technical analysis: July soybeans notched the highest close since Feb. 21, with technical support at the 20-, 10-, 200- 100- and 40-day moving averages, layered from %10.51 1/2 to $401.38 3/4 continue to ward off bear efforts. Bulls will now look toward securing a close above $11.00, though initial resistance serves at $10.79 3/4, $10.88 1/2. While today’s high-range close indicates bulls are poised to work higher, a push into overbought territory could result in a pause before buyers resume.
July soyoil marked the highest close since October 2023, bolstered by solid technical support at the 10- and 20-day moving averages, trading at 49.09 cents and 48.97 cents. However, bull efforts will continue to face a battle at 51.63 cents and 52.62 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 2 cents higher at $5.17 1/4, nearer session highs. July HRW climbed 3 3/4 cents to $5.11 3/4, nearer session highs. July HRS futures fell 3 1/4 cents to $5.80 3/4.
Fundamental analysis: Wheat futures made contract lows in the overnight session before rebounding somewhat during today’s session. Selling was featured across the grain and soy markets overnight, but soybeans rebounded during today’s session, helping pull wheat higher. The stock market surged higher today as well as the S&P made fresh highs on the year. Still, yesterday’s reports sent a fresh wave of pessimism around the marketplace that has been difficult to shake for wheat bulls. While USDA was rather optimistic on their export forecasts for corn, soybeans and cotton, they actually anticipate wheat exports falling in 2025-26 from this 2024-25. Wheat exports have rebounded this year amid a tightening world balance sheet with shipments even remaining strong the past couple of weeks amid heightened trade tensions. USDA doubled their import forecast for China, despite also having a higher production forecast for the country, despite drought impacting key growing areas. It is apparent that they do not anticipate they import demand going to the U.S., but it will be picked up somewhere. Not to mention, USDA increased their import forecast for Mexico from 5.7 MMT to 6.5 MMT, nearly 30 million bu., which is likely to be sourced from the U.S. We are more optimistic on trade, but even if exports come in higher than where USDA is, stocks will remain abundant.
HRW acres are expected to be hot and dry over the next couple of weeks, but favorable soil moisture should be able to support crop conditions, says World Weather Inc. The northern Plains are expected to receive some much needed precip in the coming week as well. USDA rated the winter wheat crop 54% “good” to “excellent” and 11% “poor” to “very poor.” On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop improved 1.3 points to 328.6, despite a decline in top producer Kansas. The SRW crop improved 5.6 points to 374.9, despite a decline in top producer Illinois. Click here for full details.
Technical analysis: Winter wheat futures saw modest profit-taking today though bears continue to retain the technical advantage in both markets. July SRW bulls are seeking to build on today’s gains and overcome psychological resistance at $5.25, which is quickly backed by the 10-day moving average at $5.27 3/4. Until bulls close prices above the 20-day, currently at $5.35 1/4, bears will retain full control of the technical edge. Support comes in at $5.15 1/4 then today’s contract low of $5.06 1/4.
July HRW futures continue to lead weakness. Bulls are eyeing resistance at $5.17 1/2 before tackling the 10-day moving average at $5.25 1/2. Support comes in at yesterday’s contract low close of $5.08 then today’s contract low of $5.00 1/4 on continued selling pressure.
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 35 points to 66.28 cents, the lowest close since May 1.
Fundamental analysis: Cotton futures edged lower in consolidative trade as technical selling continued to pressure prices. USDA reported cotton plantings advanced seven points last week to 28% complete as of Sunday, which was three points behind the five-year average. Plantings stood at 27% in Texas (29% average) and 24% in Georgia (28%).
World Weather Inc. notes planting prospects have improved in West Texas due to recent rain, though more is needed, especially in dryland areas. Some fieldwork will be accelerated in the coming week though warmer temps will begin depleting soil moisture. South Texas and the Texas Coastal Bend received some much needed rain late last week, but a return of dry weather has since evolved and will persist for at least the next ten days. Meanwhile, field conditions in the Delta are a little too wet and drying will be interrupted periodically by more rain in the next ten days. The southeastern corner of the U.S. is getting 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.
Technical analysis: July cotton faced pressure from the 10-, 40-, 20- and 100-day moving averages, layered from 67.01 cents to 68.27 cents, while initial support continues to serve at 65.84 cents. Bulls will need to overcome the April 25 high of 69.75 cents to regain the technical advantage, while bears will look towards securing a close below the April 4 low of 62.05 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.