MarketEdge AM Comments

Jun 06, 2023

(Phil Knuth)

Good Morning.  Turnaround Tuesday.  Corn and soybean futures were higher overnight.  July corn finished the overnight session up 5 cents, settling at 6.0250.  July soybeans were up 3 cents, settling at 13.53.  In the outside markets, as of 7:45am:  The US Dollar Index is up 302 points, trading at 104.304.  July crude oil is off $1.54, trading at $70.61 per barrel.  Precious metals are higher, except platinum.  Industrial metals are all lower.  The Electronic Mini-DJIA is off 43 points, trading at 33,576.  Hot and dry weather across a large swath of the Corn Belt, lower than expected crop conditions ratings on yesterday afternoon’s Crop Progress and Conditions Report, and conflict escalation in Ukraine supported grain and oilseed futures overnight.  Aside from scattered showers, the Eastern Corn Belt is not forecasted to receive any meaningful rainfall until the 6-10 day timeframe.  The development of these showers is critical as the crop is certainly stressed.  In the 11-15 day window, above normal precipitation is currently forecasted, however, extended weather models are highly unreliable.  Until if and when this extended forecast delivers, traders are approaching with caution and weather remains a supportive topic.  Yesterday afternoon, USDA released the weekly Crop Progress and Conditions Report.  The national corn crop condition rating was lowered by 5 points from last week, to 64% good to excellent.  This figure is below what the trade had anticipated, is 11 points behind the five-year average, and is nine points below last year at this time.  The first national soybean crop condition rating of the growing season was announced yesterday.  The soybean crop was reported to be 62% good to excellent.  This figure is below the average trade estimate.  The wall of the important Kakhovka Dam on the Dnieper River in Southern Ukraine collapsed within the last 24-hours.  Not only will this dam failure cause flooding and displacement of residents, it threatens drinking water supplies and could impact operations at the world’s largest nuclear power plant that is downstream from the dam.  Both Russia and Ukraine are blaming each other for sabotaging the dam.  At this time, it is not clear who is really at fault as it does not directly benefit either side for the dam to collapse.  Yesterday, the funds sold 10,000 contracts of corn, sold 1000 contracts of soybeans, and bought 1000 contracts of wheat.  They are now estimated to be net short 49,850 contracts of corn, net long 11,240 contracts of soybeans, and net short 116,030 contracts of wheat.  From a chart perspective, July corn faces initial resistance at the psychological 6.00 mark, followed by the overnight high, 6.0950, and then the 1 ½ month high charted yesterday, 6.14.  Initial support lies at 5.95, yesterday’s low, followed by 5.7750, last Wednesday’s low, and then the 5.50 area.  July soybeans face initial resistance at the overnight high and yesterday’s high, 13.61 and 13.6150, respectively, followed by the psychological 14.00 level.  Initial support lies at 13.51, the overnight low, followed by the psychological 13.00 mark, and then the 16-month low charted on Wednesday, 12.7075.  Opening calls are higher.
Have a great Tuesday.

Read More News

Jun 30, 2023
September corn closed down 35 cents at 4.8850 and December corn closed down 33 ¾ at 4.9475.
Jun 30, 2023
​Good Morning.  It is Report Day.  At 11am, USDA will release the highly anticipated Quarterly Stocks and Acreage Reports.
Jun 28, 2023
Grains continue their free fall today with rain continuing to fall and/or be forecasted for parts of the corn belt most needing a drink.