By MATT PIKE
St. Joseph Post
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GENERAL COMMENTS:
July corn closed down 8 1/2 cents and December corn was down 3 cents. July soybeans closed down 14 cents and November soybeans were down 13 1/4 cents. July KC wheat closed up 3/4 cents, July Chicago wheat was up 1 3/4 cents, July MIAX Minneapolis wheat was up 7 cents.
The U.S. Dollar Index is up 0.42 at 99.94. The Dow Jones Industrial Average is down 114.0 points at 42,296.0. June gold is up $0.20 at $3,300.60, July silver is down $0.14 at $33.18 and July copper is down $0.0590. July crude oil is up $0.86 at $61.75, July ultra-low sulfur diesel is up $0.0136, July RBOB gasoline is up $0.0076 and July natural gas is down $0.171.
CORN:
July corn futures traded 8 1/2 cents lower Wednesday, finishing at $4.51. New-crop December futures were down 3 cents to $4.43 1/2. The corn market struggled to find any footing on Wednesday as recent buyers who entered the market last week are seemingly exiting positions for a quick profit, driven by mostly steady planting pace for corn, and a strong first crop condition reading in Tuesday's Crop Progress report from USDA.
In Tuesday's report, USDA pegged U.S. corn plantings at 87% complete versus the five-year average of 85%. Planting pace did slow slightly, with the lead over the five-year pace narrowing over the past week. Notably, Illinois, Indiana, and Kentucky remain behind normal pace due to heavy rainfall throughout the past few weeks. These states still have time ahead of the start of the late planting window on June 5 but depending on how these next few weeks go weather-wise, the door remains open in my view to potentially see a shift back toward soybean acreage in late states. The market may have been in agreement with this opinion Wednesday, as new-crop November soybeans dropped 13 1/2 cents relative to December corn's 3-cent drop. For corn conditions, USDA found in their first reading Tuesday that 68% of the U.S. corn crop is in good-to-excellent condition. This was perhaps a touch lower than many were expecting but, overall, not enough to spark much in the way of a bullish rally.
Looking at the December corn chart, Wednesday was a disappointing technical day for prices, as prices again failed at the 50-day moving average ($4.49 1/2) and the 20-day moving average at $4.44 1/2 also failed to hold in the afternoon. $4.40 is the next immediate support point, otherwise the 2025 low of $4.34 1/2 remains in play.
The DTN National Corn Index finished Tuesday at $4.35. Wednesday's futures close and implied corn basis of 25 cents under the July board would indicate the index on Wednesday afternoon to be near $4.25.
SOYBEANS:
July soybean futures fell 14 cents Wednesday to $10.48 1/2. Meanwhile, new-crop November soybeans were down 13 1/4 cents to $10.37 1/2. The soybean complex as a whole was lower Wednesday, led by soybean oil which dropped 0.64 cents per pound but did find support near 48.58, trendline support which has caught prices on two breaks through the latter half of May. General nervousness regarding the budget bill as it works its way through the U.S. Senate seemed to be the primary source of weakness to soybean oil prices for Wednesday.
In Tuesday's Crop Progress report, USDA said U.S. soybean planting was 76% complete as of May 25, still 8 points ahead of the five-year average. Ohio, Kentucky, and Mississippi stand out as states currently behind average pace. The seven-day forecast continues to show widespread precipitation across the U.S. Grain Belt, with parts of Illinois, Indiana, and Ohio in particular slated to receive 1 to 2+ additional inches of rain.
Looking at the November soybean futures chart for Wednesday, prices closed below the 20-day moving average ($10.38 1/4) for the first time since May 8. Support is stacked just above $10.30 in the form of the 100- and 200-day moving averages, while the 50-day moving average waits just below at $10.25 3/4.
The DTN National Soybean Index finished Tuesday at $10.12. Wednesday's futures close and implied soybean basis of 50 cents under the July board would indicate the index on Wednesday afternoon to be near $9.98.
WHEAT:
July Kansas City wheat closed up 3/4 cents to $5.25 1/4 on Wednesday. Chicago wheat futures were also marginally higher while MIAX Minneapolis spring wheat futures led the charge higher, closing up 8 1/2 cents on July futures following a poor initial condition reading from USDA on Tuesday.
U.S. spring wheat condition was reported on Tuesday to be 45% good to excellent across the six major growing states. Top-producing North Dakota in particular posted the third lowest initial crop rating since the series began in 1986. 2021 stands out as one of the years which began with an even lower good-to-excellent rating than the 34% reported for North Dakota's crop in Tuesday's release. Heavy rainfall and cooler-than-average temperatures can be attributed to the slow start for spring wheat conditions. MIAX Minneapolis futures as a result extended their gains above KC and Chicago varieties on Wednesday, trading 6 cents higher on the September contract in what has turned into a choppy back-and-forth action for spring wheat prices over the past handful of sessions.
For the U.S. winter wheat crop, conditions again dropped week-over-week from 52% good to excellent to 50% in Tuesday's report. Nebraska led the way with a sharp 9-point drop in good-to-excellent ratings and a subsequent 12-point increase in poor-to-very-poor conditions as 53% of the states' wheat crop is now rated poor to very poor. It will be interesting to see if recent rainfall as well as chances over the next week will reverse fortunes there. Meanwhile, Kansas and Oklahoma are also slated to receive more rainfall over the next week. This may be welcome in parts of Kansas, but I would think the potential for too much moisture in Oklahoma may be possible after what has been an extremely wet last couple of months for the central and eastern parts of the state specifically. Finally, in international news, winter wheat prices may have been partially pressured by the International Grains Council increasing their estimate for Russian production to 81.7 million metric tons (mmt), joining USDA as well as SovEcon in estimating the crop higher than what was originally thought would be the case in early 2025.
Looking at the September MIAX Minneapolis wheat chart, prices stalled in their rally Wednesday at the 50-day moving average near $6.18 1/4, which has kept prices in check over the past five sessions. September Minneapolis futures have not sustained a move above the 50-day moving average since early in the year, and prices have subsequently failed at this level three times in the past three months.
The DTN National HRW Index finished Tuesday at $4.58, while the DTN National HRS Index was $5.73. Wednesday's futures close and the implied basis of 66 cents under the July for HRW, and 23 cents under the July for HRS, would indicate the indices for Wednesday afternoon to be near $4.59 and $5.82, respectively.