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GENERAL COMMENTS:
July corn closed down 3 cents and December corn was down 4 3/4 cents. July soybeans closed down 12 cents and November soybeans were down 9 3/4 cents. July KC wheat closed down 15 1/4 cents, July Chicago wheat was down 17 cents, July MIAX Minneapolis wheat was down 1 3/4 cents.
The U.S. Dollar Index is down 0.54 at 97.88. The Dow Jones Industrial Average is up 507.0 points at 43,408.0. August gold is down $64.30 at $3,330.70, July silver is down $0.41 at $35.78 and July copper is up $0.0330. August crude oil is down $4.01 at $64.50, August ultra-low sulfur diesel is down $0.0859, August RBOB gasoline is down $0.1252 and July natural gas is down $0.153.
CORN:
July corn moved lower yet again Tuesday, closing at $4.16 1/4, down 3 cents. December futures were also lower, down 4 3/4 cents at $4.29. July futures posted a third straight session lower and the fourth down day out of the past five. A bearish cloud remains over the corn market. Not even the lower conditions report from USDA on Monday or a sizeable flash sale of corn to Mexico Tuesday morning could deter sellers. The market is preparing for increased corn acreage in next Monday's USDA report and traders seem to be expressing skepticism in the 1.365-billion-bushel (bb) carryout stocks number USDA is currently estimating as well.
Monday's Crop Progress report was a bit of surprise with national good-to-excellent ratings for the corn crop coming in 2 percentage points less than a week ago. Even with the drop, the good-to-excellent rating of 70% certainly doesn't paint a very concerning picture for the yield potential of the crop. It is worth reminding that June condition scores have a weak relationship in general with final corn yields; there is a lot of weather left to go at this point. Which is why the extension of friendly weather through June and into early July is the primary bearish factor keeping corn prices in a downtrend. The longer the forecast remains friendly, the less perceived risk to the growing crop in the eyes of traders.
In other news for Tuesday, private exporters announced a very strong round of corn sales to Mexico amounting to 24.8 million bushels (mb). Of the total, 21.8 mb are for 2025-26 and the balance for 2026-27. This will certainly extend the commitments lead over a year ago. Seasonally speaking, mid-June is typically where we start to see a pick-up in new-crop corn sales, which may be the boost of demand needed to slow the selling pressure in corn futures. For Tuesday, however, futures traders gave little mind to the flash sale.
In corn technicals, December corn futures are in clear striking distance of the current contract low of $4.28, which is a likely target for the trade this week. If that level is broken, the next round of support is likely in the low $4.20s. For a bullish objective, I'd like to see a recovery to back above former support at $4.35, which would put a challenge of downtrend resistance in the $4.40 to $4.45 area back into play.
The DTN National Corn Index finished Monday at $3.98. Tuesday's futures close and implied corn basis of 21 cents under the July board would indicate the index on Tuesday afternoon to be near $3.95.
SOYBEANS:
July soybeans dropped another 12 cents Tuesday to $10.46 3/4. November soybeans were down 9 3/4 cents to $10.37. It was another day of profit-taking across the soybean complex, primarily spurred on by the drastic reversal in crude oil prices which spilled over into soybean oil futures as well. Soybean oil futures closed at 52.17, trading lower for the fifth straight session and chipping away slightly at the gap left in the chart following the June 13 EPA announcement. If profit-takers decide to fill the gap, 50.61 is the target.
Monday's Crop Progress report saw soybean conditions hold steady at 66% good to excellent, just a point lower than at this point in 2024. Soybean plantings were reported at 96% complete as of June 22, just a point behind 2024 as well. Currently there are no glaring delays with the majority of soybean planting regions now within the late planting window for crop insurance purposes. It is worth noting that lagging states such as Kansas and Kentucky have portions of the state that allow soybean planting up until June 30 so there is still incentive there for producers to plant to the buzzer.
In soybean technicals, November futures traded back below the 20-day moving average near $10.40 Tuesday, while the 50-day moving average near $10.36 3/4 held for now. The 50-day moving average has been relatively supportive to new-crop soybean futures since mid-April.
The DTN National Soybean Index finished Monday at $9.99. Tuesday's futures close and implied soybean basis of 60 cents under the July board would indicate the index on Tuesday afternoon to be near $9.87.
WHEAT:
Wheat futures traded sharply lower again Tuesday with July Kansas City futures down 15 1/4 cents to $5.34 3/4. July Chicago and MIAX Minneapolis wheat futures were also lower, with Minneapolis showing the most resilience to the pressure, closing down only 1 3/4 cents.
Winter wheat harvest across the U.S. advanced 9 points through the most recent week to 19% complete on average. This remains behind the previous 5-year average pace of 28% heading into the final week of June. Meanwhile, conditions also declined nationally, with good-to-excellent ratings declining by 3 percentage points to 49%. Leading weekly declines came from Montana, Oklahoma, and Colorado. Oklahoma and Colorado's drops may be a bit misleading, especially for Colorado where conditions were 66% good to excellent prior to this week and even with the drop still sit in better shape than at this point in 2024. Top-producing Kansas lost 4 points from good-to-excellent ratings, perhaps reflective of heavy precipitation and wind damage early last week. It is also possible high heat through the weekend played a role. The heat looks to break over the next week's forecast, and there are chances for rains across the Southern Plains, which at this point may work to slow harvest further in some areas.
For Tuesday, wheat traders pretty much ignored Monday's Crop Progress report, perhaps seeing enough opportunity for dry windows in the forecast for harvest pace to catch up, and not seeing the drop in winter wheat ratings as a serious issue at this point. On the world scale, generally good conditions for the crop in France as well as improved estimates in recent weeks and months for the Russian wheat crop continue to add to pressure on wheat futures.
The DTN National HRW Index finished Monday at $4.93, while the DTN National HRS Index was $5.98. Tuesday's futures close and the implied basis of 57 cents under the July for HRW, and 16 cents under the July for HRS, would indicate the indices for Tuesday afternoon to be near $4.78 and $5.96, respectively.