THE OPEN

November beans: 5 lower

Dec meal:  1.30 lower

Dec soyoil:  11 lower

Sep. corn:  1/2 higher

Sep wheat:  14 lower

The markets opened as called with more weakness noted across the board.  Wheat prices quickly headed downward to set new lows.  Buy corn/sell bean and wheat trade were noted throughout the session.  China remains on holiday until next Monday, but they are probably looking at bean prices as values head lower.  Good weather and negative outside markets exerted further downside pressure.  Movement remained very quiet with farmers holding tight as funds extended sales.  

SOY

• The soy complex opened into weaker trade as funds may be short beans, meal, and soyoil futures now.  Sep. crush continues on the defensive, trading down to 78.18c/bu while oilshare holds a steady to slightly weaker tone at 32.51%.  
• November bean prices opened lower but spent much of the morning session sitting on key support levels at $8.60.   
• Dec soyoil futures were lower on the back of weaker palm and energy prices, selling off under prev. lows towards the 28c benchmark.  
• Dec meal broke lower towards $290.00 key support as Dec soyoil traded lower towards 28c.   
• Nearby bean spreads remained firm with July/Nov still trading at a 2 1/4c inverse while July/August traded at a 3 1/4c inverse from 2 1/2c.  Meal spreads were slightly narrower with July/Dec trading into $7.20 from $9.40.  
• The International Grains Council, (IMF), forecast global bean production at 364 mmt for 20/21, which would be up 8%, but would also be accompanied by record-large exports, so that bean stockpiles would rise by only 1 mmt.  The IGC forecast Brazil production at 129.4 mmt, slightly smaller than the latest USDA estimate of 131 mmt.

GRAINS

• Buy corn/sell wheat trade was the major feature of the day.  
• The early morning trade consisted of slight short-covering in corn, where new positions were opened yesterday as reflected by rising open interest and new low prices.  Dec corn firmed from new contract lows at $3.24 while Sep. corn traveled up to key resistance closer to $3.25 as prices attempted to stabilize from contract lows.  
• Corn spreads were generally firmer with Jly/Dec trading into 10c from 11 3/4c while July/Sep. traded into 2 3/4c from 4c.   
• Sep. wheat prices traded down to recent lows at $4.81 but slipped into sell-stops under this level which triggered further fund selling activity.  Prices traded to new lows with little back support to stem a slide.  
• Reports are that winter wheat harvest in Kansas could be around 45% complete, with Texas and Oklahoma around 98%.   Ideas that corn ratings will improve on Monday continue to set the tone for defensive corn trade, while the near-record shorts in corn and scale-down consumers provide support.  
• Technically speaking both corn and wheat are in defensive enough trade that lower prices will have to verify today that they can hold onto their current lows.

AT MIDDAY THE MARKETS ARE AS FOLLOWS:

                                                                    HI                             LO

November beans:  3 lower                     8.70 1/4                      8.63

Dec meal:  1.40 lower                            293.80                        290.80

Dec soyoil:  14 lower                             2868                            2822

Sep. corn:  2 higher                               3.23                             3.19

Sep.  wheat:  4 lower                            4.89                              4.72 3/4

Nov canola:  .80 higher                        470.80                           469.30

OUTSIDE MARKETS

The Dow was down 200 pts in early trade but traded down over 500 pts as virus cases continue to rise.  Crude oil trades down to $37.83/barrel while the US dollar trades up to 97.25.  

CLOSING COMMENTS

Benign weather forecasts are keeping prices on the defensive.  Corn open interest was higher yesterday which indicates that many opened new short positions. Advertised expectations are that ratings could improve for beans and corn by 1%. Tough to keep markets up when weather is good.  Corn prices will be 15c lower for the week

 The commitment-of-trader's report will be released today and could show that funds are now short both the grains and soy complex, which is a rare event.  The market will be closed on July 3, and in front of that is the June 30 Stocks/Acreage report.   First notice day is Tuesday, and for the moment there are no bean or corn deliveries, 11 SRW, 17 HRW, 511 meal, and 3,495 soyoil.  

Look for opening trends to sustain into the close, with possible losses continuing into the close, but less so for corn where some recent, (or old), shorts may elect to take something off.  

 

TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America