THE OPEN
Nov beans: 5 lower
July meal: .10 lower
July soyoil: 15 lower
Sep. corn: 4 lower
Sep. wheat: 4 lower
Prices opened as called with selling out of the gate. More corn states improved than did not, which created selling pressure throughout the day. Beans suffered from further skepticism over the comments as regards the trade deal, and new calls for Covid-19 free imports. Bull-spreading continued in the bean market, while short-covering was an early wheat feature. Rains over the next week seemed to cap off any gains that the market could make today, even as prices remain in ranges.
SOY
- The soy complex opened as called with prices turning higher for nearby contracts as more rumors of Chinese business persist, and some business was confirmed. July/August inverts further to 3c, with July/Nov firming into 1 1/2c in the early going.
- Meal spreads were firmer as small buy meal/sell soyoil trade was noted.
- Soyoil prices found a nice bid from higher canola and palm oil prices, but profit-taking in oilshare continued to weigh on price action into the noon hour. Sep. crush traded to 80.49c/bu while oilshare traded slightly lower at 33.0%. Heading into the noon-time hour, fund selling pressure and bean liquidation increased as good weather and a quiet export pace did not invite reasons to own the market.
- The bean business announcement this morning was the first since June 15, which played into ideas that business would be back-end loaded rather than immediate. Weaker crush margins in China and reports of saturated ports kept prices on the defensive.
GRAINS
- Prices were mixed today as new shorts in wheat continued to monitor the upside potential for retracement in Sep. wheat on a bounce over $4.92. The door is open to a test of $5.05 first and $5.15 second should prices continue to firm.
- Sep. corn held key support at $3.25, while good weather and unwinding of recent buy corn/sell wheat trade pressured prices. Nearby corn spreads were firmer as July contracts continue to roll forward, with July /Dec corn trading into 10 1/2c while July/Sep firmed to 3 1/2c from 4 3/4c.
- Rolling of July contracts continues to be the most active trade in terms of volume China continues to auction off large amounts of state corn reserves, but so far there are no signs of further US corn biz.
- Wheat prices continued to congest with a nice bid as traders unwind previous buy bean and corn/sell wheat trade. Sep wheat/corn trades from 1.55 3/4c to 1.61 3/4c.
AT 12:00 THE MARKETS ARE AS FOLLOWS:
hi lo
Nov beans: steady 8.80 1/4 8.65
July meal: up .20 287.60 285.30
July soyoil: 20 lower 2842 2789
Sep. corn: 4 lower 3.32 1/4 3.25 3/4
Sep. wheat: steady 4.93 1/4 4.83 3/4
Nov canola: .90 lower 478.00 475.40
OUTSIDE MARKETS
Stocks were 179 pts higher in early trade. Better than expected data helped, with new home sales jumping by 16.6% in May to an annual rate of 676,000. Crude oil prices remain well bid with a high of $41.63/barrel, and the US dollar at 96.38. Stocks retain strength at midday, up 190 pts.
CLOSING COMMENTS
July options expire Friday and traders continue to roll July contracts forward. Weather maps continue to look wet increasing the chance that corn could only get better and pollinate successfully into the 4th of July weekend. Seasonally we are reaching the point of time in June for corn, at least, that seasonally turns a bit more negative if crops do not face challenges. If short wheat, would think about taking off something at this level as we could see more buy wheat/sell corn on the back of continued rainfall.
The soy complex may continue to see buying interest on breaks as long as prices do not leave current trading ranges:
Nov beans: $8.65-$8.85, target high of $8.92 /$9.00 if China purchases or a technical break-out occurs.
Sep. corn: $3.25-$3.39, trendline support at $3.22 needs to hold in order to keep prices sideways
Sep. wheat: $4.80-$5.15, trying to stabilize and would cover a partial short as prices could edge back towards $5.00/$5.05 short term
Have a good evening........
TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America
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