Content ID

328653

Grain prices end the day lower with a commodity wide selloff  | Tuesday, May 31, 2022

July corn was down 23 ¾ cents with December corn down 18 ½ cents. July soybean futures were 49 cents lower with November beans down 34 ½ cents. July Chicago wheat closed down 70 cents, July Kansas City wheat closed down 69 ¾ cents and July Minneapolis wheat closed down 57 ¼ cents.

Livestock prices closed the day lower. Live cattle futures finished the day down $1.65 on the June contract. August feeder cattle closed down $1.20, and June lean hog futures closed the day $2.42 lower.

Crude oil is down 7 cents and the Dow futures were 222 points lower.

Month-end selling by the funds took center stage. With the bulk of the crop planted in the U.S. and the weather looking non-threatening, it makes sense for the funds to take some risk off and go to the sideline.

Russia is still pounding the headlines suggesting they are willing to allow grain to be exported out of Ukraine through the Black Sea. It is highly unlikely this will happen, but the market was sensitive to that headline with wheat down close to limit today.

Early in the day, news that the EU was going to put more sanctions on Russian oil helped crude oil trade close to $120 per barrel. However, late in the day, OPEC is rumored to be considering suspending Russia's oil production. If it follows through, we could see the countries involved with OPEC increase their crude oil output and caused the crude oil futures to selloff.

The Crop Progress report today did show 86% of corn planted and that compares to 94% planted a year ago and 87% planted on a five-year average. For soybeans, we are 66% planted vs 85% planted a year ago and 67% planted on a five-year average.

With a bulk of the U.S. crop planted and rated pretty high, we are in a time of the year where futures will have a tough time holding up at these current levels.   

MIDDAY COMMENTS: 11:45 A.M.

At midday, July corn futures are down 22 to 23 cents with December corn futures down 18 to 19 cents. July soybean futures are 40 to 41 cents lower with November futures down 25 to 26 cents. July Chicago wheat is 63 cents lower. July Kansas City wheat is 58 cents lower, and July Minneapolis is 47 cents lower.

Livestock prices are mixed with live cattle down 20 cents. Feeder cattle are $1.20 higher, and lean hogs down $2.80 per hundred.

Crude oil is up $2.17, and the Dow futures are 287 points lower.

Traders seem to be going to the sidelines today as we wrap up the month of May. Spreads in corn and soybeans are very soft. Once the selling started, the stops were hit.

Wheat is the leader to the downside. More talks of Russia allowing Ukraine grains to get exported out of the Black Sea region has wheat under a lot of pressure. That, in turn, is spilling over into the corn market.

Weekly export inspections were released at 10 a.m. CT. Corn and soybean export inspections were down from last week’s numbers but still at some respectable levels. Wheat export inspections saw a slight uptick from the previous week.

The Crop Progress report will be out at 3 p.m. CT today. We will get our first condition scores for both corn and soybeans. Look for the crop to be rated pretty good considering the late spring we saw in the U.S.

OPENING COMMENTS: 8:45 A.M.

July corn futures are 3 to 4 cents lower. July soybean futures are 10 to 11 cents higher. July Chicago wheat is 26 cents lower. July Kansas City wheat futures are 26 cents lower, and July Minneapolis wheat futures are 15 cents lower.   

Livestock prices are mixed this morning. Live cattle are 75 cents higher. Feeder cattle are 62 cents higher. Lean hog futures are $1.82 lower. 

Cash hog prices and carcass values last week were a little lower on Friday, and we are seeing some selling this morning. We still need to see the product get cleaned up in the lean hog complex. Also, China is slowly opening back up, and as it does, we should see meat exports from the U.S. pick up. 

Crude oil is up $4.09 this morning and the stock market is down 335 points to start off today's trade.

Big rains for the Upper Plains including the Dakotas, portions of Nebraska, and parts of Minnesota. These heavy rains over the three-day weekend are in areas that are already very wet. The question traders will focus on this week is how many Prevent Plant acres will we have in the Dakotas and northern Minnesota?

Wheat futures are under pressure as a good portion of the winter wheat area should get some rains this week and help add a few more bushels to their crop this year.  There is still some optimism that Ukraine exports will resume.

Corn is stuck between wheat futures coming under pressure and a very strong crude oil market. Look for a choppy day of trade.

The latest Crop Progress report, which will be released at 3 p.m. CT, should show corn planting in the 85% to 90% area. Soybeans should be 70% to 75% planted.

For a free trial of The Kluis Report including three times a day market updates and the Saturday newsletter, visit kluiscommodities.com, call 888-345-2855, or email info@kluiscommodityadvisors.com

About the Author: Cory Bratland is the youngest of five children who grew up on his family’s farm near Willow Lake, South Dakota. Bratland attended Willow Lake High School and graduated with an A.A.S. degree in ag business management at Lake Area Technical Institute in Watertown, South Dakota. He began his career as a cash grain marketer and grain trader with Cargill, Inc. While working for Cargill, Inc. Bratland held various merchandising jobs across South Dakota and Minnesota. In 2003, he was licensed as a Series 3 and 30 commodity broker. In 2008, Bratland left Cargill to be an independent commodity broker, starting Prairie Ag Marketing Services. In 2009, he partnered with Al Kluis as an affiliate office. In 2010, he became Kluis Commodity Advisors' Chief Grain Strategist. In addition to working with Al daily on marketing strategies, Bratland also serves private clients through Kluis Publishing and Prairie Ag Marketing. He lives near Willow Lake, South Dakota with his wife Erica and children, Hunter, Elliot and Isabella. He still actively participates in the family farm that raises corn, soybeans, alfalfa and also runs a cow/calf operation.

Editor’s Note: The risk of loss in trading futures and/or options is substantial, and each investor and/or trader must consider whether this is a suitable investment. Past performance – whether actual or indicated by simulated historical tests of strategies – is not indicative of future results. Trading advice reflects good-faith judgment at a specific time and is subject to change without notice. There is no guarantee the advice given will result in profitable trades.

Read more about
Loading...

Talk in Marketing