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Corn and soybeans settle slightly higher

Wheat futures end lower at the close.

At the close of CME Group trading Friday, corn and soybean futures settled slightly higher while wheat slipped.

July corn futures finished 1¾¢ higher at $3.19¼; December corn futures ended ¼¢ higher at $3.32.
 
July soybean futures finished 1½¢ higher at $8.38½¢; November soybean futures are 1¾¢ higher at $8.45½.

July wheat futures settled 2¢ lower at $5.00¼. 

July soy meal futures ended 70¢ per short ton lower at $287.50. July soy oil futures are 0.40¢ higher at 26.58¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.95 per barrel higher at $29.51 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 86 points higher.

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DES MOINES, Iowa -- At midsession Friday, corn and soybean futures remain higher with wheat down slightly.

During late-morning trading, July corn futures are 1¾¢ higher at $3.19¼; December corn futures are ½¢ higher at $3.32¼.
 
July soybean futures are 1¢ higher at $8.38; November soybean futures are 1½¢ higher at $8.45¼.

July wheat futures are 1¼¢ lower at $5.01.    

July soy meal futures are $0.10 per short ton lower at $288.10. July soy oil futures are 0.21¢ higher at 26.39¢ per pound.

Analysts see today’s low volume trading as modestly positive so far. Here’s what some of them say is driving the markets:

“I think it’s general optimism on the consistency of Chinese buying U.S. grains over the past week and the fact that the WASDE pretty much built in the most bearish corn scenario possible. Without more bearish news, prices could stabilize – you have to feed the bear,” says Sal Gilbertie, founder of Teucrium Trading.

At the PRICE Futures Group, senior analyst Jack Scoville says, “It’s a low-volume trade for me today with no one real interested in doing anything out in the country or, for that matter, around the world.  Prices are drifting higher as the background demand improves even though there are no headlines today. China is, in fact, buying soy products, and ethanol and feed demand is improving slowly for corn. Seasonally we rally a bit at this time of the year, although it might not be much this year.”

Britt O’Connell, cash adviser for Commodity Risk Management Group, also says today is a quiet one at the CME.

“Corn and soybeans are both trading in positive territory, attempting to regain some of yesterday’s losses,” she says. “With Tuesday’s WASDE report largely being considered a nonevent, the market seems content to remain rangebound. Spring weather continuing to prove amicable and no major news pushing us in either direction. China continues to buy U.S. soybeans and has had a consistent bid presence. Certainly we appreciate the purchases and welcome a further presence. Should they intend to make good on the Stage 1 agreement, markets would be positioned to respond favorably.” 

In the outside markets, the NYMEX crude oil market is $1.34 per barrel higher at $28.90 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 163 points lower.

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DES MOINES, Iowa -- On Friday, the CME Group’s grain futures are modestly higher.

In early trading, the July corn futures are 2¢ higher at $3.19½. Dec. corn futures are 1¢ higher at $3.32¾.
 
July soybean futures are 3¾¢ higher at $8.40¼. November soybean futures are 4¾¢ higher at $8.48½.

July wheat futures are 3½¢ higher at $5.05¾. 

July soymeal futures are $1.10 per short ton higher at $289.30. July soy oil futures are 0.26¢ higher at 26.44¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.12 per barrel higher at $28.68 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 180 points lower.

Al Kluis of Kluis Commodity Advisors sees few bullish factors for the corn market.

“The most likely path for corn over the next few weeks is sideways to lower,” Kluis says. “One of the few catalysts that could give the bulls an edge would be continued sales to China. Multiple days per week with daily sales announcements might convince momentum traders to try the long side of corn.”

“Grain traders are looking at a planting pace above the five-year average for both corn and soybeans. The corn market is facing the potential for the largest carryover in more than 30 years,” Kluis says in his opening comments for today’s trading. “China did buy U.S. corn this past week, which is great news. However, traders have been waiting a long time for this 'phase one' story to unfold. Now we need those sales to keep the carryout situation from getting worse.” 

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INDIANOLA, Iowa -- On Thursday, the CME Group’s farm markets close lower.

At the close, the July corn futures finished ¾¢ lower at $3.17¼. Dec. corn futures ended ¾¢ lower at $3.31.
 
July soybean futures ended 2½¢ lower at $8.37. November soybean futures closed 1¾¢ lower at $8.43½.

July wheat futures ended ½¢ higher at $5.02¾. 

July soymeal futures settled $2.40 per short ton lower at $288.30. July soy oil futures closed 0.27¢ higher at 26.18¢ per pound.

In the outside markets, the NYMEX crude oil market is $2.10 per barrel higher at $27.39 per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 230 points higher.

On Thursday, private exporters reported to the U.S. Department of Agriculture the following activity:

  • Export sales of 198,000 metric tons of soybeans for delivery to China. Of the total, 132,000 metric tons is for delivery during the 2019/2020 marketing year, and 66,000 metric tons is for delivery during the 2020/2021 marketing year.
  • Export sales of 20,000 metric tons of soybean oil for delivery to China during the 2019/2020 marketing year. 

The marketing year for soybeans began Sept. 1; soybean oil began Oct. 1.

Al Kluis, Kluis Advisors, says that the markets are trading planting decisions and planting weather.    

“The May grain contracts expire today. Take note of where those contracts close, since that will be the target for the bears to fill the continuation gap,” Kluis told customers in a daily note. 

Kluis added, “The current corn-to-soybean ratio is near 2.55. That suggests soybeans are trying to buy acres. However, at the speed corn is being planted this spring, it does not appear that the ratio is high enough yet.”

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Wednesday’s Grain Market Review

On Wednesday, the CME Group’s farm markets closed sharply lower, following yesterday’s bearish USDA Report.

At the close, the July corn futures finished 4¢ lower at $3.18¼. Dec. corn futures finished 3¼¢ lower at $3.32½.
 
July soybean futures closed 12¾¢ lower at $8.39¼. November soybean futures ended 11½¢ lower at $8.45½.

July wheat futures settled 12¾¢ lower at $5.01¾. 

July soymeal futures closed $1.50 per short ton higher at $290.60. July soy oil futures closed 0.35¢ lower at 25.91¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.52 per barrel lower at $25.26 per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 572 points lower.

Jack Scoville, PRICE Futures Group, says that the soybean market took a haircut based on a rift between the U.S. and China. 

“The falling wheat market is mostly about EU and Russian weather, with both areas greatly improved with recent rains. The wheat weather situation in the U.S., dry and hot in the southern Great Plains, is being ignored. And there are some forecasts for showers in the region through the weekend. Soybeans are down, I think, on an article by Bloomberg stating that China will buy according to the trade environment and if the U.S. is nice to it. The U.S. is currently doing the opposite with the coronavirus threats against China. Corn fell in sympathy. It is a seasonal time to rally, so this might be a buying chance. But the demand side remains pretty tough for ag markets,” Scoville says.

On Wednesday, private exporters reported to the USDA export sales of 396,000 metric tons of soybeans for delivery to China. Of the total, 198,000 metric tons is for delivery during the 2019/2020 marketing year, and 198,000 metric tons is for delivery during the 2020/2021 marketing year.

The marketing year for soybeans began September 1.

Al Kluis, Kluis Advisors, says investors will be watching crop progress and exports going forward.    

“Corn traders desperately want to see ethanol turn around. The fastest way for new-crop corn carryout to drop is cranking up ethanol production. Chinese exports would help greatly, but that is a wild card at this time,” Kluis told customers in a daily note. “Can July corn move over $3.24? That is the high from Tuesday. Rising over it would indicate that bulls are gaining momentum after a bearish report.”

Kluis added, “The USDA report on Tuesday put new-crop carryover right in the range that traders were expecting. Granted, this is the first report with these numbers, so it is expected that we will see adjustments as we progress this season. At this point, corn and wheat are worrying traders as supplies look very ample. Exports will need to pick up greatly to offset loss of demand in other areas.”

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets close mostly lower, in resoponse to a bearish USDA WASDE Report.

At the close, July corn futures finished 3¾¢ higher at $3.22¾; December corn futures settled 1¢ higher at $3.35¼.
 
July soybean futures closed 3¢ lower at $8.52; November soybean futures closed 1½¢ lower at $8.57.

July wheat futures settled 2¾¢ lower at $5.14½. 

July soy meal futures ended $1.80 per short ton higher at $292.10. July soy oil futures closed 0.23¢ lower at 26.26¢ per pound.

In the outside markets, the NYMEX crude oil market is $1.65 per barrel higher at $25.79 per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 338 points lower.

On Tuesday, private exporters reported to the USDA export sales of 136,000 metric tons of soybeans for delivery to China during the 2019/2020 marketing year.

The marketing year for soybeans began September 1.

On Tuesday, the USDA will release its May WASDE and Supply/Demand Reports. Prereport estimates expect the USDA to peg the U.S. corn old-crop ending stocks at 2.22 billion bushels vs. the government’s April estimate of 2.092 billion. New-crop corn ending stocks are estimated at 3.38 billion bushels.

For U.S. soybeans, the 2019/2020 ending stocks are expected at 488 million bushels vs. the USDA’s April estimate of 480 million. New-crop soybean ending stocks are expected to come in at 430 million bushels.

For wheat, the U.S. old-crop ending stocks are expected to be around 969 million bushels, below the USDA’s April estimate of 970 million. New-crop wheat estimates are seen at 814 million.

The USDA Crop Progress Report on Monday showed corn planting at 67% complete. That is 16% ahead of the five-year average. Soybean planting is at 38% complete, 15% ahead of the five-year average. Spring wheat planting is still behind at 42% complete.  

Al Kluis, Kluis Advisors, says investors will be watching crop progress, going forward.    

“The grain trade will begin to focus more on corn and soybean emergence and crop conditions next week. Early planting does not always create trend line yields if emergence falls behind and cold weather takes conditions lower,” Kluis told customers in a daily note. 

Kluis added, “What will the USDA report today for corn used in ethanol production? What about ending stocks of corn for this year and next year? I expect the USDA to take corn usage much lower, which would create larger ending stocks of corn than the trade is expecting.”

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Monday’s Grain Market Review

On Monday, the CME Group’s farm markets close mostly lower.

At the close, July corn futures finished ¾¢ lower at $3.18; December corn futures ended 1¢ lower at $3.34¼.
 
July soybean futures closed 4¼¢ higher at $8.55; November soybean futures settled 3¢ higher at $8.58½.

July wheat futures closed 4¼¢ lower at $5.17¼. 

July soy meal futures finished $0.50 per short ton lower at $290.30. July soy oil futures closed 0.05¢ lower at 26.49¢ per pound.

In the outside markets, the NYMEX crude oil market is 19¢ per barrel lower at $24.55 per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 2 points lower.

On Tuesday, the USDA will release its May WASDE and Supply/Demand Reports.

Prereport estimates expect the USDA to peg the U.S. corn old-crop ending stocks at 2.22 billion bushels vs. the government’s April estimate of 2.092 billion. New-crop corn ending stocks are estimated at 3.38 billion bushels.

For U.S. soybeans, the 2019/2020 ending stocks are expected at 488 million bushels vs. the USDA’s April estimate of 480 million. New-crop soybean ending stocks are expected to come in at 430 million bushels.

For wheat, the U.S. old-crop ending stocks are expected to be around 969 million bushels, below the USDA’s April estimate of 970 million. New-crop wheat estimates are seen at 814 million.

Al Kluis, Kluis Advisors, says investors will be watching crop weather, the stock market, and this week’s USDA Supply/Demand Report for guidance on grain market direction.    

“The U.S. stock market and crude oil prices rallied sharply higher last week and that helped the grain markets rally,” Kluis told customers in a daily note. 

Kluis added, “It’s cold outside. The USDA will show corn planting advancing to a near-record 70% in the Crop Progress Report today. However, emergence will fall behind the five-year average because of the unseasonably cold temperatures. Current temperatures across the Corn Belt show the freezing 28˚F. to 30˚F. only in extreme northern Minnesota, Wisconsin, and Michigan. Tonight is likely to be the coldest night, but I expect the freeze damage to be limited to just 1% or 2% of the Corn Belt.”

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