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Crude oil at lowest price since January | Wednesday, September 7, 2022

Crude oil, corn, and soybeans close low: 1:31 p.m.

What a roller coaster today in the grain markets. The news that Putin may not continue to allow grain exports out of the Ukraine rallied wheat sharply higher and this then pulled the corn and soybean markets higher.

Then later in the day as the crude oil market went sharply lower, the corn and soybean markets also turned lower. Corn and soybeans closed lower and right at the lows of the day.

This week is when the USDA employees and other enumerators are out weighing the ears of corn, counting kernels, and measuring how many soybean pods are in each square yard. I think they will see that the late heat and dry weather is taking a toll on corn and soybean yields.

Looking ahead, I will be watching the global and U.S. stock markets to see if today’s gain can continue into the end of the week. I will also be watching crude oil prices. Crude oil prices were hit hard, trading down over $4.00 per barrel at the lowest price now since January of 2022. If the stock market rebound continues and energy prices stabilize, it's good news for the grain markets.  

December corn trading range today was 19¢ prices closed down 5¢ at $6.71. November soybeans trading range was 52¢, futures closed down 15¢ at $13.84. Wheat futures closed 16 to 23¢ higher. This was about 15 to 20¢ off the early day high.

Livestock futures turned lower late in the day. November Feeder cattle closed $1.57 lower, October Live cattle on a late sell-off closed down 80¢, and October hogs closed down 2¢. 

Wheat backs off early highs, but still up: 10:42 a.m.

The news overnight that Putin was threatening to shut down the grain export corridor from the Ukraine has created a huge rally in the wheat market. Wheat futures are 20¢ off the early day highs, but are trading up 23¢ to 45¢ per bushel.

December corn’s trading range is 15¢. Last trade is down 1¢ at $6.75. 

November soybeans are still higher on the day. The trading range is 48¢. Last trade is up 4¢ at $14.02, but that is 29 cents off the early day high. 

The key, as I mentioned this morning, is to see if December Corn can close above $6.80 and November soybeans above $14.20. It’s a long time till 1:15 p.m. close. 

The USDA Crop conditions report showed conditions unchanged from last week, most important was the down trend in conditions during the month of August. This increases the chance of the USDA plugging in lower yields in the supply/demand report next Monday  

Livestock futures are mixed this morning. Feeder cattle are 55¢ lower. October live cattle have turned higher and are now up 25¢. October hogs are up 80¢.

Wheat sharply higher following news out of Russia: 9:22 a.m.

In the overnight news, Russian President Vladimir Putin said "he’s unhappy with the grain corridor agreement because the wheat is moving to Europe and not to the poor African countries and other poor countries of Asia that are suffering severe food insecurity issues.” 

He is weaponizing food and this threatens to stop grain shipments out of Ukraine.

Wheat turned sharply higher on this news and now corn and soybeans are higher as well. December corn is up 10¢. November soybeans are up 16¢. Wheat futures are 38¢ to 40¢ higher.

On my charts I am watching to see if December Corn can close above $6.80 today and November soybeans above $14.20.

Livestock futures are mixed this morning. Feeder cattle are down $1.27 with the higher corn market. October live cattle are also under selling pressure as futures are down 12¢ to 50¢. October lean hog futures are up another $1.60. 

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: Al Kluis has been a commodity advisor and broker since 1976. Kluis is an introducing broker with Wedbush Futures and writes a column, Your Profit, which appears in every issue of Successful Farming magazine. Kluis has published two books on commodities trading and is commonly quoted in major publications including the Wall Street Journal. He is also a featured speaker at commodity conferences nationwide. Kluis is a frequent market analyst for the Linder Farm Radio News Network. A Minnesota farm boy, Kluis was awarded his degree in ag economics from the University of Minnesota in 1974, after which he was executive director of the Minnesota Soybean Association before entering the markets full-time. His family still farms in southwest Minnesota, and Kluis enjoys helping with fieldwork when the markets allow.

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.

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