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3 Big Things Today, June 19

Soybeans Rise, Corn Falls Overnight; Money Managers Bullish on Grains Last Week

1. Soybeans Higher Overnight as Weather Remains Dry in Midwest

Soybeans were higher in overnight trading on speculation that dry weather this week will curb prospects for the U.S. crop.

Only scattered and isolated rainstorms are expected early this week for much of the Midwest, some parts of which are already dry. Subsoil and topsoil moisture are still good, but with reports of a shallow crop system, what moisture is in the soil could be used up quickly, analysts say.

Still, the weather forecasts are calling for at least some rain in the Midwest, which is an improvement from some forecasts at the end of last week.

Corn prices, correspondingly, fell in overnight trading on the better forecasts and as investors play the corn-bean spreads. Wheat was little changed.

Soybean futures for July delivery rose 3¾ cents to $9.42¾ a bushel on the Chicago Board of Trade. Soy meal added $1.30 to $302.20 a short ton, and soy oil gained 0.11¢ to 33.22¢ a pound.

Corn futures fell 4¾¢ to $3.79¼ a bushel in Chicago.

Wheat for July delivery was unchanged at $4.65¼ a bushel overnight in Chicago. Kansas City futures added ¾¢ to $4.74¼ a bushel.


2. Money Managers Increase Net-Longs in Hard-Red Winter Wheat, Curb Bets Against Corn

Money managers increased their net-long positions, or bets on higher prices, for hard-red winter wheat while cutting their net-short positions in corn.

Speculative investors raised their net-longs in hard-red winter to 21,442 contracts in the week that ended June 13, according to the Commodity Futures Trading Commission. That’s up from the prior week’s net-long position of 871 contracts.

The total is also the biggest such position since March 14, CFTC data show.

Investors reduced their net-short positions, or bets on lower prices, to 4,015 contracts last week from 127,078 a week earlier, according to the CFTC.

That marks the least-bearish position for corn traders since the week that ended March 7 when they were net-long by 87,020 contracts.

Money managers also reduced their bearish bets in soybeans to 90,790 contracts from 101,752 contracts, the smallest net-short position since May 23.

They also reduced net-shorts in soft-red winter wheat to 85,706 contracts, well below the 112,413 the prior week and the smallest such position since March 7.

Investors have been more positive on the outlook for grain and soybean prices as dry weather moves into the Midwest. Commodity Weather Group said last week that little rain in spring wheat country likely will hurt crops there, and much of the Midwest is expected to be hot and dry heading into critical growth stages.

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3. Rainfall This Week Will Be Isolated, Though Indiana Has Good Chance of Precipitation

Any rainfall in the Midwest today and tomorrow likely will be isolated and scattered, according to the National Weather Service.

A severe storm that spawned at least two tornadoes tore up houses in eastern Nebraska over the weekend, but the storms for the rest of the week are unlikely to be as severe, the NWS said in a report early Monday.

The best chance of storms will be in central Indiana on Tuesday when a frontal system brings thunderstorms to the region. It’s possible growers there will see some rain later into the week and weekend, according to the weather service.

The extreme heat that gripped the Midwest also broke, but it’ll still be hot. Temperatures are expected to dip well into the 60s overnight but reach the low- to mid-90s on Tuesday and Wednesday before falling back later this week.

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