Soybeans–
Soybeans closed 10 cents lower to start the week. The weather has had an effect on the market, with hot and wet weather across the Plains and Midwest. The wet weather combined with unusually hot temperatures has provided a greenhouse like environment which is beneficial for soybean crops. At this time, there is no weather story in the market that could help with higher prices.
The period from late June through early October has been a dangerous stretch over the last 15 years. Over this timeframe soybeans saw losses in 11 out of 14 years, with an average return of -4.87%. It’s one of the weakest seasonal windows in the entire commodity complexes.
Export sales for the week ending June 12, were 539k mt for old crop and 75 mt for new crop, both in line with trade estimates.
Looking at technicals, support is at 10.50, resistance is at 10.60 in November soybeans.
July Soybeans (ZSN25) settled at 1058 (-10), high of 1067, low of 1044. New crop November Soybeans (ZSX25) settled at 1046.50 (-14). Cash price is at 1045 (-6)
July Bean Meal (ZMN25) settled at 282.3 (-1.7) high of 285.9, low of 281.4
July Bean Oil (ZLN25) settled at 53.11 (-1.23) high of 55.14, low of 53.06
The July Meal to Oil ratio (50.74% Meal – 49.26% Oil)
ZSN25 Moving Averages – (1069) 5-day, (1055) 20-day, (1054) 50-day, (1049) 100-day, (1048) 200-day
ZSX25 Moving Averages – (1060) 5-day, (1040) 20-day, (1036) 50-day, (1033) 100-day, (1034) 200-day
ZMN25 Moving Averages – (284) 5-day, (292.5) 20-day, (295.4) 50-day, (301.9) 100-day, (310.1) 200-day
ZLN25 Moving Averages – (54.48) 5-day, (49.55) 20-day, (49.21) 50-day, (47.20) 100-day, (45.34) 200-day
The Commitments of Traders report for the week ending June 10th showed soybeans Managed Money traders bought 17,038 contracts to their bringing their net long total to 25,639 contracts. Producer/Merchants sold -17,367 contracts bringing their net short position to -160,854 contracts. Non-Commercial & Non-Reportable traders net position was 43,994 contracts.
The Commitments of Traders report for the week ending June 10th showed meal Managed Money traders bought 9,909 contracts, moving to a net short position of -86,808 contracts. Producer/Merchants sold -9,212 contracts bringing their net short position to -62,105. Meal Non-Commercial & Non-Reportable traders hold a short position of -50,495 contracts.
For bean oil, the Commitments of Traders report for the week ending June 10th showed Managed Money traders were net long 24,768 contracts after selling -7,222 contracts. Non-Commercial & Non-Reportable traders net long position was 40,033 contracts.
CORN –
July Corn (ZCN25) settled at 418 (-9), high of 430, low of 417. New crop December Corn (ZCZ25) settled at 434 (-7). Cash price is 451 (-4)
Corn traded lower to start the week. The hot and wet weather in the Plains and Midwest has provided a greenhouse-like effect which is beneficial for corn. The heat is not expected to last, with rains expected this week. Over the weekend it was unusually windy in the Midwest and the Plains. There were reports of a derecho that moved through North Dakota causing some damage to grain storage facilities. In the latter part of last week, there were also reports of a derecho in Illinois but damage was less severe. Corn is potentially approaching a bottom otherwise new low are ahead.
ZCN25 Moving Averages – (429) 5-day, (439) 20-day, (457) 50-day, (470) 100-day, (462) 200-day
ZCZ25 Moving Averages – (438) 5-day, (441) 20-day, (446) 50-day, (452) 100-day, (448) 200-day
The Commitments of Traders report for the week ending June 10th showed that corn Managed Money sold -9,977 contracts bringing their net position to -164,020 contracts. Producer/Merchants bought 24,108 contracts bringing their net position to -78,344. Non-Commercial & Non-Reportable traders net short position was -171,062 contracts.
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WHEAT –
July Chicago Wheat (ZWN25) settled at 553 (-15), with a high of 570, low of 549. September Wheat (ZWU25) settled at 569 (-14). Chicago Wheat has a cash price of 570 (-6). July KC Wheat (KEN25) settled at 551 (-13). July Spring Wheat (MWN25) settled at 626 (-12)
Wheat closed lower to start the week. Wheat was supported by crude oil last week but has since follow off along with crude. Conditions are expected to be good for harvest, with hot and drier weather in the forecast for winter wheat areas of the Plains. The spring wheat belt is forecasted to see solid rains ahead.
On Friday, exports showed 427k mt of new crop wheat for the week ending June 12. The average trade estimate was 300k-600k mt. HRW exports were 127k mt, down 20% from last week.
Russia’s wheat crop is forecasted at 84.4 mmt according to Argus. This is an increase of 4.5 mmt from the last estimate. This comes after Russia issued a crop emergency due to dryness in the Rostov region just 2 weeks ago.
ZWN25 Moving Averages – (556) 5-day, (542) 20-day, (540) 50-day, (560) 100-day, (575) 200-day
ZWU25 Moving Averages – (572) 5-day, (557) 20-day, (555) 50-day, (575) 100-day, (589) 200-day
KEN25 Moving Averages – (553) 5-day, (539) 20-day, (540) 50-day, (570) 100-day, (580) 200-day
MWN25 Moving Averages – (633) 5-day, (622) 20-day, (610) 50-day, (617) 100-day, (626) 200-day
The Commitments of Traders report for the week ending June 10th showed that Managed Money traders in the wheat market were net short -94,011 contracts, having decreased their short position by 6,561 contracts. Producer/Merchants sold -2,184 contracts to bring their net position to 34,095 contracts. Non-Commercial & Non-Reportable traders were net short -95,234 contracts.
Hans Schmit
Account Executive Walsh Trading
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Toll Free 800-993-5449
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hschmit@walshtrading.com
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