Soybeans–
As of Monday, planting progress is at 90% complete, up 6% over last week. The 10-year average for this time of year is 84%. Crop conditions were rate 68% good/excellent up 1% over last week. The 10-year average for soybean conditions at this time of year is 69%. The best conditions for this time of year came in 2018 at 74% good/excellent. The worst conditions for this time of year were 55% good/excellent in 2001. The worst soybean crop conditions at this time are in in Illinois at 59% good/excellent and 7% poor/very poor. Illinois is also the largest soybean growing area, but Iowa, the second highest yielding state, is at 80% good/excellent.
Weather forecasts for the next 5-10 days show higher temperatures in the Midwest, which could be beneficial for crop development as there has been a lack of growing degree days thus far. Overall, temperatures have been slightly below-normal. The second day of talks between the U.S. and China took place today in London. U.S. Commerce Secretary Howard Lutnick said, this morning, that talks were “going well,” further updates are expected shortly. Ending stocks were tightened more than expected on the May WASDE, any further reductions on Thursday would be bullish for soybean prices.
July Soybeans (ZSN25) settled at 1057 (+1), high of 1063, low of 1055. New crop November Soybeans (ZSX25) settled at 1031 (+0.50). Cash price is at 1041 (-2)
July Bean Meal (ZMN25) settled at 295.9 (+0.50) high of 296.4, low of 294
July Bean Oil (ZLN25) settled at 47.79 (+0.41) high of 48.05, low of 47.38
The July Meal to Oil ratio (55.61% Meal – 44.39% Oil)
ZSN25 Moving Averages – (1053) 5-day, (1054) 20-day, (1047) 50-day, (1050) 100-day, (1047) 200-day
ZSX25 Moving Averages – (1031) 5-day, (1038) 20-day, (1028) 50-day, (1032) 100-day, (1033) 200-day
ZMN25 Moving Averages – (296.3) 5-day, (294.9) 20-day, (299.8) 50-day, (304.5) 100-day, (311.4) 200-day
ZLN25 Moving Averages – (47.23) 5-day, (48.61) 20-day, (48.30) 50-day, (46.68) 100-day, (44.91) 200-day
The Commitments of Traders report for the week ending June 6th showed soybeans Managed Money traders sold -28,096 contracts to their bringing their net long total to 8,601 contracts. Producer/Merchant traders bought 32,487 contracts bringing their net short position to -143,487 contracts. Non-Commercial & Non-Reportable traders net position was 20,330 contracts.
The Commitments of Traders report for the week ending June 6th showed meal Managed Money traders sold -2,932 contracts, moving to a net short position of -96,717 contracts. Producer/Merchants added 2,967 contracts bringing their net long position to 111,232. Meal Non-Commercial & Non-Reportable traders hold a short position of -58,340 contracts.
For bean oil, the Commitments of Traders report for the week ending June 6th showed Managed Money traders were net long 31,990 contracts after selling -21,998 contracts. Non-Commercial & Non-Reportable traders net long position was 41,253 contracts.
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CORN –
July Corn (ZCN25) settled at 438 (+5), high of 439, low of 429. New crop December Corn (ZCZ25) settled at 440 (+2). Cash price is 448 (-9)
Brazil corn exports are expected to decline 9% this year due to the high demand for feed use and ethanol in the country. Brazil is expected to have its second largest harvest ever, with production estimated between 4.995 billion bushels and 5.4 bb. Lower exports in Brazil will likely be beneficial for U.S. exports, especially if a deal with China is completed. U.S. corn exports have already exceeded expectations in the first half of the year.
Corn crop ratings came in Monday at 71% good/excellent, up 2% over last week. The strongest corn crop ratings are in Iowa, followed by Minnesota. The worst conditions are in Indiana and Illinois. Indiana has 7% rated poor/very poor.
The COT for the week ending June 6, showed managed money had a 9-month high in their net short position. It will be interesting to see how the funds position after this week’s WASDE report and ahead of the June Grain Stocks report on the 28th. The UN-FAO has global corn production at a record, up 3.8% over last year. Global supply is huge despite production issues in Eastern Europe and in Asia. The June WASDE report comes out on Thursday. The average guess for USDA’s old crop figure is 1.392 billion bushels (bb) and 1.792 for new crop. The low guess for new crop is 1.713 bb and the highest is 1.792 bb. On the May report, old crop came in at 1.415 bb and new crop was 1.8 bb.
ZCN25 Moving Averages – (438) 5-day, (446) 20-day, (462) 50-day, (475) 100-day, (462) 200-day
ZCZ25 Moving Averages – (443) 5-day, (443) 20-day, (448) 50-day, (454) 100-day, (448) 200-day
The Commitments of Traders report for the week ending June 6thh showed that corn Managed Money sold -4,913 contracts bringing their net position to -154,043 contracts. Producer/Merchant traders bought 47,609 contracts bringing their net position to -102,452. Non-Commercial & Non-Reportable traders net short position was -170,495 contracts.
WHEAT –
July Chicago Wheat (ZWN25) settled at 534 (-7), with a high of 542, low of 530. September Wheat (ZWU25) settled at 548 (-8). Chicago Wheat has a cash price of 548 (-12). July KC Wheat (KEN25) settled at 527 (-10). July Spring Wheat (MWN25) settled at 613 (-9)
The wheat market closed lower again today. Yesterday’s move lower on strong trading volume and a 10,000 contract drop in open interest signals some short covering. The southern plains are already facing excessive moisture with more rain to come. Winter wheat harvest progress is at 4% as of Monday, up 1% over last week. Thursday’s WASDE report estimates expect a slight increase in world carryout. The estimate for the USDA’s old crop figure is 842 mb and 924 for new crop. On the May WASDE report, the USDA came in at 841 mb for old crop and 923 mb for new crop.
ZWN25 Moving Averages – (544) 5-day, (536) 20-day, (541) 50-day, (562) 100-day, (577) 200-day
ZWU25 Moving Averages – (558) 5-day, (551) 20-day, (556) 50-day, (576) 100-day, (590) 200-day
KEN25 Moving Averages – (539) 5-day, (532) 20-day, (545) 50-day, (572) 100-day, (582) 200-day
MWN25 Moving Averages – (624) 5-day, (605) 20-day, (606) 50-day, (616) 100-day, (626) 200-day
The Commitments of Traders report for the week ending June 6th showed that Managed Money traders in the wheat market were net short -100,572 contracts, having decreased their short position by 654 contracts. Producer/Merchant traders added 2,550 contracts to bring their net position to 36,279 contracts. Non-Commercial & Non-Reportable traders were net short -99,069 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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