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Soybeans–
Soybeans had a nice move higher today, supported by strength in soybean oil and meal. It is likely there was some short covering today on such a strong move, up 20 cents. President Trump announced a trade deal with Vietnam and has hinted at making a deal with India. Weather forecasts show no major threats at this time. Weather will be important now that the June 30th reports are out of the way. The key pod setting time is in August for the soybean belt, so the next 60 days or so will need to be watched carefully in case of a weather shift.
Soybean crush for May came in at 203.7 mb, compared to the average guess of 204.9. Bean oil stocks were 1.876 billion pounds, in line with estimates.
Soybean exports for the week ending June 26th were 224k mt, at 91.1% of the USDA forecast. The 5-year average for this time of year is 88.3%.
August Soybeans (ZSQ25) settled at 1053 (+23), high of 1054, low of 1029. New crop November Soybeans (ZSX25) settled at 1048 (+20). Cash price is at 1010 (+12)
August Bean Meal (ZMQ25) settled at 276.8 (+3.1) high of 277, low of 271
July Bean Oil (ZLN25) settled at 55.02 (+1.36) high of 55.05, low of 53.78
The July Meal to Oil ratio (50.04% Meal – 49.96% Oil)
ZSQ25 Moving Averages – (1034) 5-day, (1050) 20-day, (1049) 50-day, (1042) 100-day, (1044) 200-day
ZSX25 Moving Averages – (1028) 5-day, (1038) 20-day, (1036) 50-day, (1031) 100-day, (1033) 200-day
ZMQ25 Moving Averages – (275.4) 5-day, (288.7) 20-day, (294.6) 50-day, (301.2) 100-day, (309.7) 200-day
ZLQ25 Moving Averages – (53.27) 5-day, (51.38) 20-day, (50.04) 50-day, (47.69) 100-day, (45.71) 200-day
The Commitments of Traders report for the week ending June 24th showed soybeans Managed Money traders sold -35,717 contracts to their bringing their net long total to 23,448 contracts. Producer/Merchants bought 25,042 contracts bringing their net short position to -146,800 contracts. Non-Commercial & Non-Reportable traders net position was 32,861 contracts.
The Commitments of Traders report for the week ending June 24th showed meal Managed Money traders sold -2,999 contracts, moving to a net short position of -110,080 contracts. Producer/Merchants bought 3,907 contracts bringing their net short position to -38,728. Meal Non-Commercial & Non-Reportable traders hold a short position of – 73,920 contracts.
For bean oil, the Commitments of Traders report for the week ending June 24th showed Managed Money traders were net long 44,319 contracts after selling -1,824 contracts. Non-Commercial & Non-Reportable traders net long position was 68,760 contracts.
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CORN –
September Corn (ZCU25) settled at 418 (+12), high of 418, low of 402 New crop December Corn (ZCZ25) settled at 433 (+11). Cash price is 434 (-6)
Corn had a higher closer today, up almost 12 cents. Corn doesn’t like to move by itself, and today it had support from the soybean complex and wheat. Celeres raised their estimate for Brazil’s corn crop to 147.6 mt, up from 135.4 mt in May. Ending stocks were also raised 20.5 mt, up from 16.3 last season. The USDA’s estimate is 130 mt. Brazil has a very strong crop ahead that will compete with U.S. exports. The dollar has continued to fall which helps U.S. exports stay competitive.
For the week ending June 26th, exports were 1.3 mt at 83.2% of the USDA forecast. The 5-year average for this week of the year is 76.1%.
ZCU25 Moving Averages – (409) 5-day, (420) 20-day, (428) 50-day, (440) 100-day, (441) 200-day
ZCZ25 Moving Averages – (425) 5-day, (435) 20-day, (441) 50-day, (449) 100-day, (447) 200-day
The Commitments of Traders report for the week ending June 24th showed that corn Managed Money bought 2,506 contracts bringing their net position to -182,282 contracts. Producer/Merchants bought 2,113 contracts bringing their net position to -61,180. Non-Commercial & Non-Reportable traders net short position was -183,120 contracts.
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WHEAT –
July Chicago Wheat (ZWN25) settled at 537 (+8), with a high of 540, low of 526. September Wheat (ZWU25) settled at 549 (+10). Chicago Wheat has a cash price of 528 (+10). September KC Wheat (KEU25) settled at 542 (+11).
Despite harvest pressure in the U.S., Russia, and Ukraine, wheat was able to rally with the other grains. Open interest rose 10k contracts yesterday, likely showing that some shorts were covering. We likely saw some more short covering today ahead of the long weekend. It will be interesting to see how wheat performs next week as it has had a series of strong moves in either direction, with funds loosening up their position some. EU and Russian wheat prices are weak, at the moment, therefore any rallies in Chicago only hurt export competitiveness.
Wheat exports for the week ending June 26th, were 434k mt at 5.7% of the USDA forecast. The 5-year average for this time of year is 6.2%.
The March-May timeframe showed the 5th-lowest usage on record for wheat, indicating a demand problem.
ZWU25 Moving Averages – (545) 5-day, (556) 20-day, (551) 50-day, (570) 100-day, (586) 200-day
ZWZ25 Moving Averages – (567) 5-day, (578) 20-day, (573) 50-day, (592) 100-day, (605) 200-day
The Commitments of Traders report for the week ending June 24th showed that Managed Money traders in the wheat market were net short -64,667 contracts, having decreased their short position by 16,686 contracts. Producer/Merchants sold -12,361 contracts to bring their net long position to 14,209 contracts. Non-Commercial & Non-Reportable traders were net short -75,195 contracts.
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Hans Schmit
Account Executive Walsh Trading
Direct 312-765-7311
Toll Free 800-993-5449
Fax 312 256 0109 fax
hschmit@walshtrading.com
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