SOYBEANS –
The weather forecast for the upcoming week shows rains for the South, with the Plains and Midwest drier along with cooler temperatures.
Soybean oil has been the highest performing commodity in the grains and the second-highest performing commodity overall year-to-date behind gold. Soybean oil is up +22% year-to-date, gold at 27%. Managed money reduced their position on the latest COT report, but soybean oil could still move higher with any biofuel news from the White House. T funds are at a record long in meal, while the funds decreased their soybean position to the least bullish in 6 weeks.
In South America, Argentina harvest is 74% complete, according to the Buenos Aries Grain Exchange
Looking at technicals, support is at 1056, resistance is 1067.
July Soybeans (ZSN25) settled at 1062 (+2), high of 1067, low of 1059. New crop November Soybeans (ZSX25) settled at 1050 (+0-2). Cash price is at 1045 (-8)
July Bean Meal (ZMN25) settled at 296.3 (+0.1) high of 298, low of 293.5
July Bean Oil (ZLN25) settled at 49.57 (+0.22) high of 50.18, low of 49
The July Meal to Oil ratio (54.45% Meal – 45.55% Oil)
ZSN25 Moving Averages – (1061) 5-day, (1055) 20-day, (1042) 50-day, (1049) 100-day, (1046-0) 200-day
ZSX25 Moving Averages – (1050) 5-day, (1037) 20-day, (1025) 50-day, (1032) 100-day, (1033) 200-day
ZMN25 Moving Averages – (295.5) 5-day, (295) 20-day, (298) 50-day, (306) 100-day, (312) 200-day
ZLN25 Moving Averages – (49) 5-day, (49) 20-day, (47) 50-day, (46) 100-day, (44) 200-day
The Commitments of Traders report for the week ending May 20th showed soybeans Managed Money traders sold -25,753 contracts to their bringing their net long total to 12,654 contracts. CIT traders were net long 157,869 contracts after increasing their already long position by 6,032 contracts. Non-Commercial No CIT traders were net short -18,873 contracts, having increased their short position by -27,822 contracts. Non-Commercial & Non-Reportable traders net position was 31,510.
The Commitments of Traders report for the week ending May 20th showed meal Managed Money traders sold -4,721 contracts, moving to a net short position of -107,466 contracts. CIT traders were net long 76,190 contracts after decreasing their long position by -1,955 contracts. Non-Commercial No CIT traders were net short 90,785 contracts after increasing their long position by 4,511 contracts. Meal Non-Commercial & Non-Reportable traders hold a short position of – 64,844 contracts.
For bean oil, the Commitments of Traders report for the week ending May 20th showed Managed Money traders were net long 57,309 contracts after selling -10,123 contracts. CIT traders were net long 138,397 contracts. Non-Commercial No CIT traders net sold -6,751 contracts, to a net with a total of -97,536 contracts. Non-Commercial & Non-Reportable traders net bought 71,573 contracts.
CORN –
July Corn (ZCN25) settled at 459 (unchanged), high of 463, low of 456. New crop December Corn (ZCZ25) settled at 446 (-4). Cash price is 466(-3)
Corn closed unchanged today, with planting progress coming out this afternoon with expectations at 75% good/excellent for NASS’ report. There is no need for a weather premium in the market at this time, with forecasts for the next 2 weeks showing no extreme heat. Rain is expected to be heaviest in the South, while the Plains and Midwest start to dry up. It is likely that corn breaks it’s April high at some point during June.
Over the past 17 years, new crop corn makes its summer high most often in June, this was true 7 of the last 17 years. Higher prices could be ahead for a number of reasons. Dec corn is still 20 cents below its spring insurance price, which is a target that the corn price often reaches. There’s still plenty of wet acres in the southern parts of the plains that should have lower than projected production. Total yield from the USDA could still be too high and exports may be underestimated.
ZCN25 Moving Averages – (463) 5-day, (455) 20-day, (458) 50-day, (465) 100-day, (437) 200-day
ZCZ25 Moving Averages – (450) 5-day, (444) 20-day, (449) 50-day, (454) 100-day, (448) 200-day
The Commitments of Traders report for the week ending May 20th showed that corn Managed Money traders reduced their position by -18,234, bringing their net short to -103,210 contracts. CIT traders decreased their net long position by -19,329 contracts to a long position of 313,094 contracts. Non-Commercial No CIT traders sold -3,408 contracts, to a net short position of -189,799 contracts. Meanwhile, Non-Commercial & Non-Reportable traders net short position was -97,678.
WHEAT –
July Chicago Wheat (ZWN25) settled at 528 (-14), with a high of 544, low of 527. September Wheat (ZWU25) settled at 544 (-13). Chicago Wheat has a cash price of 540 (-2). July KC Wheat (KEN25) settled at 524 (-14). July Spring Wheat (MWN25) settled at 596 (-10)
The wheat market closed below the 50-day moving average for the third straight day. It looks like bulls are starting to lose momentum. The main reason for the decline today is because rain is back in the forecast in China while Russia is expected to be dry and hot mitigating their frost conditions. Analysts were watching weather conditions in China’s Henan and Shanxi, and Russia’s Rostov region. Australia is holding on to a big wheat crop due to reduced demand from their big buyer China.
Managed money reduced their net short positions by 18k contracts on Friday to a total net short of -80k contracts.
July Chicago wheat support is at 525, resistance is at 557 and 565.
ZWN25 Moving Averages – (542) 5-day, (531) 20-day, (546) 50-day, (564) 100-day, (579) 200-day
ZWU25 Moving Averages – (557) 5-day, (546) 20-day, (561) 50-day, (578) 100-day, (592) 200-day
KEN25 Moving Averages – (536) 5-day, (528) 20-day, (557) 50-day, (576) 100-day, (584) 200-day
MWN25 Moving Averages – (601) 5-day, (595) 20-day, (605) 50-day, (614) 100-day, (627) 200-day
The Commitments of Traders report for the week ending May 20th showed that Managed Money traders in the wheat market were net short -80,162 contracts, having decreased their short position by 18,002 contracts. Wheat CIT traders reached a long position of 39,071 contracts, increasing their long position by 2,055 contracts. Non-Commercial No CIT traders were net short -99,289 contracts after net buying 16,24- contracts. Non-Commercial & Non-Reportable traders were net short -105,792.