Grain Markets Update
The grain markets continue to show strength, and I remain bullish on key commodities. Let’s dive into the latest developments and my updated targets.
Soybeans: Soybean futures have been rising, bolstered by easing concerns over potential Chinese tariffs on U.S. soybeans. Recent trade tensions saw the U.S. imposing a 10% tariff on Chinese imports, with China responding with tariffs on various goods. However, soybeans were notably excluded from China’s tariff list, which has helped support the market. In my opinion, this adds to the bullish case for soybeans, and I maintain my target of $11.18.
Corn: Corn futures are seeing an uptick, driven by increased ethanol production. The USDA reported a significant boost in ethanol output, averaging 1.112 million barrels per day—the highest level since late November. With ethanol production a major demand driver for corn, I remain bullish on this market and set my target at $5.30.
Wheat: Wheat futures continue to gain strength amid dry conditions in key global producing regions, including the U.S., Europe, and the Black Sea area. Weather concerns and tightening supplies are supporting prices. While wheat remains volatile, the current conditions suggest continued upside potential. In my opinion, I maintain my target of $6.33.
Soybean Meal: I remain bullish on soybean meal, setting my ultimate target at $335. Strong soybean fundamentals and global demand for protein meal continue to provide underlying support.
Soybean Oil: Soybean oil has seen steady support, and I maintain my target of $50.00. The ongoing demand for vegetable oils and potential supply disruptions add to the bullish case in my opinion.
Final Thoughts: The grain markets are reacting to a mix of geopolitical developments, production data, and weather-related supply concerns. In my opinion, the underlying fundamentals support my bullish outlook on soybeans, corn, wheat, soybean meal, and soybean oil. Additionally, I have not seen any technical signs of reversals in the grain markets yet, further supporting my stance.
As always, this is just my opinion and should not be considered as financial advice. Market conditions can change rapidly, and it’s essential to stay informed and manage risk accordingly.
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John S. Simpson Jr.
Senior Market Strategist
Walsh Trading
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