Wkly Futures Mkt Summary June 24.24

SOYBEANS

After making 2 ½ year lows late last week on November futures, prices are bouncing slightly to start the week on flooding concerns in southeast South Dakota, southern Minnesota, and northwest Iowa, where 4-8 inches of rain has fallen in the last 72 hours.

The 6-10 day forecasts have above normal precipitation for most of the Midwest, with temperatures above normal in the southeast bean belt and below normal in the northern Midwest. The 8-14 day outlook is similar, but above-normal temperatures move north to cover the southern half of the soybean belt. Overall, the outlook appears less threatening for the eastern bean belt than Friday’s forecast. Flooding doesn’t typically garner the kind of bullish weather reaction that heat and drought do, and we doubt the market can sustain a rally with the current weather forecasts. However, technical indicators are significantly oversold, and a short-coverage bounce into the USDA report at the end of the week is possible. Look for heavy resistance above 1145 on November futures.

SOYBEAN MEAL

The end of the quarter, end of month, and USDA’s release of the Quarterly Stocks and Acreage report on Friday this week are expected to increase trading volatility.  USDA announced a large sale of 228,000 tonnes of US meal to the Philippines for the 2024/25 crop year Monday morning. The announcement is supporting soymeal prices and is one of the largest meal morning flash sales we have seen in quite some time and confirms US competitiveness off the Pacific Northwest Coast.

The soy complex is not seeing much weather risk premium as price action has been weak, and adverse Midwest crop conditions need to be more widespread to get Managed Money funds to cover their short positions. Commitment of Trader’s data is delayed due to the holiday last week and will be released Monday afternoon. Bean acreage is expected to come in around 86.753 million acres Friday, slightly above the 86.51 in the March intentions report and well above last year’s 83.60.

CORN

December corn continues to slip lower to start the week as the US Midwest forecast looks less threatening than Friday’s outlook. Excessive rains fell in southeast South Dakota, northwest Iowa, and southern Minnesota over the last 72 hours, and there have been many reports of flooding in those areas. The 10-day outlook shows rains a little further into the eastern belt, especially next week, and above-normal temperatures in the 6–10-day forecast are pushed into the southeast corn belt. In the 8- 14-day outlook, warmer temps shift back north to cover the southern half of the corn belt.

Ukraine says they have exported 28.4 million tonnes of corn for the marketing year, which ends this week, compared to USDA’s forecast of 26 million tonnes. The Buenos Aries Grain Exchange says the Argentine corn crop is 49.3% harvested. Last week, weekly export sales were below guesses and in another blow to the bull camp, South Korea bought South American corn rather than US. On Friday of this week, USDA will release the June quarterly stocks and acreage report and it is also end of month and end of quarter, which may add to the volatility late this week.

WHEAT

Last week’s bearish action on wheat continued this morning, and a lower close today would make 17 of the previous 18 trading sessions with a steady/lower close. Technical indicators are extremely oversold, but most recent fundamental news has been bearish.

Good overall yield reports from the US harvest, less threatening Black Sea weather, and weakening Russian prices are all weighing on the market. This afternoon, winter wheat harvest progress may reach 40% complete as hot, dry weather in the southern Plains has been ideal to keep the combines moving. The Russian Ag Minister kept the Russian wheat crop production estimate unchanged at 86 million tonnes, but they said it could be adjusted later. USDA’s latest number was 83 million. Last week, Russia’s Ag Minister said he expects their grain exports to grow by more than 25% by 2030. Showers in southern Russia have reduced the driest area to less than 20% of the crop area, and temperatures have moderated. However, very early yields in the Rostov region came in well below a year ago. An Indian government official says they will maintain limits on how much wheat can be stored by producers and agribusiness companies to limit hoarding through March 2025. He went on to say a reduction or elimination of the wheat import duty could be used if need be but said there is no shortage at this time.