Market Recap 2 Jul 2019

• USDA’s projected 91.7 million acres planted to corn this year. That was over 4.5 million acres above analysts’ average estimate
• The soybean area came in 4.6 million acres less than expected. If UDSA’s figures are correct, this will be the smallest soybean acreage since 2013.

• NASS will be resurveying farmer’s planting data for corn, cotton, sorghum, and soybeans in July. If the new survey data justifies change, the agency will issue an updated acreage report on Monday, 12 August.
• Weekly NASS crop conditions reported yesterday showed corn and soybeans unchanged at 56% and 54% G/E respectively which falls short of trade expectations of a 1-2% improvement.
• The latest weather forecasts show average or below-average temperatures for most of the Midwest in the next two weeks with average or above-average rain. The outlook isn’t good for fledgling crops, but it’s likely better than hot/dry weather.
• News was released last week that a new tax bill being debated in Paraguay would lower the VAT for exporters of soy crushing derivatives.
• President Trump and Xi had a “good” meeting at the G-20 Summit. The meeting prompted Chinese officials to claim additional purchases of U.S. agricultural products would soon occur, though details were not provided. The market’s expectation is that any such purchases will wait until after a deal is officially inked.
• The Export Inspections report did no favors for the corn market as it showed the continued effects of stiff global competition. The report was bearish corn and soybeans but moderately bullish wheat with YTD exports up 28 percent early in the marketing year.

Market Highlights CBOT | 2nd Jul 2019

Macros

• Wall street climbed on Monday, led by gains in tech. stocks on optimism for progress in U.S.-China trade talks
• Stocks still gave up a good portion of earlier gains as investors contemplated whether Fed Reserve would be as dovish as anticipated
• DJIA gained 0.44%, S&P increased 0.77%, Nasdaq advanced 1.06%
• Asian stocks rallied before Monday market close as investors priced in U.S.-China trade truce
• Asian markets are however, mixed on Tuesday morning as weak global manufacturing activity reinforced worries about slowing world growth
• Further dragging on sentiment was U.S. government’s threat on Monday of tariffs on $4b of additional EU goods
• Oil prices slip as demand worries outweigh OPEC supply cuts
• OPEC agreed on Monday to extend oil supply cuts until Mar 2020 as group’s members overcame difference to prop up price of crude
• OANDA: After 2 ½ years of production cuts, effects of rolling over production cuts is losing steam
• WTI at $58.61/bbl and Brent at $64.73/bbl

Corn

• CBOT: Sep corn declined 9 ¼ cents to $4.15 ½ /bu
• Traders remain uncertain how many acres were actually planted after USDA pegged planted acres well above trade expectations
• USDA: Export inspections pegged at 273kmt ; well below expectations of 500kmt to 800kmt
• USDA: Crop condition unchanged at 56% GD/EX, 1% below market expectations
• Maxar: Temperatures well above normal across corn belt over weekend; accelerating crop growth
• APK Inform: Corn exports expected to fall to 26.5mmt from 28mmt; due to a decrease in output from 35.8mmt to 34.8mmt

Wheat

• CBOT: Sep Chicago wheat slumped 15 ½ cents down to $5.11 ¾ /bu
• U.S. winter wheat harvest expanded amid drier weather and technical selling
• USDA: Export inspections pegged at 609kmt; topping trade expectations for 300kmt to 500kmt
• USDA: Winter wheat harvest at 30% complete by Sunday, up from 15% in last week’s report
• APK-Inform: Ukraine’s wheat exports to increase from 15.8mmt to 16.2mmt as harvest likely to rise from 24.6mmt to 25.7mmt
• IKAR: Cuts forecast for Russia’s wheat harvest and exports earlier on Monday
• Lowered estimate for Russian wheat exports in 19/20 season by 300kmt to 36.2mmt
• Cut forecast for Russia’s 2019 wheat harvest by 700kmt to 79.3mmt
• Saudi Arabia’s state grain buyer SAGO bought 730kmt of wheat for Sep-Nov delivery in latest international purchasing tender
• Wheat were bought at average price of $233.88/mt

Soy

• CBOT: Aug soybeans fell 14 ¾ cents to $8.89 ¾ /bu, Aug soybean meal down $8.10 to $307.20/st
• Soy futures retreated from early advances under pressure from improving weather that should bolster U.S. production prospects
• Traders also shrug off support from U.S.-China trade talks
• USDA: Export inspections pegged at 719.3kmt, near the high end of trade expectations for 450kmt to 750kmt
• USDA: Crop conditions unchanged at 54% GD/EX; 2% below market expectations

Cbot close 29 Jun 2016

CBOT Jun29
Lastchanges
SMN397.1+4.7
SMQ396.4+2.9
SMU393.7+1.6
SMV390.7+1.3
SMZ390.1+1.2
SMF7386.3+1.1
SMH7367.8-0.5
SN1144.5-6
SQ1140.5-5.75
SU1123-7.25
SX1112.5-7.75
SF71108.5-8.25
SH71073.5-7.25
BON30.82-0.29
BOQ30.98-0.27
BOU31.11-0.28
CN372.75-12.5
CU377.75-11
CZ383.00-11.25
WN429.50-14.25
WU444.50-12.75
WZ465.25-11.75

Most of the markets are lower this morning as cooler air crosses much of the Midwest,
producing some storms in its wake. Trends are becoming less clear as BREXIT
created some temporary lows, with what appears to be possible topping action as
well on most of the charts. Feels like the markets could wind up in the middle of
these ranges awaiting the very important USDA June acreage/stocks report tomorrow.
First notice day is also tomorrow, with possible high bean and corn deliveries.

Wheat futures remain pressured from harvest and continued talk about great yields. But
wheat will begin on a plus note as some traders cover in their shorts before tomorrow.
Wheat futures will gain on beans, while the corn/bean ratio corrects a touch with larger
losses in soy to begin the morning.

Here are the well advertised numbers for stocks/acreage in front of tomorrow's report:
Plantings
Corn: 92.896
Beans: 83.834
All wheat: 49.869

Stocks
Corn: 4.528
Beans: 0.829
Wheat: 0.982

The markets opened lower as called with grains still weaker against soy, and oilshare once again
weaker on the back of higher meal prices versus soyoil futures. Cooler weather and the
chance of better rainfall pressured the markets today as bulls took profits. Wheat markets
continued to trade to new lows on talk of excellent yields. Spread activity is still a high
percentage of volume as more traders exit July and nearby positions.

SOY
Soybean prices opened lower but found pricing interest and spillover support following meal prices higher. The key feature of the day was higher meal against a weaker soyoil market, taking Dec oilshare down to .2880%. Dec soyoil futures found spillover pressure from palm oil's hefty sell-off and negative chart patterns with the failed rally from yesterday which ended in a poor close.

GRAINS
The main feature on the board today was lower wheat. Sep CBOT wheat traded to new lows
for the move down at 4.45, triggering more selling pressure. Sep Kansas City wheat futures continued to post new contract lows trading down to 4.18 1/4c as reports of excellent yields and harvest pressure continues to weigh on the board. Funds were net sellers needing to also hedge against length elsewhere on the board. Corn bulls followed wheat's lead with funds selling into commercial pricing activity in an exchange of ownership. Better weather, negative chart signals, and the upcoming report tomorrow created pressure throughout the day. Sep corn traded through minor support triggering sell-stops below the market that took charts down towards the low of the last break towards $3.78. Dec corn started the day on weak note but also took out minor trendline support at 3.90 which led to a quick decline as well. Ethanol production was forecast higher, up 40,000 barrels per day while stocks were .3% higher.

Fund recap
sold 5000 wheat (from 4000 earlier)
sold 10000 corn (from 6000 earlier)
bot 2000 meal (from bot 3000 earlier)
sold 3000 soyoil

CLOSING COMMENTS
Prices remain defensive today as larger acreage may be confirmed tomorrow. Weather and ratings week-to -week will dominate price action. historically the fourth of July can be a turning point if more corn heads through pollination unscathed and large acreage is confirmed tomorrow. Funds are still long pretty hefty amounts of beans/corn. Today felt like a lot of nervous longs were starting to leave the market. Beans were pretty much left alone. If we go through July 4th with normal temps and more rainfall - and unchanged ratings, beans may still remain higher as compared to grains until we get through August. But tomorrow will be a most important day in terms of acreage and stocks. Watch the weather, ratings, and technicals.

CBOT closing 28 Jun 2016

CBOT Jun28
Lastchanges
SMN392.4+8.4
SMQ393.5+8.5
SMU392.1+8.7
SMV389.4+7.8
SMZ388.9+7.4
SMF7385.2+7.1
SMH7368.3+6.7
SN1150.5+17.5
SQ1146.25+16.5
SU1130.25+16.25
SX1120.25+15.5
SF71116.75+15.25
SH71080.75+16
BON31.11-0.15
BOQ31.25-0.15
BOU31.39-0.14
CN385.25+0
CU388.75-0.5
CZ394.25+0
WN443.75-3
WU457.25-1
WZ477.00-1

Prices are higher across the board this morning as we get closer to the end-of-month and the June 30 stocks/acreage report. Crop progress was released last night, in which bean conditions dropped 1% to 72% good/excellent. In the meantime, corn conditions remain stable at 75% good/excellent, unchanged from a week ago. That beat expectations given the heat and dry weather that has been prevalent over the last week. But at issue is the fact that topsoil ratings have declined nationally, meaning any period of dry weather would begin to actively impact the corn and bean crops.

The higher prices this morning along with "blow-off" bottoms suggests we now have our comfort zones heading into the June 30th report. The bean market pretty much blew off the weight of the macro world as each report has gotten increasingly bullish with lower carry-out numbers.
Exports and weather still hold the key to the future of each of these markets and both are fairly positive this morning. Corn and bean exports still remain robust, and the weather in July appears to still feature above normal temperatures.

Prices started the day higher but that strength seemed to fade with volume throughout the session. Wheat and soyoil futures were the weakest charts today in terms of price action.

November bean and meal prices started the morning at session highs but also found selling interest as prices held throughout the morning. Other features of the day included continuing strong inverses with August/Nov bean spreads trading to 27 1/4c. By midday, soyoil futures started to break down trading from 30 higher to lower on the day, taking oilshare back under the 29% level. Dec oilshare traded down to .2880% with crush vales also finding pressure.

Grains started the day on a higher note but by midday corn values were lower. Kansas City values continue to weigh on CBOT, as harvest pressure continues. SEp KC wheat traded to another new low of 4.29 1/2c. Spreads were also weaker with Sep/ Dec corn trading out to a 5 1/2c carry. Corn continues to run into commercial pricing interest as funds liquidate length on rallies of size.

Cbot closing 27 Jun 2016

CBOT Jun27
Lastchanges
SMN384+8.4
SMQ385+8.4
SMU383.4+8
SMV381.6+8.2
SMZ381.5+8.1
SMF7378.1+7.4
SMH7361.6+5.1
SN1133+30
SQ1129.75+28.25
SU1114+27.75
SX1104.75+26.25
SF71101.5+25
SH71064.75+16.75
BON31.26+0.27
BOQ31.40+0.27
BOU31.53+0.26
CN385.25+0.75
CU389.25+0.25
CZ394.25+0
WN446.75-8
WU458.25-6.75
WZ478.00-6.75

Let the divorce begin as Britain's exit from the European Union ripples throughout the markets. The divorce could be long and expensive, and the unknowns are sending bank stocks lower along with most global markets this morning, the exception being Asian markets. Willthe US follow Asia's lead to start lower and end higher? Hope so. IN the meantime, the Dow will begin its day with around a 200 pt loss.

Macro developments, stable ratings and sporadic Midwest rainfall hit the grain and soy markets hard last week, sending all out of their spring uptrends into trend changing lows. This morning the markets are higher as the downturn seemed to have sparked good commercial pricing interest.  Prices this morning begin higher across the board. Before last week, the market had yet to find its highs. Higher markets this AM suggest that current lows may be it as we head into end of the month.

The US dollar is firmer against a weaker Euro, with the British pound taking a further beating. Crude oil lows are $46.61/barrel against the safe haven commodity gold. This week looks to offer more volatility with the all important June 30 stocks/acreage report ahead which is also end-of-month. And despite the down-move in most of the markets, the fund futures/options position is still fairly steady (not as much fund liquidation as expected last week) with wheat the only short. Here is the break-down in estimated contracts:

wheat: short 69,200
corn: long 191,800
beans: long 185,000
soyoil: long 35,800
meal: long 52,800

The markets opened as called with the soy complex keeping gains intact. But wheat futures traded lower on the day weighing on corn. Today seemed to reflect the upcoming numbers on June 30 with a buy beans/sell corn and wheat psychology intact.

At 10:00 export inspections were released as follows:
soybeans: 272,066 tons vs. 314,382 wk ago
wheat: 511,701 tons vs. 571,724 wk ago
corn: 1,451,227 tons vs. 1,235,070 wk ago

Inspections were in line and better for wheat

The markets opened higher with soyoil futures gaining on meal prices. The nearby bean spreads inverted further with July /Nov beans trading up to 29 1/4 as more business announcements under-scored the bull spreading activity. August / Nov traded up to 27 1/4c highs. Canola prices followed soybeans higher, and higher rapeseed prices in Europe. Oilshare rose as soyoil futures rose vs. meal. Dec crush values continued steady at 85c/bu.

Wheat prices broke lower as a stronger US dollar would make this commodity uncompetitive on the global marketplace. Corn prices tried to strengthen following beans, but finally traded both sides of even as wheat values continued to break further. The Sep wheat/corn spread traded down to 69c early in the session, and then down to 66 1/2c. Sep /Dec wheat spreads widened out to 19 3/4c, while Sep/Dec corn carries narrowed into 4c from 5c. Later in the session Kansas City wheat led the market declines with CBOT following, which continued to weigh on corn prices. Corn did find good pricing as prices broke into lows under wheat's pressure.

CLOSING COMMENTS
Days when macros are at play reveal the true nature of each market. IF one thought that the bean market rally is over - think again, as price action divorced itself from all the other negatives on the board. The weakest market, wheat, cannot hold a rally of any sort. Days and events like this should be "read between the lines" day. IF beans were going to weaken further, they should have done it. Continue to price on good breaks.

Crop progress numbers will be released tonight. This will be interesting, as they are probably the first ratings to appear after the significant heat spell. Cooler temperatures this week could be countered by ratings should corn and beans decline more than expected leading to a turn-around Tuesday trade, and perhaps more trading range price action for beans, meal, and soyoil.

CBOT closing 22Jun2016

CBOT Jun22
Lastchanges
SMN391-2.3
SMQ391.9-1.6
SMU391.8-1.3
SMV390.4-0.9
SMZ391-0.5
SMF7387.5-0.3
SMH7369.3-1.9
SN1137.5+4.25
SQ1137.25+4.75
SU1123.75+6
SX1116.75+6
SF71114.25+6.75
SH71077.75-0.5
BON31.55+0.19
BOQ31.69+0.19
BOU31.84+0.2
CN393.00-3.25
CU398.25-4
CZ404.00-4.75
WN458.75+0.25
WU472.25-0.25
WZ493.00-0.25

Soybean futures are higher at midday with some light buying surfacing after the early week pressure. Upside momentum appears to have stalled. The forecast should boost growth with planting effectively wrapped up for first crop soybeans with the forecast showing better moisture for double crop areas this weekend. Heat looks to be more confined to the west for now. Ahead of the month-end report, more speculation about greater soybean acres should surface with the price spreads this spring. On the November soybean chart support is the 20-day moving average at $11.15, with resistance now the 10-day at $11.39.

Corn futures are flat to lower with position-squaring following the big break the past two days. Overnight we found support at the 50-day moving average which was nearly 45 cents below the highs printed last week. This is quite a break and brings us back to the middle of our 2016 trading range of about 90 cents. Trade will continue to watch from forecast to forecast with some concern about above normal temperatures continuing. The weekly ethanol production report showed production down 5% after record production last week, while stocks were down .3%. Ethanol is up 2 cents following the weekly EIA numbers at midday with unleaded down a penny due to weaker crude oil trade.

Wheat futures are narrowly mixed across the three contracts, with direction from the row crops providing some light support with harvest pressure likely building late in the session. Trade put in new contract lows again this morning on the KC contract. The winter wheat harvest will move along fast this week with warm weather and limited moisture for most of the belt, and yields have been very strong so far. World conditions remain good for the most part with India likely returning to the import market this summer.

CBOT closing 21 Jun 2016

CBOT Jun21
Lastchanges
SMN393.3-9.4
SMQ393.5-8.6
SMU393.1-8.5
SMV391.3-9.1
SMZ391.5-9.2
SMF7387.8-9
SMH7371.2-7.7
SN1133.25-10.25
SQ1132.5-12.75
SU1117.75-18.5
SX1110.75-22
SF71107.5-23.25
SH71078.25-21.25
BON31.36-0.28
BOQ31.50-0.28
BOU31.64-0.27
CN396.25-25
CU402.25-24.5
CZ408.75-25
WN458.50-14.5
WU472.50-15
WZ493.25-14.25 is

Extended weather forecasts continue to call for rains across much of the
U.S. Midwest, dropping corn contracts limit down. Additional pressure came from
renewed buying in the U.S. dollar index, put a squeeze on commodities in general.

NASS weekly crop condition ratings is viewed as neutral to bearish for soybeans and corn."
- Soybeans are 96% planted nationwide, compared to 92% last week, 89% last year vs  93% 5-year average. 
- 89 % of the crop is emerged, compared to 79% last week, 81% last year vs 84% 5-yr avg.
- Soybean conditions declined slightly to 73% good to excellent, compared to 745 last week.
- Corn condition stayed steady at 75% good to excellent.
- Winter wheat is 25% harvested, compared to 11% last week, 17% last year and 28% on average. Winter wheat condition held steady at 61% good to excellent.
- Spring wheat is 28% headed, compared to 19% last year and a 14% average. Spring wheat condition declined to 76% good to excellent, compared to 79% last week.

Soybean futures are lower due to improved weather forecasts and spillover pressure from corn. Meal is lower and oil is flat to lower. If weather continues to improve, we may have printed our highs here in beans. The most important time for beans is late July and
August, which is why corn is getting hit harder today since the next six weeks are the most important for corn. Rain makes grain and widespread late June rains would be viewed as favorable for the crop if they verify. The front-month spreads are firm, indicating that commercial demand remains solid for beans.

USDA announced 40,000 metric tons of soy oil sold to China, 132,000 mt of soybeans to China, and 126,000 mt to unknown. On the July soybean chart, support is the 20-day moving average at $11.32, with resistance now the 10-day at $11.60.

Corn futures are lower with trade remaining soft due to rains in the Western Corn Belt overnight. The Eastern Corn Belt forecasts are for better rains this week as well. On the break, we filled the gap around $4.20 on the December contract, picking up stops below that level, giving us negative midday momentum. Traders will continue to watch forecasts with some concern about above normal temperatures. Ethanol margins should get a boost from the setback in corn.  There were no crop progress numbers with planting
viewed as complete, and pollination/silking the next numbers we will start to receive each week.

CBOT closing 20Jun 2016

CBOT Jun20
Lastchanges
SMN402.7-4.7
SMQ402.1-4.6
SMU401.6-4.5
SMV400.4-4.6
SMZ400.7-4.6
SMF7396.8-4.4
SMH7378.9-2.6
SN1143.5-16
SQ1145.25-14.75
SU1136.25-15.5
SX1132.75-15.5
SF71130.75-15.25
SH71099.5-8
BON31.64-0.29
BOQ31.78-0.28
BOU31.91-0.28
CN421.25-16.5
CU426.75-16
CZ433.75-15
WN473.00-8.25
WU487.50-7.25
WZ507.50-5.5

Corn futures are lower with a cooler and and wetter forecast than Friday encouraging selling but some heat is still around. The forecast calls for good rains for much of the belt the next 7 days with well-above-normal temperatures only in the western edge of the belt, there is some model disagreement that will be watched closely by traders. Ethanol margins will likely stay under pressure for blenders and producers to start the week, although blender margins are better this morning with ethanol futures off 3 cents while unleaded is up 5. Crop progress is likely to show conditions down 1%-3%, with emergence near complete nationally. The weekly export inspections
were good at 1.265 million metric tons.

Soybean futures lower with trade 10-12 cents off the overnight lows with the wetter forecast encouraging selling. Meal is $3.50 to $4.50 lower, with oil 10 to 20 points lower. If weather continues to improve, the markets will likely focus on acres switched to soybeans from corn. Further export demand will be watched as well, as continued old crop sales will support the market as it would show continued struggles out of South America. The weekly export inspections improved at 314,990 metric tons. The weekly crop progress report is expected to decline slightly with planting near complete. On the July soybean chart support is the 20-day moving average at $11.28, with resistance now the 10-day at $11.60.

A weather induced strong close for corn last week Friday, was all but eliminated with today's price action.  Cooler forecast for the coming week and next seem to be the weather back drop the market is comfortable believing, at least as of today's close.  The soy complex has done little in the futures of late, with both oil share and board crush in more a consolidating mode.  Watched closely with of course be weather, but also pace of shipments of both beans and corn.  Today bean export inspections were a healthy number, but need to maintain that to make the trade believe that US will in fact ship out of the US enough beans to justify the drawn down of ending stocks seen in the last USDA S&D report.

This afternoon’s crop progress report 75% of US corn crop in good to excellent conditions, unchanged from previous week and 4% higher than last year. Soy beans at 73% good to excellent vs 74% last week, and 65% last year, same time.  So there is little input from this data.  Funds are "quite long" as a whole, with the Ag space, as of last Tuesday, long a net 479 th contracts, longest Fund position since 2014, a drought year.

CBOT closing 17Jun 2016

CBOT Jun17
Lastchanges
SMN407.4+9.7
SMQ406.7+10.6
SMU406.1+10.9
SMV405+10.7
SMZ405.3+10.7
SMF7401.2+10.9
SMH7381.5+10.6
SN1159.5+25
SQ1160+26.5
SU1151.75+28
SX1148.25+29
SF71146+29
SH71107.5+23.75
BON31.93+0.77
BOQ32.06+0.76
BOU32.19+0.75
CN437.75+12.5
CU442.75+12.25
CZ448.75+13
WN481.25+8.75
WU494.75+10
WZ513.00+8.75

GOOD MORNING,
Prices are higher this morning as the heat is here but the rainfall amounts remain questionable for next week.  Corn crops not in irrigated fields at this point may be challenged.  Consumers took the break last night as an opportunity to get something priced, and shorts in the market were electing to cover something this morning with the potential for prices to still bounce back.  While we define our trading ranges off the highs, we have yet to confirm a top in corn, beans, or meal.  Moral of story is that when prices drop, take advantage until we get more weather and acreage numbers via the June 30 report. 

Heading out the door tonight, the potential positions for the funds futures / options category looks something like this:

beans:  net long 210,000 (now back under record length)
meal:     net long 62,700  (pared back from the overall highs closer to 80,000)
soyoil;   net long 35,000  (vs. the core 45,000 over the last few weeks)
corn:      net long 213,000   (longer than in the last several weeks)
wheat:   net short 85,300    (slightly shorter)

As noted above, the tendency of the last week has been to pare back length in front of the June 30 reports and put more of a short hedge back in the wheat market as protection.  The sideways to lower trade in soyoil futures is creating more of an almost even feel to this market, particularly as compared to solid length in meal.

The markets opened at the strongest end of expectations and traded higher than expected at the open.  More chatter about lack of rainfall for next week is filtering across the marketplace.  Consumers continue to price on market breaks, recent bears are covering their shorts into the end of week.

SOY
Soybeans, meal and soyoil put in a strong opening day of trade which triggered small buy-stops and took prices into key first resistance levels.   July contracts continue to liquidate.  July bean open interest dropped by 13,337 with November picking up 5,060 contracts of open interest.   November bean open interest is the highest at 400,112 contracts with July meal open interest is down to 69,022.  July soyoil open interest stands at 87,178 contracts.   Crushers remain active though margins are quickly beginning to weaken, with Dec at 1.00c/bu but July back to 88c/bu.  Bean inverses remain well supported as they break with July /Nov and August / Nov trading down to 10c/bu.  Bean demand is still good, with diverse buyers in the market besides China.

GRAINS
Grains were higher led by corn.  Wheat futures tried to rally but key resistance levels held as prices firmed.  Wheat continues to be a follower of corn direction.  HRW harvest will be big this weekend, while SRW is expanding as well into the north.  Therefore corn seems more open to rallying over wheat for now until the crop pressure from harvest is alleviated.  That may occur after this weekend.   Corn prices firmed towards previous highs as traders remained concerned about hot temperatures and a lack of good rainfall over the next week.   Front month liquidation is still a good portion of the daily trading range volume.   July corn interest dropped by 22,519 contracts as traders continue to roll or liquidate length in front of first notice day.  September corn open interest now holds the most contacts at 516,534 followed by Dec corn at 459,503.  Corn exports still remain active, which brings support to the market when breaks occur such as saw this week.

Fund recap
bot 6000 corn
bot 6000 beans
bot 2000 meal
bot 2000 soyoil

OUTSIDE MARKETS
The Dow is down 20 pts with a slightly weaker US dollar.  Crude oil is very steady bouncing off a $45.83/barrel low.

CLOSING COMMENTS
Trading range activity with all eyes focused on weather, crop progress next week, and the June 30 report after that.  The markets continue to chop around in large ranges.  One thing to remember is that with South American supply down we cannot afford a big weather problem.  Charts still suggest that new highs could be out there if the weather is hot and dry - so take advantage of any hint of a weather change that promotes a good break as we saw this week.  If conditions begin to decline, we could quickly take out our highs.

CBOT closing 16 Jun 2016

CBOT Jun16
Lastchanges
SMN397.7-9.5
SMQ396.1-8.7
SMU395.2-7.9
SMV394.3-7.4
SMZ394.6-7.1
SMF7390.3-6.7
SMH7370.9-3.8
SN1134.5-21.5
SQ1133.5-21.5
SU1123.75-21.25
SX1119.25-19.25
SF71117-18.75
SH71083.75-13.75
BON31.16-0.8
BOQ31.30-0.8
BOU31.44-0.8
CN425.25-3.75
CU430.50-3.5
CZ435.75-3.75
WN472.50-5
WU484.75-4.75
WZ504.25-6

Prices are weaker this morning following through from yesterday's sell-off.  Charts are starting to look remarkably similar denoting some topping price formations.  Weather remains hot but rains are in the forecast next week.  The market feels like it is reaching the stage where it needs more information before it takes a further leg upward.  If the information is all bearish, the next direction could very well be lower as funds are long everything but wheat.  For sure they have been exiting the long side of soyoil, as we saw yesterday.  There are still plenty of consumers and others needing to get something priced who are waiting for setbacks such as this.  We are still in the process of setting back and buyers are still anxious to get involved which is one reason that while they break, the downside continues limited. 

Export sales were released this morning and they were actually the best for beans.  Other sales were neutral to low end.  In the macro element, global markets are actually higher which could lend a hand to a weaker Dow this morning, though applications for US unemployment benefits rose last week.    

Call are mixed this morning, weaker for soyoil futures which continues to head lower with July now under 32c.  Crude oil is weaker today as soyoil charts search for a bottom to this sell-off.

Funds are long corn, beans, meal, and smaller amounts of soyoil.  They remain short wheat.  And....... they are watching the weather closely.  This week's hot temperatures are due to break next week along with some rainfall.  But.....if the heat returns without precipitation we could take out our posted highs in a heartbeat.

The feature of the day was a correction in bean, meal and soyoil charts.   Soyoil weakness led the way down with funds taking profits on bullish positions.  Grains were largely ignored. 

SOY
Beans, meal, and soyoil futures sold off to lower levels of trade.  Inverses continued to leak lower for July /Dec meal spreads, dropping back to a 3.00 inverse from a morning high of 6.30.  July /Nov beans followed weaker trade with inverses setting back to 15 with a 21 3/4c high.  Dec oil share was weaker falling to .2872% on soyoil's weakness.  Chart prices continued weaker heading down to the only spot of support for Dec charts which was crossing at 3140.  For today the low of 3175 Dec was a new low for the move down.  The main reason for the lower move was due to weaker chart price action in recent days and an overly long fund position, where futures / options maintain near record length in beans and meal.   Crush values were weaker as meal prices dropped with Dec trading at 1.00c/bu.

GRAINS
Corn prices headed lower but at a shallower setback pace than in beans, meal, or soyoil.  Hot temperatures may impact corn right now and the funds are not long as much corn as they are beans.  Planting progress will continue to suggest whether we need to tack on gains next week or not.  Dec corn remained in correction mode on heavy fund selling into commercial pricing activity.  Sep/Dec corn carries were trading from a 5 1/4-6c carry.  Wheat futures were lower taking out the 100 day moving average. 

Fund recap
sold 10,000 corn
sold 9000 beans
sold 6000 meal
sold 7000 soyoil

CLOSING COMMENTS
Follow the weather, the planting progress and the charts.  Right now, consumers are still justified in buying breaks, as we begin the process of forming a trading range from the current tops. But we are still in the midst of hot and dry weather, and need to see adequate rainfall continue.  While charts look "toppy" (and therefore we are in the process of breaking lower) for beans and meal, they could still rally back.  The markets did get too saturated with length which means we define current trading ranges.  In the case of soyoil, at 3150 Dec we could be getting close to a cyclical low.

Cbot closing 15 jun 2016

CBOT Jun15
Lastchanges
SMN407.2-1.4
SMQ404.8-0.6
SMU403.1-1.1
SMV401.7-0.9
SMZ401.7-0.8
SMF7397-0.4
SMH7374.7-1.1
SN1156-13.5
SQ1155-11
SU1145-10.75
SX1138.5-10.75
SF71135.75-10.25
SH71097.5-7.5
BON31.96-0.56
BOQ32.10-0.57
BOU32.24-0.57
CN429.00-7.5
CU434.00-7.75
CZ439.50-7
WN477.50-7.5
WU489.50-8.25
WZ510.25-8

Prices are higher again this morning except for soyoil futures. The price action right now continues to speak to a consolidation phase, as prices break but not too much. In the case of Dec corn, we did post another new contact high overnight as more fears about hot and dry weather circulate along with lower (corn) acreage than what was posted for the March 31 report.  But the real reason for the setback is probably due to the June 30 number, which will tell the tale of acreage and stocks.

Macros are on the defensive with all eyes on what the Fed is going to do today. Crude oil however continues to trend down away from the $50/barrel level.

SOY
The feature of the morning in the soy complex was that of falling soyoil futures, which started out on trendline support but then wound up heading into sell-stops and a major correction lower. Palm oil and canola followed the path of soyoil. The sharply weaker soy oil market versus a steady meal market took Dec oilshare down to .2880%, under 29%. NOPA crush was released at 11:00 Chicago time and was large at 152.80 mil bu, While it brought some support back to beans, soyoil futures still remained the weak link on the day dragging beans lower. The July /Nov bean inverse weakened a touch, off 3c to trade to 14 1/2 up to 25 1/2. July /Dec meal inverses strengthened trading up to a $7.60 high.

GRAINS
Corn and wheat prices were lower today though not before Dec corn set a new contact high at 4.48 ½ at the start of the trading session. But those prices could not stick and funds were taking profits. On the break in corn, there was good commercial pricing activity which kept breaks rather shallow. Ethanol futures were steady after record production of 1,013,000 barrels per day, which was up 7,000 compared to a week ago. Sep/Dec corn spreads widened out to a 5 1/4c carry, with Sep/Dec wheat carries widening as well out to 21 1/2c. Corn and wheat losses were neck and neck as both markets corrected back to lower levels of trade.

Fund recap
sold 3000 wheat
sold 9000 corn
sold 6000 beans
sold 3000 soyoil

The Dow opened 40 pts higher in light turnover. Commodities such as crude oil and gold price are weaker along with the US dollar. The Dow remains cautious ahead of the June 23 referendum in which British voters will choose whether to leave the European Union.

CLOSING COMMENTS
Have to say saw the Cardinal beaten in a game where one could rightly call them flat. This market has the same flavor - sort of a been there, done that attitude with a cautious "show me something new". THe reaction to the crush number for example, was revealing. Beans and meal firmed then faded as funds start to use a rally to get out of some length in front of the USDA report on June 30th. Those are the types of small behaviors that one looks at if wondering if a trend has turned. Buyers still remain under the market for now, eagerly awaiting setbacks to get something priced or covered. This higher trade certainly has the feel of a market that is becoming a more cautionary instead of full throttle higher. If long and wondering whether to take a profit in this recent trade, probably not an altogether bad idea - and keep some in case weather remains hot and dry.

CbOT Closing 14 Jun 2016

CBOT Jun14
Lastchanges
SMN408.6+0.2
SMQ405.4-3
SMU404.2-4.2
SMV402.6-4.7
SMZ402.5-4.9
SMF7397.4-5.8
SMH7375.8-4.4
SN1169.5+0.5
SQ1166-3
SU1155.75-7
SX1149.25-9.75
SF71146-10.25
SH71105-10.5
BON32.52+0.01
BOQ32.67+0.02
BOU32.81+0.02
CN436.50+6.5
CU441.75+6.25
CZ446.50+6.5
WN485.00-6.25
WU497.75-5.5
WZ518.25-5

The markets opened lower and continued to find pressure through the day.  But consumers were also in the market waiting to take advantage of lower levels.   Buy corn/sell bean trade was dominant, though all the markets seemed to find price stability at lower levels from those needing to price something.  Funds were early sellers of corn, wheat, and soyoil futures early in the day, but by the noontime hour covered those shorts in.

SOY
THe major portion of volume yesterday was in spreading nearby contracts forward:  July bean open interest declined by 14,594 contract with November picking up the majority of turnover at 13,737 contracts.  November beans now has the majority of open interest at 386,326 contracts.  July meal was down 9,048 contracts with Dec picking up 9,420.  Dec meal open interest now is the largest at 134,361 contracts, though there are still 81,184 July contracts that need to be liquidated or spread.   The Goldman roll officially ended yesterday.  For the day, July /Nov bean inverses bounced off 10 1/4c rallying up to 21c while July /Dec meal inverses traded down to $1.10 before recovering to $4.20.   July soyoil futures traded down to 32c where it found light buying interest and chart stability.  July bean futures found support form corn, trading higher on the day from lower.

GRAINS
Most of the fund activity was in corn yesterday, where funds were purchasing contacts. But volume also continues to be about liquidating July contracts, and rolling them forward.  Yesterday July corn open interest dropped by 52,094 contracts with September up 34,911 contracts and Dec up 17,177 contracts.  Sep corn open interest stands at 483,432 contracts with Dec at 443,294 contracts.  Corn contracts held the best on the day, not giving back too much with wheat weakening the most Sep wheat fell below $5.00 to 4.93 1/4 where it found support.  Later in the session corn futures rallied once again leading the way upward

Fund recap
even    (from sold 5000 wheat)
even     (from sold 6000 corn)
sold 7000 beans
sold 5000 meal
even    (from sold 2000 soyoil)

The Dow started the day  20 pts lower and continued to trade in the red for much of the day.   All eyes on are the Fed that will look at interest rate direction and on whether Britain will vote to leave the European Union.

CLOSING COMMENTS
Now more than any time, the market bull has something to think about. What will be the next steps to a higher trade?  Good exports have been factored in - losses in SA have been factored in the next item is acreage.  For the moment the market continues to see support in one form or the other.  Today that comes from corn as consumers people needing to price something get something on the books.   Funds sold early but are quick to take a profit when it comes.  Continue to take advantage of breaks is the moral of this story until the trade is assured that our crops are safe and perhaps demand has softened.

CBOT closing Jun13 2106

CBOT Jun13
Lastchanges
SMN408.4-5.6
SMQ408.4-3.9
SMU408.4-2.9
SMV407.3-2
SMZ407.4-1.9
SMF7403.2-1.6
SMH7380.2-0.8
SN1169-9.25
SQ1169-8.75
SU1162.75-5.75
SX1159-3.75
SF71156.25-2.5
SH71115.5-2.75
BON32.51-0.25
BOQ32.65-0.25
BOU32.79-0.24
CN430.00+7
CU435.50+8
CZ440.00+9.25
WN491.25-3.75
WU503.25-3.25
WZ523.25-1.5

Friday's supply and demand report only contained bearish news for the wheat market, where funds continue to hold a net short of around 60,000 contracts futures / options combined. The soyoil futures / options position has remained steady week to week as prices remain stuck in a trading range, long around and estimated 48,000. Funds did increase their length in corn which is now around 194,000 contracts long, and with the heat crossing into much of the country of the country setbacks are finding support with values trending higher.  This morning, corn will open up strong as it approaches the peak high at last week at $4.39. Funds are also long around  242,000 futures / options beans, with price action trading up to 11.98 3/4 which approaches the spike high at 12.08 1/2 last week.

Macros: weaker crude oil and a defensive Dow could keep present the markets with a bit of a drag, though Ags seem to be trading in a world of their own now, particularly beans.
The well advertised bean planting pace is around 92-95% complete.

As funds continue to build length, it suggests that the acreage report June 30 is going to be a very big deal, and will create as much volatility as all the other reports have done since March 31. It could also be the first perhaps negative report since that time as well if weather looks good given the extent of this bean rally. But for today..........it's all about weather. And it's a hot one.

The market opened as called but much of the day's overall strength came out of the corn
trade. Nearby bean and meal contracts lost ground as July contracts continue to liquidate.
Dec corn, Nov beans, and Sep wheat now are the lead months. The Goldman roll (funds selling or spreading the front month into deferred) ends today.

Later in the session beans were pressured by low export inspections and Informa acreage numbers.

At 10:00 export inspections were released as follows:
beans: 136,506 tons vs. 98,9378 tons wk ago
wheat: 368,803 tons vs. 391,207 tons wk ago
corn: 1,696,990 tons vs. 1,067,586 tons wk ago
Corn inspections were impressive.

Informa was also released with higher bean acreage that seemed to pressure beans as the
trade will be more focused on acreage into the June 30 report:

- U.S. farmers will plant 83.8mil soybean acres in 2016, 755,000 acres higher than the firm's May forecast, and 1.5mil acres above the latest government forecast.

- Corn area in 2016 likely will total 92.6mil acres, which is 810,000 acres below Informa's prior forecast but still more than 5% more than the 88mil planted in 2015.

- U.S. wheat acres are estimated at a total 50.2mil in 2016, a decline of 4.5mil acres from last year. The firm pegged spring wheat seedings, other than durum, at 11.9mil acres, which would be 10% below last year.

SOY
The soy complex opened on a firm note but continuing liquidation in the July contract and higher bean acreage created a mixed trade from opening highs. November beans did manage to post a new contract high at 11.86 1/4, but the volume in front of what appears to be a week of mostly non-event reports created a profit-taking environment.

The Informa acreage number, higher than in May, certainly added to an air of profit-taking from the highs, while bean and meal spreads continued to get pressured throughout the day. Crush values were under 1.00c/bu for July and August, while Dec crush traded to 1.03c/bu. Soyoil values continued to have the most consistent defensive trade for the day as values approached the lower end of trading ranges - which for the July contract was at 32c.

GRAINS
Dec corn values set a new contract high at 4.46 3/4c before a round of profit-taking set in following weaker soy complex values. The highs set today in Dec corn at 4.46 3/4 reached double peak highs at 4.46 3/4c set back in July 2015. The lower INforma acreage was supportive, and unlike beans corn found good commercial / pricing interest as values traded lower from the contract highs. Corn also kept its premium versus wheat, with Kansas City wheat leading the way in terms of chart losses given the large acreage in the June 10 WASDE for HRW.

FUND RECAP
BOT 14,000 corn
Rest of activity: even

CLOSING COMMENTS
Definitely feels like the run-up is going to head in for consolidation time. Certainly the acreage number for beans from INforma was a "back to reality" moment, with prices lower but certainly not out of the bull market scenario. Think that would have to come from the report itself. Corn may take the lead for a bit from here, as beans have done a lot of work on the upside. Good export inspections for corn today, losses in Brazil, etc suggest that if one ,market is going to see support on setbacks, it could be this one.

Tonight - advertised corn ratings suggest that corn conditions may decline by 1% (from 75% good/excellent) with beans steady. This does not include the week of hot temperatures that we just moved through.