CBOT closing 31 May 2016

CBOT May 31
Lastchanges
SMN396.6-6
SMQ385.3-3.4
SMU378.7-2.4
SMV373.5-2.4
SMZ372.1-2.1
SMF7365.3-1.6
SMH7349.9-1.7
SN1078.5-8
SQ1076.5-6.5
SU1064.25-3.25
SX1055.75-0.5
SF71053-1
SH71031.25+0.75
BON31.82+0.34
BOQ31.94+0.33
BOU32.05+0.31
CN404.75-8
CU406.75-7.5
CZ408.50-5
WN464.50-17
WU475.50-16.25
WZ493.50-14.75

All three grains closed lower Tuesday with the biggest losses posted in wheat. Prices were pressured by a more favorable forecast for much of the Corn Belt with extra bearish influence from Tuesday's higher U.S. dollar.

    Soybean trade lower, with early gains giving way. Some profit taking by bull spreaders is pressuring the front months. Meal is lower while oil is up. Planting should be able to progress this week with weather opening up the second half of the week. Prices remain very strong in South America which should help U.S. export demand with the USDA announcing old-crop sales of 213,000 mt. Planting progress should be around normal levels, and weekly exports inspections were low at 204,303 mt.
On the July soybean chart the 10.98 2015-2016 high printed Thursday is chart resistance with $10.75, the 10-day moving average, first support then the 20-day at $10.62.

Wheat trade lower across the three markets with Chicago leading the weakness. Improved conditions with southern winter wheat harvest just around the corner is noted for the pressure. The dollar is a bit stronger, which is limiting gains as well. World weather remains good with only isolated areas of concern, and drier weather expected to get harvest going soon on the Southern Plains. The dry Prairies of Canada received some rain but the forecast trends warmer and drier again. The weekly crop progress report should show a slight decline in conditions with above normal maturity and growth.
The weekly export inspections improved a bit at 494,842 mt.

Corn trade lower due to spillover pressure from wheat and soybeans along with better weather forecasts and lackluster export inspections. Weather looks to be more clear this this week which should allow for better crop development going into June and finishing up some late plantings. Some acres may be switched to beans. Ethanol margins remain stable to start the week with usage likely to rise for summer.
The weekly export inspections were disappointing at 786,407 mt. The weekly crop progress report is expected to show planting progress near complete, with emergence ahead of normal, and intial crop conditions very good overall.

CbOT 27 May 2016

CBOT May 27
Lastchanges
SMN402.6-7
SMQ388.7-4.4
SMU381.1-0.3
SMV375.9+1
SMZ374.2+1.3
SMF7366.9+1.5
SMH7351.6+0.8
SN1086.5+6.75
SQ1083+5.75
SU1067.5+5.75
SX1056.25+5.75
SF71054+7
SH71030.5+4.75
BON31.48+0.44
BOQ31.61+0.45
BOU31.74+0.44
CN412.75+4.5
CU414.25+3.75
CZ413.50+3.75
WN481.50+0.25
WU491.75+0
WZ508.25-0.25

GOOD MORNING,
The weather continues wet but mild in the St. Louis area.  Good news for farmers when it stops raining.  The lawns are looking fantastic everywhere.  But the funds are still sticking to their long positions in corn and beans, fueled by business announcements and soaring crush values.  The set-up for today finds us fairly close to yesterday's settlements, but no doubt as its Friday we begin the process of evening up our positions.  The futures/ options combined appears as such estimated in contracts:

beans:  long 195,000
meal:    long 99,000
soyoil:  long 46,000
corn:  long 82,000
wheat:  short 75,500

Interesting statistics above include the fact that meal is the closest to its all-time record length of 101,618 contracts.  The soyoil position has remained steady over the last few weeks, while corn length has been extended.  Beans are about 50,000 or so away from their all-time length in this category.

We will trade positions today with funds making the appropriate adjustments which includes nearby spreads.  They are weaker this morning with soyoil futures stronger against meal.  Other adjustments could include a bit of sell corn /buy bean trade. 

The Dow is called higher and is coming once again quite close to the 18,000 level.  The US dollar is firmer and crude oil, which traded over $50/barrel, is back-pedaling.

On the calendar - fund rolls begin this week and continue into the first few weeks of June.  July contracts will be moved to deferred contracts, and you can check your appropriate fund to see whether they are spread to the closest contract or farther back.

Prices started the day as called with noted new highs in corn, and more profit-taking in recent spread trade. 

SOY
The soy complex prices were mixed with profit-taking in the meal market, particularly for the July contract.  Beans followed a stronger soyoil futures market creating a floor under the monthly lows for oilshare which climbed back to 28%.  Crush values fell on meal's correction with July at 1.49c/bu and August at 1.24c/bu.  Canola prices were much lower today as better rains are expected to emerge for the crop.  July beans were operating mostly in the green today with November values up 3c as spreads corrected.  Nov beans highs for the move were 10.79 1/2 with prices stabilizing today from $10.55.   Nearby spreads were a touch weaker with July /Nov trading between 25 1/2 up to 30c inverse.  July /Dec meal inverses were between a 37.10 high and a 27.20 low, down 8.50 or so for the day.    Beans remain supported with Argentine harvest behind and yields continuing to show deterioration with high moisture levels.  Meal setbacks are continuing to see support from uncovered users and buyers who remain mostly spot given today's higher prices.

GRAINS
The major feature in grains was the continuing strength of the July corn contract, which set a new high for the move upward at $4.12 today.  The U.S. continues to gain more international share, with Brazil's corn crop still under stress and reported production amounts forecast lower on a weekly basis.  July  / Sep corn carries strengthened, trading into a 1/4- 1 3/4c carry.  By contrast wheat prices were lower but also traded higher briefly in somewhat low turnover. There is talk emerging now about too wet conditions for winter wheat, and some continuing talk of stripe rust and other disease issues emerging for crops.  But today's price action for wheat was mostly technical, with prices continuing to be mostly on the defensive with good global supply weighing down rallies.  The July wheat/corn spread moved to 74 1/2 with a 69 1/4c low.

OUTSIDE MARKETS
The Dow opened 8 pts higher and rallied to 34 pts in light turnover.  The US dollar was a touch firmer with crude oil still attempting to test the $50/barrel benchmark again..

CLOSING COMMENTS
Good technical price action in beans continues with corn prices catching up.  Wheat prices just continue to react to the other markets, making it ripe for selling.  Soyoil prices are correcting upward against meal.  But when we return, the focus is going to switch to acreage in a big way - and which crop has gotten planted in a timely manner.  We may be gaining big bean acres, but we won't know that for awhile.  And that will keep the funds engaged on the long side (except for wheat) until we get more clarification about demand and crop progress.

CBOT closing 26 May 2016

CBOT May 26
Lastchanges
SMN409.6+2.4
SMQ393.1+2.7
SMU381.4+2.1
SMV374.9+2.2
SMZ372.9+2.4
SMF7365.4+1.2
SMH7350.8+1
SN1079.75-5.75
SQ1077.25-4.5
SU1061.75-3.75
SX1050.5-3.75
SF71047-1.75
SH71025.75+0
BON31.04-0.3
BOQ31.16-0.3
BOU31.30-0.3
CN408.25+3.5
CU410.50+3.25
CZ409.75+1.25
WN481.25+15.25
WU491.75+14.5
WZ508.50+13.5

GOOD MORNING
More strength around the board yesterday with funds continuing to add bean and meal length to their portfolios.  Farmers are participating in the rally to a lesser extent as they are out in the field planting.  Global holidays begin today - with Memorial Day on Monday.  We will open higher on technical follow-through with chartists looking at positive chart signals from bull flag break-outs (beans) to busting through the top of uptrend channels (meal).  July beans hit a new contract high this morning at $10.98 while July meal traded up to 419.80.  July corn finally posted a new high at 4.09 1/4 versus the May 10th high at 4.07 1/4.  Wheat remains unattended, though small shortcovering activity was noted due to strength around the rest of the board.  And soyoil futures joined higher price action supported by a bust upward through the $50/barrel crude oil level and higher palm.  FYI, Rolls from July to deferreds will begin this week into next which will make spread activity quite interesting.

- Export sales were released today after the continued flashes were noted this week for beans, corn and soyoil.  They were good to very good for everything but wheat.  We open higher this morning on technical follow-through to the upside with charts guiding the price action:

- The Dow will also open higher as it makes a huge sideways trade between 16,500 and 18,000.  And that's fine by this writer as long as it stays that way without exit to the downside.  Higher crude will put a floor under equities again, even as commodities continue to come to life from 2009 lows.

The markets traded higher on the day but profit-taking was noted from the start of the day with corn, meal and soyoil futures in the red shortly after the start.  Coincidentally so were macros with stocks down around 10:00.  

SOY
The bean and meal markets set new highs for the move upward with an early round of profit-taking, as often happens in markets that have established higher trends.  There were also setbacks in the inverses but those pullbacks were met with buying interest.   July /Nov beans inverses traded from a low of 28 1/2 to 33 3/4 while July /Dec meal started the session at  32.60 but worked back up to $45.00 again.   Will be interesting to see how the rolls play out which will begin tomorrow.   In terms of total open interest, CME July bean futures stood at 389,703 contracts this AM followed by November at 281,895 contracts. July meal open interest stands at 163,420 contracts followed by Dec at 82,376.  Canola futures could not catch up with the other markets, mirroring a weaker soyoil trade off by 3.30 to trade to a 518.10 low.  Buy meal /sell soyoil trade once again became the major feature taking July oilshare during the trading session to yearly lows at .2724%.  July crush set a new contract high for this time of the year at $1.72c/bu.

GRAINS
The rolls will begin this week spreading or liquidating July contracts.  Jul corn open interest stands at 628,160, with December the next month having the most open interest at 350,778 contracts.  Wheat firmed with small shortcovering activity as well as a correction in the July wheat/corn spread which firmed to 70 1/2 from 62 1/4.  Wheat continued to gain on corn throughout the morning. Kansas City values were also trading higher as adverse weather moved through the southern plains.  But Kansas and CBOT values were higher by similar amounts, up 11-12 by midday.  

Fund recap
bot 4000 wheat  (from 2000 earlier)
sold 5000 beans
sold 4000 soyoil (from 2000 earlier)
bot 7000 corn
bot 5000 meal

CLOSING COMMENTS
Traders continue to watch volatility grow in the bean and meal markets.  For sure buyers / traders who are short are feeling the discomfort and using setbacks to get out of positions.  Technicals in beans and meal continue to be so strong - that until we see a key reversal hard to call a top though there does feel like panic sometimes as we reach a new crest.   Traders now want to see confirmation that the plants are safely in the ground and healthy before they retreat.  By July 4 we will find out a great deal about acreage and crop health, but till then, fade these markets at your own risk.

CBOT closing 25 May 2016

CBOT May 25
Lastchanges
SMN407.2+18.3
SMQ390.4+14
SMU379.3+9.7
SMV372.7+9
SMZ370.5+8.8
SMF7364.2+7.4
SMH7349.8+5.4
SN1085.5+30.75
SQ1081.75+28.75
SU1065.5+26
SX1054.25+25
SF71048.75+22.25
SH71025.75+16.25
BON31.34+0.45
BOQ31.46+0.44
BOU31.60+0.47
CN404.75+7.25
CU407.25+7.25
CZ408.50+5.75
WN466.00+2
WU477.25+2.25
WZ495.00+1.75

GOOD MORNING,
Trade is going to thin out from now into next Monday night.  South America is on holiday soon and US markets soon to follow.  The relentless theme of strong meal with all else following continues today.  Calls are higher across the board with July meal once again in strike of new contract highs after breaking hard this week to alleviate overbought (too many longs) this week.  Despite CME raising margins, meal prices are called higher again with beans following and soyoil finding a nice level of support.  Soyoil prices are also finding validation this morning from higher crude, which posted a new high at $49.95 (no doubt we hit the magical $50/barrel mark, just a matter of time), higher canola, and higher palm.

Weaker Chinese Dalian Exchange prices were said to have been the major force at work for Mon/Tues meal and bean break.    Now, a newswire reported that China may open its commodities futures markets to overseas and financial investors.  Just what the markets needed - right?  More volatility.  At any rate,macro markets are happy today with not only commodities higher but many global stocks as well.

Have to be careful today as the herds of money are thinning in front of the holidays and therefore we could see more exaggerated trade in lower volume.  But we will open higher on a no-doubter day.  The many business announcements over the last several days for corn, beans, and soyoil suggest that we could remain firm in front of export sales out tomorrow - then followed by an end of week profit-taking session.

The markets opened higher and funds were back to buying again.  July meal posted a new contract high once again, triggering stops in the process.  Grains came along for the ride at a snail's pace particularly wheat.  The corn/bean ratio traded up to 2.68 today.  

SOY
The opening feature of trade was the rebound in the meal market, which traded down to new lows this week and like a sling-shot traded back to new contract highs with July climbing past all resistance levels to 408.30, a level that sparked an overbot signal at its highest level this season at 79%. Fund buying accelerated then in the soybean market as it tried to keep pace, also trading back towards previous trading range highs placed on May 10th at 10.94.    July soyoil rallied but more modestly so which pushed July oilshare back under 28% to .2778%. Crush values soared with July staging an advance to 1.57c/bu and August at 1.21c/bu, setting new seasonal all time highs.    The July / Dec meal inverse traded to a $39.90 high with July /Nov beans at a 34c high, close to the peak of 39 1/2.  July /Dec soyoil spreads moved to a 67 pt carry.

GRAINS
Wheat futures trade appeared to be mostly abandoned today with all the volume and price action in markets elsewhere.  Since higher markets need volume, the lack of interest in wheat had prices moving mostly firm but modestly so.  July wheat /corn moved to 62c on the strength in corn.  July corn prices advanced past $4.00 which once more attracted more buying enthusiasm while nearby spreads continued to strengthen with July /Dec at 3 1/2c carry.   

Fund recap
even wheat
bot 6000 corn
bot 8000 beans
bot 5000 meal
bot 2000 soyoil

CLOSING COMMENTS
The trade today is positive, macro and Ags alike.  Consumers in the soy complex are clearly using corrective price pullbacks to get something on the books.  The speed of this day-to-day rally is really prompting the question of how many other consumers out there needing to price.  And that could be the real issue as breaks continue to see support with beans / meal roaring back.  Don't think this rally will lose much steam into the close.  Friday may still be the best day for profit-taking

CBOT closing 24 May 2016

CBOT May 24
Lastchanges
SMN388.9+1.2
SMQ376.4-1.1
SMU369.6-1.9
SMV363.7-2.6
SMZ361.7-2.9
SMF7356.8-3.5
SMH7344.4-3.3
SN1054.75-3.75
SQ1053-4.75
SU1039.5-6
SX1029.25-7
SF71026.5-7
SH71009.5-6.75
BON30.89-0.26
BOQ31.02-0.24
BOU31.13-0.25
CN397.50-0.25
CU400.00+0.25
CZ402.75+0
WN464.00+2
WU475.00+2
WZ493.25+2.25

The feature of the week is starting to be about fund position - evening into the 3 day weekend.  Meal prices started the day yesterday by moving quickly higher and then lower, with the erratic behavior more indicative of a temporary top than new highs that can sustain and indeed we ended the day in the red.   That set the tone for what we are seeing today, which is a corrective pullback where the market has the largest long positions namely meal and beans.  July beans broke the lows of the last break at $10.52 with crossing lines of support now evident at $10.38.  Meal prices triggered sell-stops under key support yesterday at 286.00 which sent it under key chart support points at 381.00, (which by the way is also against a trendline support value).  Given the massive run higher, we could still head under these values and not disturb the uptrend that has been intact since April 1.

Corn values this morning are weaker but not giving up much ground given the rains moving across the Midwest and an 85% complete planting pace.  The eastern cornbelt is the area most behind pace, up 13% to 77% complete. Beans advanced 20% to 56% complete, but the eastern cornbelt is still behind.  US spring wheat is 95% planted vs. 77% a year ago.      

Calls today are lower across the board as beans and meal attempt to find a bottom from fairly obvious tops at the moment.  And for the moment, soyoil futures seemed to have stopped falling and are beginning a consolidation process wrapped around the 31c level

The markets opened lower but corn prices held in which eventually turned bean and meal prices higher.  Consumers took advantage of the bean and meal break to get something priced.

SOY
July beans and meal started the day lower but found good commercial pricing activity which turned prices higher from lower.  Inverse's strengthened as more bullspreading activity took place for the day.  Jul /Dec meal traded up to 29.30 and July /Nov beans firmed to 30 1/4c as the flat price rally took place.  July crush values firmed up to 1.40c/bu, with August at 1.14c/bu.  In larger trades of note JP Morgan purchased 500 August 3.60 meal puts.  Once again the day became about higher meal against weaker soyoil values with oilshare dropping down to .2830% in July.

GRAINS
July corn futures opened lower but held ground and worked higher throughout the early morning trade technically trading over $4.00 on fund buying activity.  Corn progress will probably not gain much ground from this point as rains continue across the Midwest.  Indiana and Ohio remain the states most behind the pace where corn areas could be in jeopardy - those probably heading to bean fields.  Between wet forecasts and good export inspections yesterday the market remains mostly a firm trade.  Corn is particularly higher against wheat, with the July wheat/corn spread trading at 61 1/2.  The upward move in corn put a floor under soy as well as creating some support at wheat lows.  Sep/Dec corn spreads traded into a 2 1/2c carry.   Shortcovering for CME and Kansas City wheat was noted on a relatively small scale at trading range lows. 

Fund recap
bot 2000 wheat
bot 5000 corn
bot 6000 beans
bot 4000 meal
sold 2000 soyoil

CLOSING COMMENTS
As mentioned earlier, we opened lower on key support and started to again rally upward this time led by corn.  The funds typically will flow into a market and dominate for 2-3 months.  We are therefore in month 2 and therefore lower support points should be taken as an opportunity to get a short covered or try the market from the long side.  Today beans and meal opened at key support and held, and by no means wants to relinquish the strong market status.  Lesson is stay flexible and until the market shows continued weakness for days on time be mindful of dominant trends which for beans/ meal are higher and now corn perhaps wanting to join the fray.

Closing 23 May 2016

CBOT May 23
Lastchanges
SMN387.7-5
SMQ377.5-3.3
SMU371.5-2.2
SMV366.3-2.2
SMZ364.6-2
SMF7360.3-2.2
SMH7347.7-3
SN1058.5-15.75
SQ1057.75-15.75
SU1045.5-14.75
SX1036.25-13.25
SF71033.5-14
SH71016.25-11.25
BON31.15-0.12
BOQ31.26-0.12
BOU31.38-0.12
CN397.75+3.25
CU399.75+3
CZ402.75+3
WN462.00-5.75
WU473.00-5.75
WZ491.00-5.5

GOOD MORNING,
Beautiful weekend in St. Louis with warmer and drier weather.  Forecasts remain warm and farmers will be looking for opportunities to get the rest of the corn in the ground along with their beans.  Prices this morning are reflective of better planting opportunities, with a more relaxed theme as the temps across the Midwest goes from levels in the 50's up to 70/80's.   The advertised corn pace is expected to be around 80/85% for corn vs. a five year average at 86%.  Beans are expected to jump up to 55-62%.  

In terms of other reports, the USDA Cattle on Feed released on Friday indicated May 1 on-feed at 101% of last year above trade expectations of 99-100%.  Placements were 107% of last year versus expectations of 99%.  Marketings were light relative to trade ideas at 101% of year ago vs. 102 expected.

If we examine the overall bearish and bullish inputs we break it down this way: 
Bull side for corn:  becoming more competitive with less competition from the Black Sea.  The Brazilian corn crop is cut weekly as the drought is persistent with no relief in sight.  Funds are long and they probably plan to stick around into key pollination around July 4th before adjusting in a major way.   

Bear side: globally we still have loads of corn, and ending stocks in the U.S. that are still very ample.

Toss up:  where is the last 15% of corn going - corn or beans?  The market is likely going to acknowledge beans if progress over the next few weeks starts to get behind.

Bull side for beans:  weather turns better and last 15% goes to corn
Exports still good.  Crush still at seasonal new highs for the move upward.
Bear side:  carry-out still ample from 350-400, and even the 2016/17 at 305 mln bu not tight.

Bull side for wheat:  only place funds hold a considerable short position
Bear side:  global conditions good in the U.S., plenty of Black Sea stuff, growing US ending stocks.

SOY
Opening soymeal strength in the July contract was the feature at the start of the day.  July meal set a new contract high in the opening moments at 398.30 against a weaker soyoil trade.  July oilshare initially fell to .2823% on meal's strength which pushed July crush values up to new highs.  But after the initial open July meal futures found profit-taking at new contract highs which were close to $400.00.  Prices seesawed on either side of settlement for meal, triggering small sell stops as prices worked lower.  Weaker meal created more profit-taking in the bean market.  July soyoil futures found support at nighttime lows of 3079, pushing oilshare back to .2880% in July with crush values at 1.35/bu, still high for this time of the year.  July /Dec meal inverses relaxed from a 30.00 high to trade to a low of 22.20 by midday, not that much weakness considering the extent of the rally.  July /Nov beans traded down to 23c from highs closer to 39 1/2 on Friday.

GRAINS
Buy corn/sell wheat trade was the key feature of the day.  July corn broke to key support and found support technically and a bit fundamentally with export inspections coming in fairly good.  Spreads narrowed with July /Dec corn carries trading to 4c from a 5 3/4c high.  July wheat was largely ignored as traders are not willing to add to bearish positions in front of a holiday.  Buy July corn/sell wheat traded at 66c. 

The futures / options combined estimated positions in contracts look like this:
beans: net long 205,100
meal;  net long 88,700
soyoil:  net long 52,900
corn:  net long 53,970
wheat:  net short 83,575

CLOSING COMMENTS
On Monday's we often trade fund positions, which are very long beans and meal.  Thus the profit-taking evident today. 

The meal market's dynamic advance was met by a very erratic trade, making it feel as though a temporary top is in place.  The market is still going to attract support on setbacks in beans/meal from buyers who have to price or missed their chance via the last rally.  Since this is heading into a holiday weekend, the theme we saw today of light liquidation may stick around all week as we drive into trading ranges from the "tops".  Or in wheat, from the bottom.

CBOT closing 20 May 2016

CBOT May 20
Lastchanges
SMN392.7+14.6
SMQ380.8+9
SMU373.7+5.4
SMV368.5+4.5
SMZ366.6+4.2
SMF7362.5+4
SMH7350.7+3
SN1074.25+2.75
SQ1073.5+0.5
SU1060.25-1.75
SX1049.5-4
SF71047.5-3.75
SH71027.5-4.5
BON31.27-0.64
BOQ31.38-0.65
BOU31.50-0.65
CN394.50+4.5
CU396.75+4.25
CZ399.75+2.5
WN467.75-1
WU478.75-0.75
WZ496.50-1

Rain again in the St. Louis area with cool temperatures.  This has been the trend for the season so far.  On Monday we will see how far we got as far as planting progress is concerned.  Temperatures are due to warm up but rains are due to keep coming. 

Overnight features included another new contract high in the meal market.  July meal jumped to $388.90 taking beans back up for the ride and solidifying this week's break as bottom lower support.  Soyoil futures are in the red as oilshare now posts new lows in the July contract at 29%.  This move has solidified itself in the trading space as one of the most dynamic trades, falling from overall highs of 39% a lot quicker than the process of rallying up there.  Crush values are higher in step with much higher meal values. 

ON the grain sector side, the market action is more ho-hum as corn and wheat chop around in wide ranges.  Pressure for corn is coming from this week's rally that took the July futures contract just slightly beyond $4.00, while it feels like wheat is trying not to post new contract lows.  Buy bean/sell corn trade continues.  Yesterday July corn traded below trendline support but today we are back over it meaning that all eyes will be on if we can extend the bean rally further this morning. We certainly closed meal on the highs of the morning suggesting that there is more rally left still when the market opens.  And that could apply to corn as well.

The Dow is going to open higher along with gold futures.  Crude has been on both sides of even today inching ever-so-closer to $50/barrel with a trading range high so far of $48.79/barrel.
Futures opened as called with the major feature of the morning a new high in the July meal market at $391.70.  But on Friday's new highs can also be met with a round of profit-taking, which was the case today.  But by midday meal was on the move to the upside once again with bull spreading activity for beans and meal.  Most of the volume was in the soy complex today, while grains (particularly wheat) was ignored.

SOY
The soy complex traded both sides of unchanged.  July meal hit a new contract high at $391.70 before heading into a profit-taking round of trade.  But after the 12:30 hour meal was back at it placing a new high once again.   Bean prices tried to rally above key resistance in the July contract at 10.87 1/2 but failure against this level and weaker soyoil values ignited a profit-taking sell-off.  Bean and meal inverses that were stronger at the open seemed to stall as flat-price trade took a morning break from the higher values across the board.  Once again the trends present before the open continued with July oilshare falling below 29% to .2891%.   July crush traded up to 1.26c/bu. an all-time seasonal high.  Dec crush trading at 1.16c/bu also set a seasonal all-time high.

GRAINS
Wheat and corn prices were mixed, corn higher and wheat prices falling.  Funds continue hold short positions in wheat and found no incentive to buy the market as technically it did not proceed over key resistance levels.  July corn prices held bottom support well, and then followed bean prices upward.  Corn spreads narrowed with July / Dec trading to a 5 1/4c carry.   

fund recap
sold 2000 wheat
bot 5000 corn
sold 5000 beans
bot 4000 meal
sold 3000 soyoil

CLOSING COMMENTS
Planting progress is going to be full steam ahead this weekend.  Farmers who can plant will.  Others will be watching weather forecasts.  If there is one thing we know it's that farmers can get into the fields quickly and make up for lost time.  The corn market today is keeping some premium in for planting glitches.  The bean and meal markets continue to display resiliency on breaks, indicative of bull market behavior, or "fade at your own risk".  If needing to buy in bull markets, take advantage of breaks of size. 

After all is said and done the futures / options position combined in contracts looks like this:
beans:  net long 178,700
meal:    net long 80,1000
soyoil:  net long 48,300
corn:      net long 69,900
wheat:   net short 74,500

We will trade these positions on Monday.

CBOT closing 19 May 2016

CBOT May 19
Lastchanges
SMN378.1+5.4
SMQ371.8+3.2
SMU368.3+2.6
SMV364+2
SMZ362.4+1.4
SMF7358.5+1.2
SMH7347.7+1.1
SN1071.5-3.75
SQ1073-4
SU1062-4
SX1053.5-4
SF71051.25-5.25
SH71032-4.75
BON31.91-0.54
BOQ32.03-0.53
BOU32.15-0.53
CN390.00-9.5
CU392.50-9.75
CZ397.25-8.75
WN468.75-11.25
WU479.50-10.5
WZ497.50-8.5

GOOD MORNING,
Prices are lower across the board this morning.  Beans and meal prices are working lower but the pronounced weakness is being led by soyoil futures, off by over 50 pts to begin the day.  Soyoil prices are now under all support and moving averages, while meal futures are just a stone's throw away from contract highs.  July oilshare traded down to new lows of .30%.  In the meantime, grains continue to move with corn hanging close to the top of recent values while wheat markets chop sideways. 

Since it's Thursday we do get export sales for a new fundamental input.  Soyoil sales and beans were good, but today the market has a "get -me - out " feel, working to the lower end of trading ranges except for meal.  Wheat futures are in the lead to the downside with poor export sales in general for grains.

Calls are lower across the board and get the sense that this may be a more difficult day to recoup losses as weather is going to turn warmer and drier from here - bumping up planting progress next week

-Strategie Grains cut its forecast for the European Union's year-end stocks for wheat even as corn stocks continue to swell.  The increased demand for EU wheat was at corn's expense as farmers chose the cheaper grain for animal feed.
-The Dow is opening lower with another plane missing in what could be a terrorist act.  
-In USA, the number of people seeking jobless aid fell last week by 16,000 to 278,000.

The markets opened lower as called but once again meal prices traded into new contract highs on the board as soyoil futures traded down to new lows.  Grains were weaker with warmer and drier forecasts creating a round of profit-taking on bullish corn bets.

SOY
The major feature in the soy complex was higher meal.  The July contract jumped to new contract highs at 378.50 as more uncovered consumers have to get something on the books.  The chart formation continues to look the friendliest for this market, continuing to trade in an uptrend channel and posting new contract highs on good volume.  Funds purchased meal against soyoil, which pressured July oilshare below 30% to .2964%.  July crush values jumped to 1.11c/bu as meal prices traded upward.   More bullspreading was noted with July /Dec meal inverses strengthening to 16.20 and July /Nov beans trading stronger again to a 21 1/4c high from opening values that were closer to 15c  July beans briefly broke key support at 10.62 triggering small sell-stops, but today's decent recovery negates the impact of that break.

Corn and wheat values were lower today as conditions appear to warm and dry out for the balance of the week.  Trade turned extremely technical as farmers took advantage of the $4.00 level in July corn to get something on the books.  As support points were breeched the funds began to throw out more of the recent length with not as much pricing activity.  CBOT wheat values dropped lower versus lesser losses in KC contracts.  Spreads weakened with the July /Dec corn carry widening back out to 7 1/4c from 5 1/2c lows.

FUND RECAP
sold 6000 wheat  (from 5000 earlier)
sold 17,000 corn  (from 13,000 earlier)
sold 6000 beans  (from 4000 earlier)
bot 2000  meal (from bot 1000 earlier)
sold 8000 soyoil  (from sold 6000 earlier)

OUTSIDE MARKETS
The Dow opened 48 pts loewr and stayed in the red for most of the day, off 89 pts by midday.  The strengthening US dollar was one of the major catalysts for lower Ag trade today.  The chance that we could see an interest rate increase (which would strengthen the US dollar further) played into more downside as much as improving weather forecasts.

CLOSING COMMENTS
Meal prices seem to live in a world of their own, as they jump to daily new highs.  Expect that the good close today may see follow-through in meal in tonight's session.  Oilshare continues sloppy and traders continue to chase meal while selling soyoil on weaker palm prices.  Soyoil charts point to true definition of a top in place.  Bean charts continue to bend but do not break. Continue to own corrective pullbacks in beans and if corn gets into the ground more buy bean/sell corn price action.

CBOT closing 18 May 201y

CBOT May 18
Lastchanges
SMN372.7+3.6
SMQ368.6+2.1
SMU365.7+0.9
SMV362-0.4
SMZ361-1.2
SMF7357.3-2.1
SMH7346.6-1.5
SN1075.25-5
SQ1077-5.5
SU1066-7.75
SX1057.5-9.75
SF71056.5-8
SH71036.75-6.75
BON32.45-0.33
BOQ32.56-0.33
BOU32.68-0.33
CN399.50+2.5
CU402.25+2.5
CZ406.00+2.25
WN480.00-1.75
WU490.00-1.25
WZ506.00+0

Prices are lower this morning with most commodities and equities in the red - in other words looks a little like a macro day of across- the -board selling activity.  The Dow is slightly lower as one begins to ponder if we are at the start "sell in May and walk away" trading activity.

Though July meal will begin lower, it did manage to post a new high for the move upward at $372.70.  Bullish meal trade pulled beans along for the ride.  Unlike its neighbor, July beans met trendline resistance during the night session at $10.88 and will open lower.  Last night's price action, unlike other sessions, did feel a bit more "toppy" in nature, despite meal's ability to place a new high.  Soyoil futures and wheat continue to be the weakest charts in terms of price activity.  Weaker soyoil charts this morning drove July oilshare below 31% to .3053%.  But as July soyoil nears 32c we could begin to see traders flip-flop taking advantage of lower soyoil prices to get something booked.

Crude oil traded up to new highs at $48.03/ barrel while the US dollar is a touch firmer,  As stated before the Dow is called lower but hopefully calmer heads will prevail and we can spin a more positive tone to this market Fed comments depending.
The markets opened lower on the day but meal prices rebounded taking out the highs in the night session.  July soyoil prices recovered after testing lows close to 32c.  Corn prices also responded trading on both sides of unchanged.

SOY
The soy complex started lower but meal quickly found support at lower levels of trade to post new contract highs.  July oilshare dropped to new lows as soyoil values struggled to find support around the 32c level.  But good commercial pricing activity in July at 32c kept values well supported during the AM session.  July oilshare pushed down to lows of .3041% as meal pushed to new contract highs.  Meal's rally strengthened July crush which put in active trade with levels climbing upward to 1.00c/bu.  Canola prices started the day lower and even though good rains are forecast for areas that need them prices were also following the path of others from lower values to higher on the day.  Later in the session bean and meal inverses strengthened with July /Nov bouncing from lows of 10 1/2 up to 19 1/4c inverse and July /Dec meal up $4.60 to trade back to $12.60 from opening lows of $6.60.

GRAINS
Corn and wheat started the day lower but higher meal and more shortcovering in wheat took prices above unchanged - higher for the day.  Fund buying in both emerged as prices cleared yesterday's higher levels for Jul corn at $3.98.  Warmer and drier weather forecasts were keeping farmers in the fields and away from the board as prices for corn and wheat rallied to levels previously noted.  That allowed July corn to confirm a higher rally without much problem once the $3.98 level was taken out to trade slightly over $4.00 towards previous highs at 4.07 1/4c. 

fund recap
bot 6000 beans
sold 3000 soyoil

CBOT Closing 17 May 2016

CBOT May 17
Lastchanges
SMN369.1+7.9
SMQ366.5+7.8
SMU364.8+7.6
SMV362.4+7.1
SMZ362.2+6.5
SMF7359.4+5.8
SMH7348.1+4.8
SN1080.25+15.75
SQ1082.5+15.75
SU1073.75+14.25
SX1067.25+12.25
SF71064.5+10.75
SH71043.5+9.25
BON32.78-0.01
BOQ32.89-0.01
BOU33.01-0.01
CN397.00+3
CU399.75+3.75
CZ403.75+3.75
WN481.75+7
WU491.25+7.25
WZ506.00+7

The markets seem to be focused right now on two things - making sure the corn crop goes in under timely circumstances, and how much of the bean and corn crops are going out the door for exports.  NOPA crush reported as expected but it is the second largest crush for the month of April, with processors now owning ample stocks courtesy of our recent rallies.   

This morning prices are bouncing back after consolidating over the last few days.  Jul meal prices are within a stone's throw of recent contract highs at 367.70.  If July beans trade back over $10.75 will send us directionally higher as well, suggesting we could make another run at recent tops. The corn price action remains the weakest when it approaches its key major resistance, and for the July contract that price is $3.95, the place where most current rallies have failed.

The Dow is going to begin weaker this morning, though crude oil penciled in new highs at $48.42/gallon today.  When will the public begin to view crude oil as expensive again?  Probably when gasoline prices cross $3.00/gallon.

This week's weather is wet and cool, but the farmers made some progress given the drier weather a week ago.  Corn planting progress was 75% complete, at the highest end of trade idea.  The eastern cornbelt remains challenged while the west and the north were full speed ahead.  Spring wheat conditions are progressing with 89% complete, while the southern plains continues to receive good rainfall keeping the HRW crop in good shape.  Bean plantings remain in line with recent averages at 36% complete, ahead of the five year average at 32%.

The soy complex opened higher and quickly rallied upward led by surging meal values that printed new contract highs for the move.  Grains followed at a slower pace.  There are no new announcements, stories or rumors other than chartists continuing to respond to technical considerations in terms of the higher price action.
   
SOY
The soy complex opened higher and the chart that had the most suggestive upside potential (meal) did indeed rally and post a new high for the move upward.  July oilshare collapsed further as meal rallied against soyoil price action, breaking the 31% level to trade to .3080%.  July crush strengthened further to 92c/bu.  Bullspreading activity for beans took the July /Nov inverse back up to a 13 1/4c high bouncing off a 9c low for the move downward from overall highs of 28c.  Oil spreads widened trading out to 58 pts for July /Dec soyoil spreads while the July /Dec meal spread inverted to stronger values at $7.50.  All in all the price action again was firm illustrating why funds continue to own more bean and meal length.

GRAINS
Stronger soy complex price action created more short-covering in wheat, where the July contract traded past $4.80 triggering small buy-stops in the process.  Wheat gained against corn with the July wheat/corn spread trading up to 87 3/4c from lows at 80 1/4c.  CBOT wheat values were stronger than KC.    July corn setbacks were viewed as buying opportunities, while trade past key resistance of 3.95 set off more technical buying signals.

Fund recap
bot 3000 wheat
bot 4000 corn
bot 7000 beans
bot 3000 meal
bot 1000 soyoil

CLOSING COMMENTS
The markets have been firm all day as funds come back to buy more.  Today does not feel like a "fall apart" day, as farmers sell into fund ownership.  Those waiting for setbacks are now coming in to price something.  If wanting to be short have to still pick the market that appears ready to always slide lower first to new lows which includes wheat and soyoil.  For the others, think we hold onto our strong tone into day's end.

CBOT closing 16 May 2016

CBOT May 16
Lastchanges
SMN361.2-1.8
SMQ358.7-2.3
SMU357.2-2.5
SMV355.3-2.7
SMZ355.7-2.7
SMF7353.6-1.9
SMH7343.3-0.4
SN1064.5-0.5
SQ1066.75-0.25
SU1059.5+0
SX1055+0.5
SF71053.75+2
SH71034.25+4.25
BON32.79+0.29
BOQ32.90+0.29
BOU33.02+0.3
CN394.00+3.25
CU396.00+2.75
CZ400.00+1.75
WN474.75+0
WU484.00+0
WZ499.00-0.25

On Monday's we often tend to trade "positions" from the commitment-of-trader's report last Friday.  Today was no exception with the futures /options positions for beans (on the long side) nearing the 200,000 mark, and funds adding to meal length.  The markets opened lower and more profit-taking from the bull traders in beans and meal set the tone for the day.  Higher crude oil and palm values supported soyoil.

At 10:00 export inspections were released as follows:
corn:  1,110,600 tons vs. 1,148,155 tons wk ago
wheat:  367,881 tons vs. 500,309 tons wk ago
beans:  194,637 tons vs. 146,040 tons  wk ago

- Rallies today were taken as an opportunity to get rid of some length in the bean and meal market though bean /corn inspections were neutral and wheat low end. 

- Informa was released with US soybean acreage forecast at 83 mil acres in 2016 and corn acreage at 93.4 mil.  This compared to USDA at 82.2 mil for beans and 93.6 mil for corn. 

SOY
Soybeans and meal traded lower on the day as worse weather for corn planting this week which could spell more potential bean acres in the future.  Soyoil prices were higher by 25 pts lifting oil-share back towards  3130-315%.  At 11:00 the April NOPA crush values were released which were just about what the market anticipated at 147.6 mil bu, but year on year it is the second highest April on record.  Soyoil stockpiles grew to a larger-than-expected 1.94 bil pounds, over the upper end of trade estimates.

GRAINS
Buy corn /sell bean trade was the noted feature of the morning.  Farmers are now getting concerned about getting the last portion of their corn crops in the ground given wet and cool forecasts.  But the trade is also responding to technical price action, where July corn traded upwards towards previous trading range resistance in the July contract at $3.95.  Funds are not long as much corn as beans, and are a net wheat short.    The July /Dec corn spreads narrowed into 6 3/4c carry from 8c carry, while July /Dec wheat traded to 24c.  July wheat/corn traded to 79c with wheat values down 4 as compared to a steady corn market. July corn now has the lion's share of the total open interest standing at 612,958 contracts followed by December at 320,414 contracts.  
- Crude oil is trading to new highs with an endorsement from Goldman Sachs that the major direction from this point forward will be higher.  Macros are positive.  Feels like weaker markets may turn and trade higher after the open with more large positions on the longer rather than shorter side of the market.

- USDA reported the sale of 128,000 tons of corn sold to South Korea in 2015/16.
                                                                                                                                                                       
- The Dow opened slightly weaker but quickly traded higher on the day, up 159 pts by the midday crude oil rallies to new trading range highs at $47.85/barrel.

Weather for the Midwest is cool and wet with temperatures beginning to warm into the end of the week.  There was actually snowfall in Minnesota, though it has to now be the last for the year.  The advertised number for corn planting progress this afternoon is around 70/75% vs. a 70% average.  Planting progress for beans is expected to be around 33/37% complete vs. a 31% average.  As far as Brazil's corn crop worries continue to mount over the size of the safrinha area with conditions continuing dry.  

In terms of overall positions, it appears as though funds reduced their net long positions in corn prior to the May WASDE while maintaining a short position in wheat.  The USDA supported the validity of being short wheat, and futures in this market remain stubbornly close to the overall low end of the range. 

Fund recap
sold 2000 wheat
sold 4000 beans
bot 2000 soyoil
sold 5000 meal

CBOT closing 13 May 2016

CBOT May 13
Lastchanges
SMK361-5.8
SMN363-1.4
SMQ361-1.6
SMU359.7-2
SMV358-2
SMZ358.4-1.9
SMF7355.5-1.2
SK1055-9.5
SN1065-7
SQ1067-7
SU1059.5-7
SX1054.5-6.75
SF71051.75-6.5
BOK32.17-0.13
BON32.50-0.07
BOQ32.17-0.13
CK382.00-3.25
CN390.75+1.75
WK465.00+6.5
WN474.75+6.75

Soybean trade lower with volatile trade continuing with momentum turning lower from the report day with trade trying to consolidate. Meal is lower and oil is flat. Crush margins have seen pressure from a big slide in oil prices after big export sales announced earlier in the week. The USDA announced 420k mt of soybeans sold to unknown split between old and new crop. Resistance on July beans is at the $10.91 high post report, then $11. Support is at the $10.48 10-day then the $10.30 20-day, giving trade a pretty wide range between support and resistance.

Corn trade is higher with trade finding some light buying during the day session. US weather looks cooler and wetter in the near term which should be mildly supportive with slower planting and growth into the middle of next week. Brazil remains fairly dry in the near term, which should support export business from the US. Basis has been fairly stable to firmer this week. Ethanol margins remain fairly stable today with ethanol and unleaded hanging together in the upper end of the range, a little weaker overnight.
   Wheat trade higher across the three contracts with some profit taking vs recent shorts. The dollar is sharply higher this morning, which should limit buying enthusiasm. World weather for wheat remains mostly non-threatening for the moment with growing optimism in about conditions in Russia.

Weekly review:  The week has been more than the same old, as beans and meal busted through highs once again, this week the crop report was if not the catalyst, the day of a vicious rally.  Oil share sets further, and hard to believe that it has made a contract low, as is down 2% for the week.  Post report has turned the bid into corn and wheat as well, and as beans and meal hold gains, there seems to be a bit of price recovering in corn vs the beans that it could be argued more to come.  But that of course is likely up to the meal market, as futures continue to soar, against a staid US meal basis, that, while implies delivery's, it has not happened.  Seems the hysteria over ending stocks, for the most part 2015-2016, that the market digested on report day, the old crop draw down of 40 mil bushels must prove that this will get done, in the midst of lowest exports to date in over 10 years.  Maybe that is what July-Nov speaks of this week, as is down 3 cents for the week while July beans are up 30.  Meanwhile May goes off the board today with May-July beans at 80% of full carry, May-July oil pays 3.5%, and of course May-July meal trades inverse, as the only commodity that has not seen deliveries against the May this month.  Carries abound in all, accept meal, as prices imply.....shortage, but of what?

CBOT closing 12 May 2016

CBOT May 12
Lastchanges
SMK366.8+2.4
SMN364.4+2.4
SMQ362.6+2.1
SMU361.7+2.4
SMV360+2.5
SMZ360.3+2.6
SMF7356.7+2.6
SK1064.5-5.25
SN1072-6.25
SQ1074-6.25
SU1066.5-5.25
SX1061.25-4.75
SF71058.25-5
BOK32.30-0.78
BON32.57-0.79
BOQ32.68-0.77
CK385.25+11.25
CN389.00+11.5
WK458.50+9
WN468.00+9

Soybean trade lower with trade shedding early gains with a sharp break in soyoil prices leading trade lower. Meal and oil are lower. The Chinese market has seen a substantial rally in meal values, helping to pressure oil. The weekly export sales were softer at 212,400 metric tons of old-crop soybeans, 6,900 of new, 115,300 of meal, and 16,700 of oil. Resistance on July beans is at the $10.91 high post report, then $11. Support is at the $10.46 10-day then the $10.25 20-day, giving trade a pretty wide range between support and resistance.

Corn trade higher with trade hanging together despite the reversal in the soybean trade. US weather looks cooler and wetter in the near term which should be mildly supportive with slower planting and growth. Brazil remains fairly dry in the near term. Basis has been fairly stable this week and should hold together pretty well. Ethanol margins remain
fairly stable today with ethanol and unleaded hanging together in the upper end of the range.  Weekly export sales were solid at 1.14 mil mt of old crop, and 150.4k of new crop. The USDA also announced 210k mt of corn sold to Saudi Arabia. On the July chart we are just below the $3.83 20-day, the 200-day at $3.85 1/2 is the highest major moving average. Support is now at the $3.74 100-day.

Wheat trade higher across the three contracts with trade following the lead of corn. The dollar failed to hold the rally this morning, adding a bit of support. World weather for wheat remains mostly non-threatening for the moment. The weekly export sales were mixed at 294,400 metric tons of old crop, and 387,900 of new crop. The July Kansas City chart has resistance at the $4.59 10-day with support limited due to our downside
momentum that has only been stopped by spillover support from the row crops this week

CBOT closing 11 May 2016

CBOT May 11
Lastchanges
SMK364.4+4
SMN362+2.3
SMQ360.5+2.2
SMU359.3+1.9
SMV357.5+2.2
SMZ357.7+2.1
SMF7354.1+1.4
SK1069.75-6.25
SN1078.25-5.75
SQ1080.25-5.25
SU1071.75-3.25
SX1066-1.5
SF71063.25-1.25
BOK33.08-0.05
BON33.36-0.08
BOQ33.45-0.1
CK374.00-4.5
CN377.50-3.5
WK449.50-2
WN459.00-2.25

The May report was fuel for the soybean market that locked limit up and posted new highs in the July contract at $10.91 1/2 with July meal at a new high of $367.40 .  The catalyst was smaller South American crops and a 2016/17 ending stocks number at 305 mil bu.  In reality, 305 mil bu does not imply there are shortages, but it does sound a lot smaller when compared against previous 405/450 mil bu ending stocks.  So the funds embraced the new reality and bought a boatload of beans, sending prices sharply higher.  Farmers responded in kind, selling a fresh amount of product at these new and surprising highs. 

In the meantime, the corn and wheat markets stayed in their lane with numbers more in line with estimates.  However the USDA was surprisingly aggressive acknowledging better corn exports (like good bean exports), which kept prices well supported.   But the price action in corn and certainly wheat by no means is matching bean price action which appears to now be in its own world.  Wheat is the brick in terms of price action, barely moving off its lows which could indicate a downhill slide when the soy complex weakens. 

In the meantime we are still dealing with a Brazil Safrinha corn that is edging lower by all private estimations.  Wheat is the brick of the Ag space, sitting at its lows and refusing to budge higher.  As to South American numbers; the USDA was rather modest about lowering the size of the crop altogether with Brazilian bean production at 99mil mt while most private analysts are sitting at 96mil mt.  Even Brazil's 81mil mt corn number seemed too high.  So there possibly could be more damage to be factored into this market price.

The market opened cautiously with profit-taking after yesterday's bean and meal run-up in terms of price action.  Wheat prices weakened along with corn. 

SOY
Soybean and meal prices worked backwards into yesterday's rally but the setback was fairly shallow considering the size of the run-up.  Meal spreads tightened with July/Dec inverse trading to $4.00.  The July /Nov bean inverse traded up to 19c but values faded back to a 12 1/2c inverse.   As meal and bean prices retraced its rally, soyoil futures remained more stable with crude oil's rally up to $46.13 /barrel and more business announcements for soyoil going to China and unknown.  July and November bean volatility rose to 29% and 25%, respectively with the rally

GRAINS
Wheat prices opened on a firm note but soon turned lower on the day down towards overall contract lows. The May WASDE was most bearish for wheat, with world reserves forecast to climb to a record 257mil mt by the end of 2016/17.  Kansas City losses were in the lead down 6 with CBOT prices trending down 3.  Corn was also seeing a fair amount of weakness with the July contract turned away from key resistance at $3.86 as it worked back again towards its 100 day moving average at $3.73.  Farmers continue to plant corn and it's always tough to keep corn prices up when planting begins.  The July /Dec wheat spread traded into 27 3/4 carry while corn spreads were wider with July /Dec trading out to 7 1/4c.