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.
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