July Corn finished up 7 1/4 at 371 1/2, 1/2 off the high and 5 1/4 up from the low. December Corn closed up 8 at 390 3/4. This was 6 1/4 up from the low and equal to the high.
July corn posted strong gains today, and it outpaced gains in soybeans and in wheat on a relative basis in the process. This took the July contract near the highs for the week and a step closer to the 100-day moving average which sits near 380 in the July contract today. Traders said that talk of a possible new round of corn import quotas from China helped to support the market along with higher equity markets and sharply higher crude oil. The USDA will issue its latest Export Sales report tomorrow. The average needed each week to reach the USDA’s current export projection is just 374,300 tonnes as compared with a 5-week average of 1.34 million tonnes. The weather outlook remains variable and largely favorable across the Corn Belt through the end of next week. Somewhat cooler temperatures into the weekend and next week are still in most forecasts for the Midwest although temperatures may be hotter in the western and southern Corn Belt than previously forecast. One of the major upcoming forecast features is a system of heavy rains next Thursday and Friday that could cover nearly all major growing areas of the Midwest. This would be considered very beneficial to the developing corn crop after a relatively warm and somewhat drier spell. The corn crop should be near 100% planted by that time. Scattered thunderstorms boosted soil moisture in a few localized areas of Illinois, Iowa and Wisconsin Tuesday.
July Wheat finished up 1 1/4 at 461 3/4, 10 1/4 off the high and 2 3/4 up from the low. December Wheat closed up 1 1/4 at 510. This was 2 3/4 up from the low and 9 1/2 off the high.
While many commodity markets moved higher today, wheat struggled after staging a substantial rally overnight and into the start of the day session. Traders said that this was due in large part to a rally in the dollar during the day session along with ample world supplies of wheat. Oversupply is a particular problem in India where government storage is bursting with about 8 times the wheat that the country is mandated to keep in reserve. Wheat lost ground to corn on the day and Chicago lost ground to KC. The USDA will issue its latest weekly Export Sales report tomorrow. Sales need to average 376,700 tonnes each week to reach the USDA’s current export projection for 2009/10. Weather forecasts call for a push of very hot air from the Southwestern United States into the southern Plains and perhaps much of the central Plains by next week. This could cause stress to some of the developing hard red winter wheat crop, although this system might be positive to late crop development if it does not push too far past the 90 degree mark for an extended period of time.
July Soybeans finished up 7 1/2 at 938, 2 off the high and 5 up from the low. November Soybeans closed up 7 at 910. This was 5 up from the low and 2 1/2 off the high.
The July soybean contract rallied on the day, but it failed to take out yesterday’s highs despite finishing near the highs of the day. Oil posted a substantial gain on meal in both old and new crop contracts, but July/November spread traded near unchanged on the day with traders indicating that the favorable weather outlook through next week may already be priced into the market. Traders said that today’s support came from higher equities and a general rise in commodity markets, although a rally in the dollar during the day dampened buyers’ enthusiasm. Forecasts call for near normal temperatures into next week with the possibility of heavy rains across most of the Midwest on June 3rd and 4th. Basis levels for soybeans were firm in Illinois this morning on light farmer selling. The USDA will issue its latest Export Sales report tomorrow morning and old crop sales need to average just 93,400 tonnes each week to reach the USDA’s current export projection for 2009/10.
July Soybean Oil finished up 0.68 at 37.85, 0.03 off the high and 0.79 up from the low.
July Soymeal closed up 0.2 at 271.3. This was 0.8 up from the low and 3.0 off the high.
July Rice finished up 0.095 at 11.715, 0.105 off the high and 0.025 up from the low.
July Oats closed up 1 at 192 1/2. This was 1/4 up from the low and 4 1/4 off the high.
This blog is published by Andy Waldock. Andy Waldock is a asset manager, trader, analyst and broker. As a result, Andy Waldock may have positions for himself, his relatives, or his customers in any market discussed. The blog is meant to develop a dialogue and educate those with an interest in the commodity markets. The commodity markets employ a high degree of leverage and may not be advisable for all investors. There is considerable risk in investing in futures.
The daily commentaries provide a review of any reports released that day, a recap of each commodity’s traded price activity, an analysis of the factors that influenced price activity, and a look ahead at the next day’s schedule. Market commentaries for corn, wheat, soybeans, gold and silver are provided by CME Group.
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