Afternoon Market Highlights


Highlights

The Ag markets had a busy week this week with a lot of uncertainty in the mix.  Slowed plantings, trade deals close to seeing a resolution and then more trade rifts showing up.The focus is on the weather for the weekend and next Monday’s planting progress numbers. The funds have rolled from big record short position in corn, a couple of weeks ago to a long position as of this morning. 

  • CHS Hedging is offering Energy Hedging classes June 19, Grain Hedging classes June 25 and Technical Trading classes on June 26.Go to our website at www.chshedging.com for registration and class details.
  • Year-round-use of E15 ethanol blend was approved by President Trump this morning. S owe could expected to see stations get themselves set up to sell the higher blend this summer.
  • Energy markets are sharply weaker with crude oil down over three bucks at $53.17/barrel.
  • The US$ rolled over, trading 407 lower at $97.73. The gold market is sharply higher, up 17 bucks at $1307 (last time it was over 1300 was May 15 at 1301).
  • Wall Street was weaker with the DJIA down 342 at 24827, S&P down 35 at 2755 and the NASDAQ down 118 at 7449. 

Corn

Corn prices were lower on profit taking and talk of implementing tariffs on Mexican goods. The corn market rallied hard this week on delayed plantings and unfavorable weather conditions for much of the US Upper Midwest. Hearing farmers will look for short day corn to plant with the rally in the corn market, despite prevent plant date deadlines.  

  • Closes: July $4.27, down 9 ¼ cents, September $4.36, down 9 ¼ cents and December $4.43 ¾, down 8 ½ cents.
  • Weekly export sales were reported at 983 tmt, above trade estimates.YTD top weekly buyer of US corn is Mexico. They were the 2nd biggest buyer of US corn last week.
  • Crop progress was at 58% complete with little progress done this week.The average estimate for Monday’s crop progress report is at 68% complete with the 5-year average at 96% complete at this time.
  • Spreads: N/U 8 ¾ carry, U/Z 7 ¾ carry, Z/H 7 ¾ carry, Z/N 10 carry, N20/Z20 37 ¾ inverse.  

Oilseeds

Soybean prices turned lower on a bout of profit taking after four sessions of sharply higher prices. Losses were limited from slow planting progress with only 29% of the crop in as of last Sunday.  Fears of a trade battle with Mexico pressured the soy complex today. They are a decent buyer of US soybeans, especially without China’s bean business. 

  • Closes: July at $8.77 ¾, down 11 ¼ cents, August at $8.84 ½, down 11 cents and November at $9.04 ¾, down 10 ¾ cents. The products were weaker with meal down 6-7 bucks and soyoil down 19 points.
  • Weekly export sales were reported at 478 tmt, in line with trade estimates. YTD Mexico is the second largest buyer of US soybeans.
  • CHS planted soybeans in the garden boxes outside the Inver Grove office cafeteria and they are up.
  • Planting progress is expected to be near 40% complete versus the 5-year average at 77% complete.
  • Spreads: N/Q 6 ¾ carry, Q/X 20 ¼ carry, X/F 11 carry, X/N 32 carry.

 

Wheat

Wheat prices turned lower on weakness in the row crops and fears of another trade battle (this time between the Us and Mexico).  Mexico has been a big buyer of US HRW and it would not be good for the US if something were to jeopardize that. 

  • July closes: Mpls July at $5.52, down 11 ½ cents, KC at $4.73 ¼, down 5 ¾ cents and Chicago at $5.03, down 11 ½ cents.
  • Weekly export sales were at 565 tmt, near the top end of trade estimates.
  • Winter wheat crop conditions were at 61% G/E last week and would expect to see another 1-2% decline on Monday’s USDA crop progress/conditions report.
  • The winter wheat was 66% headed out versus 54% the week prior and 76% on average.
  • The spring wheat was at 84% complete last week and should be near 100% by Sunday.
  • There are rumblings about dryness in western ND and the western prairies of Canada.
  • Spreads: Mpls N/U 8 ½ carry, U/Z 11 ¼ carry, Kansas City N/U 11 ½ carry, U/Z 20 carry, N9/N0 60 carry (watch the VSR on this one, the bigger play might be the U9/U0).