Morning Highlights


“if market volatility persists it may also impact July options expiration and futures delivery cycles… please be diligent in managing these risks over the next couple weeks.”

 

Highlights

  • The USDA’s updated acreage and June 1 grain stocks report is scheduled for June 28th at 11 AM CDT. Next week is the end of the month of June and the end of another quarter.
  • July options expiration is at the close this Friday. FND for July futures is Friday June 28th.
  • President Trump is upbeat about trade talks with China and is hopeful that there could be positive results at the scheduled meeting later this month.
  • Chinese tariffs on US DDG’s are expected to continue. The tariffs were first implemented back in 2016.
  • Energy markets are mixed with crude oil up a freckle at $53.94/barrel.
  • The US$ is down 107 at 97.53, gold down 4-5 bucks at $1,345/ounce and the CD$ is slightly higher at 0.74795.
  • The DJIA is up 353 at 36465 and the S&P is up slightly at 2922. 

Corn

  • Prices continued in a consolidation type trade as the corn market appears to be viewed as overbought.
  • July at $4.45, down 4 ½ cents, September at $4.50 ¾, down 4 ¾ cents, December at $4.57 ¼, down 5 ¾ cents. July and Dec are 10 and 8 cents above their respective 10-Day moving averages.
  • The higher US prices were making a play for South American corn coming into the US east coast ports more possible.
  • Ukraine’s corn crop suffers from extensive hot/dry weather conditions. The latest USDA production estimates was at 33.0 mmt for 2019/20. This compares to 35.81 mmt for 2018/19.
  • Spreads: N/U 5 ¼ carry, U/Z 6 ¾ carry, Z/H 4 ¾ carry, Z/N 6 ¼ carry, N0/Z0 46 inverse.  

Outlook: lower trade on lack of fresh supportive news and followthrough selling 

Oilseeds

  • The soybean market traded lower on followthrough weakness from yesterday.
  • The July is down 5 cents at $9.08 ½, looks to be testing the $9 support level. The low so far has been $9.06 with an unfilled gap from the 17th ($9.00 ¾-$8.98 ¼).
  • The November is 5 cents weaker at $9.35, with a low of $9.33 and an unfilled gap from $9.27 ½-$9.24 ¾ from the 17th.
  • September palm oil closed up 24 at $2,04 ringgit on rumors of improving exports for June.
  • The Chinese soy complex was weaker with beans down 5 ¼ cents, meal down over 8 bucks and oil down 43 points.
  • Spreads: N/Q 6 ¾ carry, Q/X 19 ¾ carry, X/F 12 ¼ carry, X9/N0 22 ¾ carry. 

Outlook: Lower trade on followthrough from yesterday 

Wheat

  • The wheat market traded lower on fund selling and lack of fresh supportive news. Weakness in the corn market provided additional pressure.
  • The Mpls July is trading just below its 50-Day Ma of $5.47 ½. The KC July is trading 4 cents above its 100-Day MA over $4.51.
  • South Korea MFG purchased 120k tonnes of optional origin feed wheat for LH Aug/FH Sep shipment at $214.95/tonne C&F.
  • Russia appears to be the lowest offer to Egypt’s tender at $196.86/tonne.
  • Spreads: Mpls N/U 6 ¾ carry, U/Z 12 ¼ carry, Kansas City N/U 11 ½ carry. Mpls July is at an 87 cent premium over KC. 

Outlook: lower trad on weakness in the row crops, technical selling and poor demand