MARKET UPDATE

Futures Prices Close

Overview

Wheat rallied to new highs, up +20 cents at one point. Touching that target of $7.16 we had last week. However we failed to hold the gains, closing -26 cents off the highs at $6.93. The losses were mainly seen as profit taking, as the big money has been the main driver of this rally.

Corn and soybeans however remained strong, as soybeans nearly made a new high. Closing at $12.46. We haven’t closed above $12.50 since mid-January. A break above could open the door to higher prices.

Planting progress came in faster than expected Monday. Corn was 70% planted. Yet we are still higher.

Future planting outlook is mixed. The eastern corn belt has been mainly dry the past few days, which should’ve offered a great window. The next few days should offer a window as well in the eastern belt.

However Iowa has had 3-8 inches of rain, with more on the way. This could be a drought buster for Iowa.

We have bred genetics that are able to handle a drought fairly well. Take last year for example. However, we can’t teach the crops to swim. Most would agree that a wet spring like this is far worse than a drought.

It's not so much the fact that we aren’t going to get the crops in. That isn’t really the concern. There is some concern about pushing the crop into a less favorable window, but we all know how quickly we can get things in the ground.

The biggest issue I see with this wet of a spring is mudding the crop in the ground. The compaction issues that come with that. Heavy rain springs require timely rain through out summer as well. Right now the summer outlook still points hot & dry with the La Nina.

Once crop conditions come out, Iowa is going to be looking at likely a sub 50% G/E for corn. When we get these conditions and they start coming in lower than last year, the market could get excited.

To go along with this, there is talk about potential prevent plant acres on corn.

Only part of this rally has been a "delayed planting rally". We have drought in central Brazil, flooding in the south. Cuts to Argy crop. The Russian wheat situation. And more than anything, this rally has been driven by the funds and technicals...

Let's jump into the rest of today's update...

Today's Main Takeaways

Corn

Good action in corn the past few days. Fast planting, yet we held in there.

As mentioned, delayed planting isn't the only factor I see driving this market.

You can’t mud a crop in then have a dry and hot summer…….

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IN TODAYS UPDATE

Why I see corn higher a month from now
Is 2024 like 2014?
Targets for corn & beans
What level we need to break to see upside
Funds want to be long
Why wheat has so much potential
Is Russia situation a game changer?
Exactly what you should be doing for wheat. Sales, calls, puts, selling the carry & more.

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Check Out Past Updates

5/21/24

BEANS NEAR NEW HIGHS. WHAT TO DO WITH WHEAT?