CORN HIGHLIGHTS:

• The corn market traded both sides of unchanged on the spotty nature of the weekend’s precipitation but closed mixed on technically driven profit taking in the spreads and increased chances for moisture across the Midwest next week.
• Recent forecasts with both the European and the US models are calling for additional rain in the northern Midwest and eastern Corn Belt early next week. Rain this week is expected to favor western Nebraska and the northern Plains. Outside of that, it will remain dry, and if the forecast does not verify, the market may be in for another leg up.
• Secretary of State Anthony Blinken visited China to meet with President Xi Jinping and helped to smooth the US relationship with China, though concerns remain about the stability of China’s economy and its commitment to become more self-reliant.
• Brazil’s second corn crop (safrinha) harvest is underway and with a lack of storage for both soybeans and corn, nearby basis is getting hit hard with farmers selling, adding further resistance to US prices.
• Last week it was reported by the Commodity Futures Trading Commission that Managed Money funds bought a large 47k contracts between June 6 and June 13, thereby flipping their net position from net short 44.5k contracts to net long 2,145 contracts.
• The USDA will release its weekly Crop Progress report this afternoon with many looking for lower ratings than last week’s 61% good to excellent rating due to the relatively dry conditions last week and the relatively spotty rainfall over the weekend.

SOYBEAN HIGHLIGHTS:

• Soybeans were mixed today trading both sides of unchanged and ultimately closed higher in July and November but lower in September. Both soybean oil and meal ended lower, and crude oil closed lower as well.
• Crop progress will be released at 3pm today and trade is estimating that the good to excellent rating will fall by 2% to 57% after disappointing and spotty rains over the past week.
• Some support came from Secretary of State Anthony Blinken’s visit to China where he met with President Xi Jinping. The meeting apparently went well and soothed tensions. On the other hand, there have been some concerns that China’s GDP is lagging.
• The EPA is slated to make their announcement regarding renewable diesel mandates tomorrow which could have a big impact on profitability.
• Funds were buyers of soybeans by 33,901 contracts last week increasing their net long position to 47,882 contracts.

WHEAT HIGHLIGHTS:

• After a two-sided trade, wheat finished with decent gains in the Chicago contract. Kansas City futures posted losses, with the nearby contracts down more than the deferred. This spread action may be related to the 7-day forecast for HRW areas, which is mostly dry, and may lead to increased harvest pressure.
• Parts of Canada received heavy rains this weekend, which may account for the decline in spring wheat futures prices today.
• Russian spring wheat areas remain in need of moisture. The longer-range forecasts suggest these areas will get some rain. Northern Europe is also dry but looks like it will get some rain too.
• Contrary to what normally happens in an El Nino year, Australia is getting rain. This could help their wheat crop, but it is possible that drought conditions could still develop over time.
• Algeria is said to have purchased between 580,000 and 620,000 mt of milling wheat, likely sourced from Russia.
• Managed funds reduced their net short position in Chicago wheat last week but are estimated to still be short more than 113k contracts as of last Tuesday.

DAIRY HIGHLIGHTS:

• Nearby Class III milk futures finished the day anywhere from unchanged to up 16c for the session. The recent feed rally along with a 0.25c bid higher in cheese blocks added support.
• The Global Dairy Trade auction was mostly uneventful, with the GDT price index holding steady at 1,002 points.
• Within the GDT auction, cheddar fell 3.30%, butter added 5.50%, and whole milk powder was flat.
• The dairy market will now turn its attention to tomorrow’s US Milk Production report with the May data. Production and milk cows had both been trending down in recent reports.

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Author

Brandon Doherty