CORN HIGHLIGHTS:

• Corn futures finished higher on the session as recent rainfall lacked the coverage and intensity that was anticipated, causing additional short covering as prices pushed higher through some levels of resistance.
• Weekly crop ratings will be released on Monday afternoon, and expectations are for an additional drop in corn ratings to 62% good/excellent, down 2% from 64% last week.
• The weather will stay as the market’s focus as weather models are variable over the next 10 days as overall rainfall still looks limited, pressuring the stressed crop.
• Demand remains a concern as the weekly export inspection report was released on Monday morning. Last week, U.S. exporters shipped 1.169 MMT of corn, near the top end of expectations, but still behind the pace needed to reach the USDA corn export goal. Corn shipments are still down 31% year–over–year.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day mixed with the July contract posting losses and deferred contracts gaining as first notice approaches and funds likely rolled out of some of their Jul contracts and into Sep and Nov. Soybean meal closed slightly higher, while soybean oil fell alongside crude.
• Export inspections for soybeans were low at 5.2 mb and put total inspections for 22/23 at 1.794 bb which is down 3% from last year. The USDA is estimating soybean exports at 2.000 bb for 22/23 which is down 7% from last year.
• Weather has been a key factor for the moves in corn and this past weekend’s rains were spotty and underwhelming, but soybeans have more time before rains become crucial and so did not keep up with the gains in corn today.

WHEAT HIGHLIGHTS:

• After a two-sided trade, the wheat complex closed mostly higher. Wheat acted as a follower today and was likely pulled higher by the corn market into the end of the session.
• Weekly wheat export inspections were pegged at 9.1 mb., bringing total 23/24 inspections to 12 mb. The USDA is estimating 23/24 wheat exports at 725 mb versus 775 for 22/23.
• Some support may have come from higher Paris milling wheat futures. Dry conditions in Spain and northern France may be the reason for Matif wheat’s uptrend since the May 31 lows, and because of this dry weather, one analyst group is estimating a decline in European wheat production of 2.1 mmt.
• Managed funds are estimated to still be net short 122,280 contracts of Chicago wheat. With uncertain weather, in addition to global political and economic uncertainties, this could prime the wheat market for a short covering rally.
• On Friday’s USDA report, US HRW wheat production was increased by 11 mb, and this is being attributed to recent rains in Texas and Oklahoma that helped the crop. Kansas production was left unchanged in the report.

DAIRY HIGHLIGHTS:

• The spot trade saw no loads traded across all products today. Spot butter remains in its long-term range, while cheese, whey, and powder all test multi-year lows.
• July Class III futures posted a new low close at $15.93 today, but the running second month chart is still about 60 cents above the lows from a few weeks back.
• Class IV trade action was mostly quiet today but July fell back underneath the $17.00 mark, although no contracts traded.
• Managed money was still net short 6,001 contracts as of June 6th, just barely off the record from a week before at 6,125 contracts.

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Author

Brandon Doherty