TFM Morning Update 07-17-2023

CORN

Corn is trading higher and gapped slightly higher overnight after Russia announced that it was withdrawing from their participation in the Ukrainian grain deal.
The crucial grain deal was ended abruptly because the Kremlin claimed that it is not being used for the benefit of countries that it was intended for, but the move also comes as tensions heighten.
Weather has been another bullish factor this morning as a large portion of the Corn Belt is forecast to be dry over the next 7 days with warmer than normal temperatures.
Friday’s CFTC report showed funds increasing their net short position by a whopping 45,000 contracts which now puts them short over 63,000 contracts.

November soybeans are continuing to move higher but still have found resistance at the 14-dollar mark. Crude oil is trading lower below 75 dollars a barrel, but both soybean oil and meal are higher.
Soybeans dipped lower after the USDA report that showed higher ending stocks estimates than expected, and focus has shifted back to weather and world veg oils.
The closing of the Ukrainian grain deal does not impact soybeans directly, but it does impact the value of soybean oil as that region exports a lot of sunflower oil and meal.
Friday’s CFTC data showed funds as net sellers of soybeans by 6,394 contracts reducing their net long position to 82,748 contracts.

Wheat is trading higher this morning after the end of the Ukrainian grain deal which obviously impacts wheat the most but also comes during the US’s winter wheat harvest.
As winter wheat harvest presses on, the new supplies could make it difficult for futures to rally, and funds have already been content as sellers.
Spring wheat may be facing more weather-related challenges as rain is needed in the southern Canadian prairies and in North Dakota with a drier and warmer 8 to 14-day forecast.
Friday’s CFTC data showed funds as net buyers of wheat by just 1,878 contracts, slightly reducing their net short positions to 52,128 contracts.

Amanda Brill