July CBOT corn futures shed 11-3/4 cents this week to close at 630-3/4.
December CBOT corn futures shed 9-1/2 cents this week to close at 588.
After rallying nearly 30 cents above the $6 level December corn futures struggled to end the week shedding over 32 cents on Friday. New crop futures tested and closed above the 200-day moving average but from a weekly perspective this is poor price action.
Rainfall chances for most of the corn belt over the next seven days have steadily increased this week. According to the latest model consensus from NOAA most of the I-states are expected to pick up at least a half inch of moisture by July 1.
64% of US corn areas were in drought as of Tuesday, up from 57% a week earlier and the most ever for this week of the year. Severe drought coverage jumped to 27% from 19% a week earlier.
Safrinha corn harvest in Mato Grosso Brazil was 8.3% complete as of late last week compared to 25.5% last year. Early corn yields have been a little disappointing but are expected to improve as harvest progresses given good moisture throughout the growing season.
November Soybeans Lower on the Week.
July CBOT soybean futures added 28-1/4 cents this week to close at 1494-1/2.
November CBOT soybean futures shed 32-1/4 cents this week to close at 1310.
Export sales of US soybeans were strong this week, marketing year to date soybean export sales are still running 82 million bushels behind the pace needed to hit the USDA’s marketing year target that ends in August, but this compares to being short by 88 million bushels last week.
Volatility remained intact this week for November soybean futures as prices traded in a 77-1/4 cent range in the four-day trading week. This week’s close below the 200-day moving average for November beans as well a sharp weekly break in soybean oil futures opens the door to further liquidation if rainfall forecasts verify in the week to come.
While short-term rainfall is of vital importance to soybeans, later season rains as we near and work through the month of August are arguably just as if not more important. Two-sided volatility will surely be weather dependent especially as daily price limits for soybeans expanded to $1.05 per bushel this week.
Cheap Brazilian beans have and are expected to continue to flow into Chinese ports in the months to come. A record 12 million tons arrived in May, 11 million tons are expected in June followed by another 10-11 million tons in July and August. Another 8.7 million tons of Brazilian beans are expected to be bought by Argentina this year to make up for drought losses.
Wheat Higher on the Heels of Winter Wheat Harvest.
July CBOT wheat futures added 45-1/4 cents this week to close at 733-1/4.
July KCBOT wheat futures added 17 cents this week to close at 859.
July MGEX spring wheat futures added 11-1/4 cents this week to close at 864-3/4.
Continuous CBOT wheat futures closed right at the pivotal 200-day moving average to end the week, prices have not been able to close above this level in two consecutive trading days since late June of 2022.
Early yield indications for both the winter wheats have been good with yields exceeding 100-bushels per acre in some areas. Harvest selling pressure is expected to limit any major upside moves for wheat especially if corn and soybean prices stall.
Spring wheat areas look to benefit most from expected rainfall over the next seven days. Most areas of North Dakota and Northwest Minnesota are forecast to pick up close to two inches of rain by the end of the month.
Milk Markets Find Support
Second month, Q3, and Q4 Class III contracts all closed higher this week; Class IV fared similarly although Q4 did fall 3 cents.
The spot markets for cheese, whey, powder, and butter were mixed with marginal gains and losses.
May butter inventory was 14% larger while cheese inventories were 1.5% smaller than last year.
US dairy cow culling for the week ending June 10th, up 13.7% from the same week last year.
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