Chicago Agriculture Commodities Finished Lower on the Week

Chicago Agriculture Commodities Finished Lower on the Week


Chicago Board of Trade (CBOT) agriculture commodities finished lower on the week ended 20 April, mostly on improved weather forecast and investors’ technical selling.

The most active Corn contract for July delivery fell 9.75c weekly, or 2.52%, to 3.765 bu.

July Wheat delivery dropped 9.25c, or 1.96%, to 4.6325 bu.

July Soybean went down 14c, or 1.33%, to 10.5425 bu on the week.

CBOT Corn futures fell nearly 10c on improved central US weather.

Agriculture analysts suggest that on a nationwide basis, planting dates correlate poorly with yield potential. National Oceanic and Atmospheric Administration’s climate update this week also suggests normal weather is most likely continuing into July.

However, the structure of world feed grain markets has changed enough to keep breaks shallow and short lived.

Ethanol margins remain elevated, Barley and feed Wheat prices rest at multi-year highs.

Wheat futures fell as US  Plains sees a moderate boost in soil moisture at the weekend. US export demand is disappointing, and on rallies the United States’ position in the world market worsens.

The weekend’s rainfall did not materially affect hard red Wheat production after 5 months of dire drought. And assuming trend yields, major exporter stocks fall noticeably in Y 2018 while world Wheat trade is expected to grow due to improved emerging market economic growth and a lack of new Northern Hemisphere Wheat acreage expansion.

Russia may produce another big crop, but between now and July a heavier burden is being placed on Mother Nature relative to recent years. Longer term price trends are turning more Bullish of Wheat and sales are only advised on supply driven rallies.

Soybean traded lower through the week on large US cash market supplies and a weak Brazilian Real. Chinese demand is largely focused on Brazil, and US sales and shipments remain seasonally slow.

However, domestic Soy crush demand remains exceptionally robust, and National Oilseed Processors Association reported a record large March crush rate. Similarly strong margins have held through April, while weekly Soybean meal exports remain strong.

Slow export demand, strong domestic demand, and delayed Corn and Spring Wheat planting is expected to keep Soybean futures in a wide range.

Have a terrific week.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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