Chicago Agriculture Commodities Finished Lower on the Week Ended 29 June

Chicago Agriculture Commodities Finished Lower on the Week Ended 29 June

Chicago Agriculture Commodities Finished Lower on the Week Ended 29 June

$SOY, $WEAT, $CORN

Chicago Board of Trade (CBOT) agriculture commodities finished lower on week ended 29 June, with Soybean futures dropping nearly 4% as grain traders turned to technical selling amid trade tensions.

The most active Corn contract for July delivery fell 7c weekly, or 1.96%, to 3.5025 bu.

September Wheat delivery went down 3c, or 0.59%, to 5.0425 bu.

November Soybean dove 36.25 cents, or 3.96%, to 8.8 bu, on the week.

CBOT corn futures fell on anxiety over global trade, and favorable US weather to date. Crop ratings indicate yield potential of 180 BPA, which along with concern over export moving forward has kept price soft.

US Department of Agriculture (USDA) added 1-M acres to planted and harvested area in its June report. The new crop balance sheet will loosen slightly in July.

Agriculture analysts note that while concern on trade persists, the break has boosted Ethanol production and blending further.

Exports rebounded strongly from the prior week.

Gulf Corn is competitive with South American origin through Summer, plus there also rising concern over yield in Russia and much of Central Europe.

Fundamentally the market is very much undervalued.

Rallies will struggle until US-Chinese negotiations resume.

In Corn, risk centers on a collapse in Sorghum export demand, and thus more competition for US Plains feed use.

Wheat futures ended mostly lower.

Harvest pressure noted, as is the quality of this year’s hard red Wheat crop. Protein levels will be a multi-year high, and a greater amount of high quality Wheat will be available in Y 2018.

Spring Wheat acres expanded by 600,000 from March intentions. Market focus also rests upon Chinese grain imports, with NAFTA issues to follow soon after.

There’s no doubt global trade flows are important, but non-US production continues to slide.

France’s Wheat crop was cut a sizable 4-M tonnes (10%) from prior estimates.

Russian Wheat production is pegged at 65-66-M tonnes.

Germany and Poland’s production is unlikely to exceed that of MY 2017/18.

Friday’s grain reports did not offer any major surprises, and confirmed record large stocks along with a slight increase in new crop acreage. After a quick and volatile trading response, Soybean futures ended slightly lower Friday and on the lows of the week.

Crop ratings Monday are expected to be steady to possibly lower as widespread, Hot US temps look to put crops under stress this week and the heat looks to continue well into this week.

Have a terrific 4th of July Freedom 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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