Chicago Agriculture Commodities Traded Mixed on the Week

Chicago Agriculture Commodities Traded Mixed on the Week

Chicago Agriculture Commodities Traded Mixed on the Week


Chicago Board of Trade (CBOT) agriculture commodities traded mixed on the week ended 4 May, with Soybean futures dropping nearly 2%.

The most active Corn contract for July delivery rose 7.75c weekly, or 1.94%, to 4.0625 bu.

July Wheat delivery added 27.75c, or 5.57%, to 5.2625 bu.

July Soybean dropped 19.5c, or 1.85%, to 10.3675 bu on the week.

CBOT Corn futures found new multi-month highs on expanding drought in Brazil, a rained slowed harvest in Argentina and new fund investment.

Agriculture analysts suggest Black Sea area Corn planting will be steady or even lower as more resources are put into Oil Seed production.

No material change in Brazilian dryness is indicated in the next 2 weeks.

Argentine yield reports through early May have been disappointing, and the US Department of Agriculture’s (USDA) already-low production forecast is still 0.5-1.5-M tonnes too high.

The loss of crop in South America and the loss of acres in the United States are structural issues and traders remain patient extending sales.

Following the historical dryness in the US Western Plains and Australia, and as Argentine planting will be slowed into late month by excessive rainfall and flooding, there’s little room for error with respect to Black Sea production.

Already major exporter stocks will be down some 10-12-M tonnes assuming trend yield. Analysts suggest the market has found a new level of fair value, with July futures ranging between 5.00-5.60 bu.

The world still has huge old crop stocks that need to move.

Soybeans marked weekly highs last Monday, and spent the rest of the week trading lower as traders waited news on China’s consultations with the United States on some issues in their economic and trade.

Although the 2 countries reached agreements last Friday, agriculture analysts expect that Chinese trade and record large fund length in Soymeal will hang over the market before the May World Agricultural Supply and Demand Estimates(WASDE) report released by US Department of Agriculture.

Soybean planting progress has advanced across the Central US Midwest, while progress in other areas is just beginning. So, look for US Soybean planting progress through Sunday to be 10-12% completed, near 5-year average.

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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