Markets are trading with losses overnight with threats of new tariffs weighing on most markets. Trump reportedly said he’s recommending a 50% tariff on goods from the EU as well as tariffs on any Apple products not made in the U.S. Equity markets are trading sharply lower on the news.
Managed funds on Thursday were estimated as even in the corn to leave the net short at 57k, net buyers of 5k beans to push the net long out to39k, and net sellers of 3k wheat to push the net short out to 112k.
French wheat ratings dropped 2% to 71% g/e. That is still well-above last year’s rating of 63% g/e. Barley ratings fell 6% to 75% g/e on dry weather. Corn ratings dropped 1% to 87% g/e. Market participants continue to monitor potential heat stress to Chinese wheat crops as well as spring weather in Russia.
The IGC raised their global corn production forecast by 3 mmt to 1.277bmt (USDA 1.265). They estimate the global wheat crop at 806 mmt (USDA 808.52).
Turkey estimated their grain production this year would be off 4.1% to 37.4 mmt with a severe frost hurting production prospects. Wheat production was forecast to drop by 5.8%.
Russia said they had removed their minimum wheat export price recommendation for grain exporters until the end of the export season on July 1st.
Corn posted a higher high, higher low, and higher close again on Thursday with prices continuing their recovery to the middle of the range that we’ve seen over the last 3 months. The market is overbought after recent gains and is struggling to push above resistance at 4.60. Support is below the market at 4.40.
Beans posted a higher high, higher low, and higher close on Thursday with the market recovering to the upper end of its recent range. Directional indicators are mostly neutral with potential for a large move in either direction. Support is 10.40 and resistance 10.60 and 10.67.
Corn is pulling back this morning on tariff concerns but overall has had a very good week from a price standpoint. The move to the downside a couple weeks ago was overdone and we are likely to enter a period of consolidation as the market waits to see how the U.S. growing season starts. The biggest concern right now is parts of S. IL, IN, and OH that have been wet, but planting progress on a national level is still ahead of average. With the market recovering to resistance and tariff headlines hitting the market again, this isn’t a bad time to look at option strategies that will establish floors as we are still in a very uncertain environment.
Beans were on track to approach recent highs overnight before tariff headlines hit the market this morning and pushed prices lower. Managed funds are still long and the global supply/demand outlook is bearish regardless of whether tariffs are announced or not. Producers should make sure sales are caught up and look at puts to protect the downside on unsold bushels.
Corn down 3-4
Beans down 5-7