Grain prices finished mostly higher today as the weather forecast may not be complete dry but it still looks threatening for the northwestern belt.
Grain Market News
U.S. Corn Crop Condition Rating
Heat and dryness allowed the U.S. corn crop conditions rating to decline down 4% from last week from 76% to 72% G/E. This compares to 75% G/E last year. And it’s worth noting that crop conditions were lower in the heart of the U.S. corn and bean belt. IA crop conditions down 4%, IL down 6%, NE down 4%, and MN down 7%. These are the top 4 producing states in the nation all seeing significant decline in their rating.
U.S. Soybean Crop Condition Rating
USDA posted its first official rating of the year at 67% G/E. The market was expecting something around 70% G/E so it was considered supportive for prices. The 67% G/E rating compares to 72% G/E last year at this same time. Unfortunately for U.S. farmers, if the weather forecast is correct we’ll likely see corn and soybean ratings slip lower in next week’s update from USDA.
High Temperatures: Mon June 7th
Yesterday’s high remained stressful for the northwestern belt where temperatures were in the 100’s in SD, mid to upper 90’s across much of southern MN and touching adjacent areas of northwest IA and northern NE. Temperatures in the eastern belt, southern belt, down into the Delta in the 80’s and quite favorable especially given the fact that many areas in the southern belt do have adequate soil moisture.
14-Day Precipitation % of Normal
Over the past 14-day the northern and western half of the belt well below normal rainfall over the past 14 days while much of the eastern belt down into the southern belt, central belt and southern Plains has seen very good moisture.
7-Day Precipitation Forecast
The 7-day precipitation forecast doesn’t show much rainfall in the central or heart of the U.S. belt. IA, western IL, northern MO, into southern MN looks to have very light rains. There are some better rains forecasted for the southern Canadian Prairies and that extends into the Dakota’s and NE as well. We’ll see if that forecast verifies. Those rains would certainly be welcomed. Better rains expected in the eastern belt, OH Valley, down into the Delta.
6-10 and 8-14 Day Forecast
The 6-10 and 8-14 day forecasts continue to show above normal temperatures for the central and western belt. The only area showing below normal temperatures would be along the OH Valley down into the Delta where conditions are pretty good at this time. Unfortunately, precipitation looks to be below normal for almost the entire U.S. corn and bean belt in both the 6-10 and 8-14 day forecast and therefore with above normal temperatures and below normal precipitation in at least half of the belt we view the current forecast as threatening and if the forecast verifies additional crop stress will be discussed in the markets over the next couple of weeks.
Grain Market News
U.S. Ending Stocks
World Ending Stocks
South American 2021 Production
July Corn Chart
Today’s corn chart does not show much change. It was an inside day. Today’s range stayed below yesterday’s high and above yesterday’s low, an inside trading day. But the chart still has an upward bias and we’re trading above our moving averages. Technical indicators are still pointing upward and are not oversold. The chart and technicals tell us there could be additional upside potential but weather and the forecast will determine price direction in the days and weeks to come.
July Soybean Chart
Soybean prices also having an inside day. We did not take out yesterday’s low. We did not take out yesterday’s high. Somewhat of a consolidation day but the chart still has a gradual uptrend and we’re trading above all our moving averages in beans. Technical indicators are pointed upward and not into the overbought area yet either. The soybean chart and technical indicators are similar to corn in that they don’t indicate any topping action but we do need to repeat that weather that will drive price direction in the days and weeks to come.
July KC Wheat Chart
Wheat prices are also in an uptrend and wheat also had an inside trading day. No strong bias in today’s trade in wheat. The chart is pointed upward. Technicals are pointed upward so no topping action in KC wheat. The next level of overhead resistance would be the double top that we saw at the $6.61 to $6.67 level in January and February.