Grain markets closing sharply lower across the board as the weather forecast has turned cooler and wetter for next week.
Grain Market News
6-10 Day Forecast
Last week on Friday it was calling for above normal temperatures in most of the U.S. corn and bean belt and below normal precipitation for the entire central U.S. including all the corn and bean belt. Today’s forecast calling for about normal temperatures in almost the entire U.S. corn and bean belt with the precipitation below normal only in the northern Plains with most of the corn and belt showing above normal precipitation. This is the 6-10 day forecast and it shows a dramatic change compared to last Friday.
8-14 Day Forecast
Last Friday it was calling for above normal temperatures in virtually all of U.S. corn and bean belt and below normal precipitation in virtually all of the U.S. corn and bean belt. Today it is calling for normal temperatures and above normal precipitation for virtually all of the U.S. corn and bean belt. A complete 180 versus last Friday’s forecast. Normally when the forecast changes it’s just tweaking the previous forecast but today’s forecast a complete flip-flop compared to last week.
High Temperatures Sat June 12th
Temperatures in the 90’s in the eastern belt, even some upper 90’s in the northern Plains.
High Temperatures Sun June 13th
Sunday had 90’s across most of the western belt with upper 80’s and few low 90’s in the eastern belt. These temperatures may not include many 100’s over the weekend but certainly temperatures in the 90’s well above normal for the first half of June.
7-Day Observed Precipitation
Over the last 7 days we’ve seen some pretty good precipitation in the northern Plains and in the eastern belt down into the Delta. In fact, the Delta even saw some excessive rain and flooding in AR and MS. Unfortunately, in the central belt very little to no rains fell over the past 7 days and some of those areas have not seen rain since May 27th.
14-Day Observed Precipitation
Very little rain in the central belt over the past 2 weeks and a pocket in the central Plains has been dry for the past 2 weeks as well. It’s these dry areas in the central belt that could see dramatic crop condition rating decline in this afternoon’s weekly update.
14-Day Precipitation % of Normal
Not only did we not see much rain but when you look at a 14-day precipitation compared to normal, normal would be a little over 2” in 2-week period, about 2/3’s of the U.S. corn and bean belt is well below normal over the past 2 weeks. It’s the areas from southern MN into IA and neighboring areas of WI, IL, and MO that could see a significant decline in crop ratings today.
7-Day Precipitation Forecast
But as we mentioned the marketplace is looking ahead at the forecast. The 7-day forecast shows pretty solid rain across most of the U.S. corn and bean belt. Anywhere from 0.75-1.5” of rain is now being forecast with most of this rain late Thursday, Friday, and into the weekend.
Grain Market News
Corn: Weekly Export Inspections
This week’s number at 60.7 mb is up slightly from last week and slightly below the level needed to reach USDA’s current export forecast. Our export inspections year to date are up 75% from a year ago. USDA is projecting that exports will be up 60% so we are ahead of pace to reach USDA’s current target.
Soybean: Weekly Export Inspections
Today’s inspections at 4.7 mb, a marketing year low and well below the level needed to reach USDA’s export forecast. But because of the massive exports that we saw in the Oct through Feb timeframe we’re ahead of pace. Year to date we’ve exported 56.8% more than a year ago. USDA’s projecting we’ll export 35.6%. We are currently on track to reach USDA’s target as long as we can see export inspections rebound a little bit as we move through the balance of the summer.
July Corn Chart
We reconfigured the chart after last Friday’s big drop in prices and then again today combined with the fact that last week’s high at $7.17 did not take out the previous high from May. This allows us to draw a downtrend line off of the past two months highs and then an uptrend line that is ongoing. Chart support is in the $6.40 area and overhead resistance is a little bit above $7. Anything within this range is fair game based on weather forecasts that are released over the next couple of days. With the drop in prices that last couple of days, it was enough to turn the technical indicators so chart and technical indicators are much more negative looking than they were just last week.
July Soybean Chart
We’ve also re-configured this chart to show last week’s high did not take out the high from the month of May. That allows us to draw a new downtrend in place. Next chart support down around $14.40, 20-30 cents below where we’re currently trading. The soybean chart has also turned down over the last week with technical indicators pointed downward as well. We do want our listeners to realize the chart and technicals are worth noting but changes to the weather forecast will trump any chart or technical signal at this time of year, in the heart of the growing season.
July KC Wheat Chart
Wheat chart is also in a downtrend in the short-term following the recent break in prices. Technical indicators have hooked downward based on the weak performance the last couple of days. Wheat prices have support down around the $6 level with overhead resistance around $6.50, the highs from last week.