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Grain markets closed mixed today as the marketplace battled between rains that fell benefiting crops versus areas that missed out on rain where crops are still under stress.
From southeast MN, through a good portion of IA and the eastern corn belt saw very good rains. There were some exceptions like central IA but for the most part that area saw some very good rains over the past week. Unfortunately, out in the western corn belt into the northern Plains, large areas either very little or no rain at all over the last 7 days and portions of the central and southern Plains also missing out on rains where crops are likely still being stressed. When it comes to rainfall that has taken place over the past week, very mixed news. A little bit of something for the bulls and the bears.
A map showing our 30-day precipitation as a % of normal shows that even though we’ve gotten some good rains, much of the central and western corn belt into the Plains showing we’ve received well below normal precipitation over the past 30 days. Again, this includes the rainfall that fell over the weekend.
It’s easy to see on a temperature maps that a cold front has come through. Temperatures at 1pm this afternoon in the upper 60’s or low 70’s in much of the belt. This is 25-30 degrees cooler than it was last week at this time.
Very good rains are forecast for IA and the eastern corn belt while the northwestern belt into the central and northern Plains looks like they could miss out. From a production perspective, the heart of the belt looks to have good rain over the next 7 days. Much of this falling in the Thurs, Fri, Sat timeframe.
Cooler temperatures remain in the heart of the belt in the 6-10 day. Those cool temperatures pushing towards further to the southeast in the 8-14 days with heat showing up in the far northern Plains. It’s also worth noting, the dryness expected to start rebuilding in the central belt into the northwestern belt and northern Plains in both the 6-10 and 8-14 day. This is what the bulls are monitoring to see if the ridge and hot dry temperatures could possibly return towards the end of June/early July.
Export inspections came in at 58 mb inspected for export last week. That was fairly close to trade expectations. Down a little from last week but up a little bit from last year. Year to date, export inspections are up 72.9%. USDA is currently estimating exports will be up 60% this year so we’re still ahead of pace to reach USDA’s export target.
Soybean export inspections came in at 6 mb. That’s a fairly small number. A little bit below last year and a little bit below the level needed to reach USDA’s export forecast. Year to date exports are up 56%. USDA is projecting exports will be up 35% so we shouldn’t have too much difficulty reaching USDA’s target.
Corn prices have been trending lower over the last week/week and a half. Technical indicators have been turning lower. Today’s bounce in the market was definitely a positive as we did take out Friday’s high and technical indicators showing signs of wanting to turn higher. The market has been able to find chart support down in the $6.29-$6.30 area. And we currently have overhead resistance just above today’s high where our 10, 20, and 40-day moving averages are all converging. This market may chop around back and forth for a few days while the market waits for more clarity on the forward moving forecast.
Soybean prices have been in a steep downtrend over the last week and a half to two weeks. Technical indicators got extremely oversold near the zero mark. The bounce Friday and today’s follow through to the upside certainly good news for the short-term chart. We’re still in a downtrend but showing signs of wanting to turn and the technical indicators have also turned upward. With just a little bit of friendly news this market may be interested in testing overhead resistance up in the $14.40 area, about 30 cents above where we closed today.
Wheat prices have also been in a downtrend over the past week and a half or so. Technical indicators have been turning down but we have stabilized over the last couple of days. And the technical indicators showing some signs of stabilizing as well. We currently have chart support down in the $5.83-$5.75 range. Overhead resistance up in the $6.20 range where our 10, 20-day moving average and down trending line all converge. Today’s close right around $6 means we have about 20 cents upside potential and about 20 cents of downside risk as well.
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