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Grain markets finished sharply higher across the board with a number of factors coming together including short covering ahead of Wednesday government report and also a warmer, drier outlook for the northwestern belt.
Grain Market News
2021 Planted Acreage
Grain Market News
7-Day Precipitation Forecast – Last Monday
A week ago the forecast was calling for soaking rains over most of the U.S. corn and bean belt. At that time, the exception was the northwestern belt and maybe the far western Plains.
7-Day Observed Precipitation
Over the past 7 days we did get soaking rains through much of the U.S. corn and bean belt. The northwestern belt saw the least amount of rain although ND probably got better rains than expected. Some scattered rains fell in the western Plains as expected. What was unexpected was a big gap in rain in the OH Valley down into the Delta but they have pretty good subsoil moisture so it’s not likely to be a major factor at this time. Bottom line, although the forecast wasn’t perfect, the forecast did forecast soaking rains through much of the central U.S. corn and bean belt and many of those areas did get soaking rains.
30-Day Precipitation % of Normal
When you add up the rain that fell over the last week or so with the last 30 days, in the 30-day precip % of normal shows the biggest rainfall deficits in southern MN and SD. Although we still have deficits in much IA, much of central NE, and KS as well. While most of the eastern corn belt is in pretty shape and the Delta has been pretty close to average over the last month as well. It’s the areas in brown and red that would see the crop stress increase the most if we start another drying trend. Looking back, a larger area within MO, IL, northern IN, and MI that have had some huge rains.
Rivers in Flood Stage
This map shows rivers at flood stage as of this morning. You can see from the heavy rain areas in MO through IL, northern IN, and MI is where we’re having issues with rive flooding. We don’t think this is a wildly bullish factor but its worth noting that we had some excessive rains in portions of the central and eastern belt.
7-Day Precipitation Forecast
Today’s 7-day precipitation forecast shows very little to no rain in the central and northern Plains into the northwestern blet. And that is one of the reasons the market rallied today. It could very well be that we start another drying trend and heat is expected to build into the 90’s into the northwestern belt and into the Plains states. The eastern and southern half of the belt should remain in pretty good shape if the forecast is correct.
6-10 and 8-14 Day Forecast
The longer term 6-10 and 8-14 day outlook shows a similar pattern to what has been forecasted over the last week and that is a divided corn belt; warmer and drier to the northwest, cooler and wetter to the southeast. That’s what the forecast was hinting at last week and they’re still hinting at warmer and drier to the northwest including portions of IA and that pattern could create additional crop stress as we head into the pollination period and that’s one of the items that contributed to today’s rally.
December Corn Chart
When you hear comments that the corn market is in an uptrend or downtrend you have understand if it’s short-term, intermediate, or long-term trend. For example, corn is still in a long-term uptrend. The intermediate trend is sideways as we’ve had extremely volatile up and downs and now we’ll see where we go from here. The short-term trend is down. But today’s sharp move higher and sharply higher close is certainly a positive signal and it was enough to move the technical indicators as well. The market from a chart or technical perspective hinting that we may want to move, at a minimum back to the 20 and 40-day moving averages around the $5.70 level. That’s about 20 cents from where we closed today.
November Soybean Chart
The soybean chart is still in a long-term uptrend. The intermediate trend has been choppy and sideways and the short-term trend is a downtrend. But today’s move higher is a very positive sign as we traded and closed sharply higher, indicating the soybean market may be finding some bottoming action on the chart and also maybe finding some bottoming action on the technicals as well. The next overhead objective if we can get some friendly news would be up around the $13.70 level where our 20 and 40-day moving averages come into play and that’s about 50 cents above where we closed today.
July KC Wheat Chart
Wheat prices actually started to indicate a turn last week and today’s big move to the upside was a new high for this move. Technical indicators clearly turned higher. The wheat market is now indicating at we could have some additional upside potential based on chart and technical indicators. The obvious chart point is the highs posted a few weeks ago at $6.54 and that’s about 30-35 cents above where we closed today.
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