Closing Market Comments 5-19-2022

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Today’s Prices

Grain Prices finished mixed today as the outside markets tried to somewhat consolidate after yesterday’s big losses.

Grain Market News

Dow Jones Industrial Average

From the highs posted around the first of the year just shy of 27.000, today’s lower move in the Dow pushed it to a new low for the move with the stock market down nearly 6000 points since the first of the year.

Yesterday’s big collapse was somewhat triggered by Walmart and targets quarterly earning which were significantly below expectations.

Crude Oil

Although crude oil was down yesterday and down sharply this morning it has turned around and is trading higher today.

Overall, the rally yin the crude oil market and the uptrend does continue for crude at this time.

Grain Market News

Global Wheat Exporters

This chart shows the USDA estimates prior to Russia’s war against Ukraine.

It shows that the European Union would be the largest exporter in the world at 37.5 million tons, Russia at 35 which has been raised to 39, Australia was considered to be the third largest exporter at 25.5 with Ukraine prior to the war estimated at 24.2 and is now revised to 19.0.

Russia’s war against Ukraine certainly reducing Ukraine exports this year and possibly further next year.

Corn Weekly Export Sales  

Weekly corn sales came in at 435 thousand tons, that was somewhat disappointing and one of the lowest totals we’ve seen since January.

The good news is we got such a significant export book on that it was still above the level needed which is 269 to reach USDA export forecast.

World Corn Futures

Prices compared to where they were at on January 1st, European wheat in red has rallied 63% while US corn had only rallied just over 33% and prices have fallen in the last couple of days.

Europe is a net importer of corn, and they typically get the majority of their imports from Ukraine, given the fact that European corn continues to rally while US corn has slipped lower tells us that the US should see a strong export program to the European Union for corn.

Soybean Weekly Export Sales

Soybean exports had a very good number at 753 thousand tons, when you look at the level needed it shows -57. This means we have already sold more soybeans than USDA has projected for the marketing year.

Its certain that USDA will have to raise exports for soybeans which will tighten stocks.

Wheat Weekly Export Sales

Wheat only has 2 weeks left in the marketing year and typically if you look at this chart, we don’t have many exports at the tail end of the year.

The good news was 325 thousand tons of new crop wheat was sold beginning June 1st.

The bottom line with wheat is that the crop marketing year is coming to an end and sales this time of year do not have an impact on final export numbers.

3-Day Observed Precipitation

We have had some lighter rains this week for the most part.

Most of the corn and bean belt has seen a .25-.50 inch of rain and some with less or more.

The only big rains have been in portions of eastern Nebraska, southwest Iowa, and then eastern Kansas and neighboring portions of Missouri and Oklahoma.

Almost all of North Dakota is seeing rains which is disappointing for planting.

U.S. Radar

You can see the rains covering almost all of North Dakota with them moving to the east which will keep them from the field and further delay planting.

Much of the corn and bean belt is free of rain at this time but we do have rains that are developing and moving to the north and east. Most of the eastern corn belt will get significant rain over the next 2-3 days.

7-Day Precipitation Forecast

Most of the eastern corn belt is expecting 1-2 inches of rain but they have been able to plant quite a bit recently, but these new rains will further delay planting though.

Temperature Outlook

The temperatures look somewhat cool to the north and warmer to the south in the 6-10 day.

The 8-14 day generally shows mostly a warmer pattern for everywhere.

Precipitation looks dry for the 6-10 day in the southwestern plains, above normal precipitation in the central and eastern belt, and a similar pattern in the 8-14 day with dryer conditions in the southern sand western plains and wetter in the north and the east.

July Corn Chart

Corn prices trading lower today, breaking below trend line support shown by the blue arrowed line and finding support at the black line which is the 40-day moving average.

We mentioned yesterday if we did not find support at our trend line that the next target would be around the previous lows from a week ago at 7.69 and todays low came within 4 cents of that low.

Additional chart support is at 7.69, that’s 14 cents below todays close with current overhead resistance at 8.10.

July Soybean Chart

Soybean prices are in a solid uptrend off the lows posted 1.5 weeks ago and technical indicators are pointed up as well.

No signs of topping action and a little friendly news could allow soybeans to test the upper end of the trading channel that’s been in place since February.

July KC Wheat Chart

Wheat prices down for the second day in a row, we were able to fill the gap that was left Monday morning.

The short-term chart has turned downward and the technical as well.

There is no sign of bottoming action, we are not overly bearish wheat, but we could see some additional chart day selling.

Questions or Comments

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