Explore Special Offers & White Papers from ADMIS

Ag Market View for June 28.22

SOYBEANS

Soybeans ended higher. Word that China was relaxing covid quarantine restrictions offered support. SN-SU spread hit +185. US domestic cash markets are tight with crushers and exporters trying to increase ownership. C IL flat price is near 17.00. Some grain analyst are suggesting US farmers clean out old crop soybean bins before summer weather and harvest. US domestic cash soymeal basis is also firm helping SMN. Some note that current US central Midwest soil moisture levels are driest the last week in June since 2012. Midday weather added rains for parts of central and east Midwest beyond Monday. Amounts could be .25-1.50 inches. Yesterday, soybeans rallied on hope that it was time for China to begin to buy US soybeans to restock reserves. USDA rated the US soybean crop 65 pct G/E vs 69 expected and 70 last week. Initial SU resistance is near 15.00 with key overhead resistance near 15.25.

CORN

Corn futures ended higher. US end users are trying to buy nearby corn at higher than normal basis levels. USDA NASS acreage and stocks report this week adds to volatility with commercials net short the July and trying to manage risk. Some grain analyst are suggesting farmers to add to old crop sales before the report, month and quarter end and US summer weather pattern. CN-CU spread is near +100 cents. Strong basis has C IL flat price corn bid near 8.20. Some note that current US central Midwest soil moisture levels are driest the last week in June since 2012. Midday weather added rains for parts of central and east Midwest beyond Monday. Amounts could be .25-1.50 inches. Lack of heat could limit the upside in futures. Corn futures have been reluctant follower of higher soybean futures. Some funds have liquidated out of corn longs due to mostly favorable US Midwest weather.  Initial CU resistance is near 6.84 with key overhead resistance near 7.00. Latest weather models have a ridge in the west and moves eastward. Where this ridge settles will be key for Midwest July weather. Normally, a tropical storm is needed to replenish Midwest soils in drier than normal years. There is one moving across north South America heading towards central America. USDA dropped US corn crop to 67 pct G/E vs 69 expected and 70 last week. Lowest rated crop is in MN and OH. Highest is in IA, SD, IL, MO, WI and MI.

WHEAT

Matif wheat futures closed higher. GASC tender tomorrow (Aug[1]Sep-Oct). Algerian tender was raised to 740kt from 660kt at a price of $445. Russia will change the export tax calculation to reduce the impact of the exchange rate. If Russia cannot forward price wheat, it may not do any GASC this season.  There were reports of a Russian export default of 150-600kt, on contracts that were up to $130 below the market. Russian farmer defaults are also said to be growing. Poland’s Ag Min said the EU’s aim to move 20 mmt of grain out of Ukraine by end July was simply unfeasible and amounted to political posturing. Ukraine war escalation with bombing in east shopping mall added to war uncertainty to Black Sea wheat exports. Talk that most World wheat buyers are short and need to buy wheat offers support. Most look for lower US 2022 spring wheat acres and June 1 stocks from USDA this week. Most of this may be factored in lower prices. WU still not over Mondays high. Wheat futures have dropped on new crop US winter wheat crop harvest, improved US/Canada spring wheat conditions and early start to EU harvest. Parts of Ukraine and SW Russia remains dry.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2021 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started