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Afternoon Market Recap for May 26, 2017

Another bad day for soybeans

May 26, 2017

Corn have better day and week

Soybeans set a new six-week low on Friday ahead of the three-day weekend and were lower for the third straight week as forecasts favor a wet few days for the Midwest, which may have farmers shifting unplanted corn fields to soybeans.

Corn fared better, closing about 5 cents higher as the rain may hurt planted fields or cause the switching to soybeans.

Wheat finished higher and all three classes of wheat closed higher for the week with winter wheat supported by more rain expected in the central Plains.

Trading volume in the crops was light again as traders were anxious to close up shop ahead of the long weekend. The grain markets will be closed on Monday’s holiday.

Forecasts put more rain in the Midwest and Plains this week with severe storms and flash flooding likely on Saturday across the southern half of the Midwest. The latest 6- to 10-day outlook (May 31-June 4) is drier for the northern half of the Midwest but still wet along the Ohio River Valley and for the central and southern Plains. Cool weather is expected most of the eastern half of the country then.

Equities were a little higher, with Dow Jones industrials up about 0.7 point when the crops closed. The dollar was higher and higher for the week while gold also rose and was up $12.6 an ounce. Crude oil was about unchanged.

Exports – USDA, Reuters:

- Japan bought 117,800 metric tons of wheat from the United States and Australia. From the U.S. it bought 23,260 of western white, 21,250 of hard red winter and 35,420 of dark northern spring. The wheat is for loading between June 21 and July 20.

- Jordan retendered to buy 100,000 metric tons of optional-origin milling wheat after passing on offers in a previous tender. The tender closes May 30.

- The Philippines seeks to buy up to 50,000 metric tons of South American soybean meal for October to January shipment.

Corn futures closed higher as the wet forecasts may cause more delays for farmers waiting to plant.  The futures also were higher for the week for the fourth straight week.

The wet forecasts include rain in all or parts of the Midwest through Saturday. USDA will update planting progress on Tuesday due to Monday’s holiday. Last week, it said corn was 84% planted, with replanting needed in Illinois.

The CBOT estimated Friday’s corn volume at 190,434. Thursday’s actual volume was 187,227. Open interest in Thursday’s higher market increased by 7,397 with July’s down 10 and December’s 2,849.

July corn closed up 5 at $3.74-1/4 and new-crop December up 5 at $3.92-1/2.

What to Look For: Talk continues that replanting is needed in Illinois. Crop insurance allows replanting into early June, but there may be the risk of lower yields.

Soybeans posted double-digit losses for the day and lower for the week for the third straight week.

Talk of farmer selling in Brazil coupled with the corn planting problems here weighed on the market. The July contract is the lowest for a lead month since early April and is below key moving averages. It is near oversold territory on technical charts with an RSI of 31.3.

Soybean planting has gone well so far, with 53% done as of Sunday, 1% better than both the five-year average. Planting was ahead of the state average in Iowa, but behind in Illinois and Indiana.

The CBOT estimated Friday’s volume at 169,758. Thursday’s actual volume was 157,112. Thursday’s open interest in the lower market increased by 9,899 with July’s up 6,503 and November’s up 225.

July soybeans closed down 13 at $9.26-1/2 and August down 12 at $9.29-1/2. New-crop November dropped 10 to $9.29-1/4.

What to Look For – Wet weather in the Midwest and the political investigations in Brazil and Washington continue to be watched.   

Winter wheat markets finished higher as the expected weekend storms may add more woes to battered crop there.

SRW wheat finished a few cents higher for the week, while HRW finished a fraction higher.

Spring wheat posted a new three-week high and was higher for the second straight week. Problems with Canadian wheat and the U.S. winter wheat have turned buyers to that market.

Most of the winter wheat has headed and needs dry weather going into next month’s harvest. Weather maps show rain in the central Plains today and Saturday.

CBOT estimated Friday’s SRW wheat volume at 73,068. Thursday’s actual volume was 73,731. Open interest in Thursday’s weak market increased by 4,436 with July’s up 1,595 and September’s up 1,264.

Chicago’s July SRW wheat closed up 7-1/2 at $4.38-1/4 and September up 7 at $4.51-1/4. Kansas City’s July hard red winter wheat rose 6-1/4 to  $4.37-1/2 and September rose 6-1/4 to $4.55-1/4. Spring wheat for July jumped 6-1/2 to $5.68-1/4 and September rose 5-1/2 to $5.73-1/4.

What to Look For – Wheat harvest is under way in Texas and will soon be moving north into Oklahoma where some fields may have been hurt by last week’s rain, hail and high wind.

More from Farm Futures:

Weekly Corn Review
Weekly Soybean Review
Weekly Wheat Review

 

 

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