July Wheat - Steady
Dec Corn - 8 to 10 Higher
Nov Beans - 5 to 10 Higher
In my experience, during market conditions that approach our current situation, one cannot separate technical analysis form weather and crop ratings - they are inextricably intertwined.
Worded a different way, the price action is telling us that we could only be seeing the tip of the iceberg at this juncture - there could be real trouble with the crops up ahead.
I heard that crop conditions for both corn and soybeans were lower than expected this afternoon. The good/excellent categories in corn fell 6 percentage points from last week and 5 points down in soybeans. These numbers were in the face of IN & OH actually improving.
As reported by the USDA (NASS division) , 5 states were double digit declines in corn and soybeans, including the biggest producing states like IA, WI, IL, and the Dakotas.
Here are some maps from USDA that I found on Agtalk, a public forum for farmers, apparently from twitter. They show the total good and excellent for each state and the weekly decline. It also shows this years total G/E number compared to last year. These are great visuals. Corn is the top map and beans below.
Today was a correction day for both December corn and November soybeans. The rally began on June 1st, it is now 13 days old and I have identified 3 corrective days, including today.
It appears that 1 day is all we will get for corrections during this powerful rally. There may be another gap up tonight which does not get filled, but anything can happen. The pattern in November Soybeans since June 8th has been 2 days up, 1 day correction, 1 day up -1 day correct, then 2 days up - 1 day correct - this is today.
The corn pattern is identical except for 1 correction day closing at a net gain for the day. Therefore, the next action should be 1 or 2 days up then another 1 day correction in both corn and Soybeans. Here's the current December corn chart.
Check out today's November bean chart.
Our current corn and bean markets seem even stronger than 2012 so far because the corrections are shallower/not as much backfill, so honestly I don't quite know what to expect. This market has exceeded my most aggressive expectations.
It is reasonable to be prepared for tests of the 2022 price highs, given what we know and depending on the weather over the next 3-4 weeks. If we can get a gap up that's not quickly filled, then upside projections can start to be made. Stay tuned.
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