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Weekly Summary & Recommendations 6/12/24

Grain market summary of price outlook, seasonal situation, fundamental & technical analysis with our recommendations for corn, soybeans and wheat (Soft Red Winter, Hard Red Winter & Spring) for past week Wednesday to Tuesday.


Explanation of our approach:



Corn


Corn situation after the close Tuesday, June 11, 2024:


July corn settled yesterday at $4.49½, +7¢.


December corn settled yesterday at $4.65¼, +3¼¢ since last Tuesday.

The past 7 days’ high was $4.71¾, the low was $4.58¼.


Contract high is $5.90 made June 17, 2022;

Contract low is $4.46 made February 26, 2024;

Contract range is $1.44.

Tuesday’s closing price was $1.24¾ below the contract high and 19¼¢ above the contract low.


USDA’s 2023/24 crop carryout in terms of days’ use: US 50, world 94.

USDA’s 2024/25 crop carryout in terms of days’ use: US 52, world 93.


Pricing factors:

  • Seasonal Trend is sideways to up until June 21st, then turns bearish, look at the chart below.

  • Fundamentals are bullish as US domestic and export demand is strong, Brazil’s safrinha acreage down and weather has turned dry two weeks early; Argentine crop down 20% due to Corn Stunt disease.

  • Technical Situation is sideways short-term, up long-term.

  • Price is below the breakeven.


Conclusion:

  • Price remaining 2023 and 2024 corn when and if profitable in June;

  • July corn targets: $5.00 to $5.25;

  • December corn targets: $5.25 to $5.50;

Get it sold by June 21st when the seasonal trend turns down, but only if profitable!



This week's Bullish Consensus:

And the Seasonal Chart reminder:


 

Soybeans


Soybean situation after the close Tuesday, June 11, 2024:


July Soybeans settled yesterday at $11.78, -1¢.


November Soybeans settled yesterday at $11.51½, -4½¢ since last Tuesday.

The past 7 days’ high was $11.72, the low was $11.48¼.


Contract high is $13.51 on November 4, 2022;

Contract low is $11.16¼ on May 31, 2023;

Contract range is $2.34¾.

Tuesday’s closing price was $1.99½ below the contract high and 35¼¢ above the contract low.


USDA’s 2023/24 crop carryout in terms of days’ use: US 30, world 106.

USDA’s 2024/25 crop carryout in terms of days’ use: US 37, world 117.


Pricing factors:

  • Seasonal Trend turns bearish.

  • Fundamentals are bullish as supplies are fairly tight in the USA, Brazil’s crop is about 20 mil less than expected.

  • Technical Situation is sideways.

  • Price is below the breakeven.


Conclusion:

Price remaining 2023 and 2024 soybeans when and if profitable in June or July.


This week's Bullish Consensus:


And the Seasonal Chart reminder:


 

Wheat


Hard Winter Wheat situation after the close Tuesday, June 11, 2024:


July HRW Wheat settled yesterday at $6.55, -32¼¢ since last Tuesday.

The past 7 days’ high was $6.93¾, the low was $6.39½.


Contract high is $10.00 on June 13, 2022;

Contract low is $5.43¼ on March 6, 2024;

Contract range is $4.56¾.

Tuesday’s closing price was $3.45 below the contract high and $1.11¾ above the contract low.


USDA’s 2023/24 total wheat carryout in days’ use: US 137, world 118.

USDA’s 2024/25 total wheat carryout in days’ use: US 147, world 115.


USDA’s 2023/24 HRW wheat carryout in terms of days’ use: US 172.


Pricing factors:

  • The Seasonal Trend is bearish.

  • Fundamentals are bullish as the world has consumed more wheat than it produced in the past four years.

  • Technical Situation is bearish, long-term it may be a down-correction turning higher later.

  • Price is probably below the breakeven.


Conclusion:

You should have already sold

  • old crop ($6.81 July futures),

  • new crop ($6.81 and $7.20 July futures),

  • and up to 100% of 2025 wheat production (July 2025 at $7.20 and $7.45).

If not, wait for the corn rally to carry wheat higher.


 

Spring Wheat situation after the close Tuesday, June 11, 2024:


September HRS Wheat settled yesterday at $6.89¼, -44¢ since last Tuesday.

The past 7 days’ high was $7.39¾, the low was $6.83.


Contract high is $8.71¾ on July 25, 2023;

Contract low is $6.46 on April 3, 2024;

Contract range is $2.25¾.

Tuesday’s closing price was $1.82½ below the contract high and 43¼¢ above the contract low.


USDA’s 2023/24 total wheat carryout in days’ use: US 137, world 118.

USDA’s 2024/25 total wheat carryout in days’ use: US 147, world 115.


USDA’s 2023/24 HRS wheat carryout in terms of days’ use: US 138.


Pricing factors:

  • The Seasonal Trend is bearish, 50% chance the high will be made before June 1st and 95% and chance the high will be made before August 1st.

  • Fundamentals are bullish due to a war in “The Bread Basket of The World”.

  • Technical Situation is bearish, long-term it may be a down-correction turning higher later.

  • Price is above the breakeven.


Conclusion:

You should have already

  • sold old crop,

  • sold 50% of 2024 with a Sept HTA at $7.38 or forward contract

  • placed an order to price 50% at $7.98 on the September HTA 2024.

No recommendation for 2025 HSW currently, but thinking in the $8.65 area.



Soft Red Winter:

You should have already

  • sold old crop ($6.64 July futures),

  • sold new crop (50% at $6.64 and 50% at $7.20),

  • priced 2025 HTA 50% of 2025 SRW wheat at $7.55 and an order to price 50% at $7.98.



This week's Bullish Consensus:


And the Seasonal Chart reminder:


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