Grain prices end the day under pressure | Friday, July 1, 2022

Grain prices in the US closed the day on Friday lower. September corn was down 9 cents and December corn was down 12 ¼ cents. August soybean futures were down 50 ¾ cents and November futures were down 62 ¾ cents. September Chicago wheat closed down 37 ½ cents. Kansas City September wheat closed down 37 ¾ cents, and Minneapolis September wheat closed down 42 cents.

Livestock prices closed the day higher. Live cattle futures ended the day up $2.02 on the August contract. August feeder cattle closed up 90 cents. July lean hog futures closed the day 47 cents higher.

Crude oil rose $2.44 and Dow Jones futures rose 322 points.

Another tough week of trading for US grain prices. Bottoms selling was the main theme this week and continued throughout the week. A mix of recession talk and end-of-month and end-of-quarter talk added to the reasons why funds liquidated so many contracts this week.

The weather is calling for rain in Iowa and Illinois over the long holiday weekend. If the shower fails to materialize or underperform, we are likely to see a trade higher on Tuesday. The weather forecast for the next 10 days appears to be non-threatening, but from July 10-20 there are some models that speak of a hotter and drier pattern. We are very interested in a weather market, so look for the direction of trade next week based on the latest weather charts.

Cattle markets had a good week’s close with higher spot prices for both live cattle and lean hogs pushing prices higher at the end of the week. Seasonally speaking, we typically see lean hogs selling for a few weeks and live cattle going up a bit more. The cattle markets of the last two weeks seem to be taking some of their direction through the stock markets.

Grain markets will be closed Monday in observance of the July 4 holiday. Trading will resume at 8:30am CT on Tuesday morning. Have a happy and safe 4th of July!

More sale in grain markets: 10:45 am

By noon, September corn futures were down 6 cents to 7 cents and December corn futures were down 10 cents to 11 cents. August soybean futures are down 45-46 cents and November futures are down 57-58 cents. September Chicago wheat is 28 cents lower. September Kansas City wheat is 40 cents lower, and September Minneapolis wheat is 39 cents lower.

Cattle prices are higher with live cattle up to $2.77. Feeder cattle cost $1.37 more. Lean hogs were up 87 cents per hundred. Livestock markets are on fire. The rope cash market is helping keep cattle alive. Livestock supplies appear to be tight as we head into the fall period, and this should help support prices going forward. Feeder cattle are receiving good support from the corn market which is under pressure.

Crude oil was up $2.29 this morning and Dow Jones futures were down 103 points.

More fund sales is today’s topic. After a neutral to friendly vintage report yesterday, the funds have been in sell-off mode. Some of the selling is due to month-end and quarter-end as the fund closes positions to balance everything out.

Weather forecasts call for rain in the Midwest over the three-day weekend and that appears to help put further pressure on the corn and bean markets. Temperatures remain highly seasonal. Once we get past the 4th of July holiday, the market will pay particular attention to weather charts and temperatures as we begin to see parts of the US heading into crucial pollination season.

Grain prices mostly down this morning: 8:45 am

September corn futures are 1 to 2 cents lower. August soybean futures are 23-24 cents lower. September Chicago wheat is 2 cents higher. Kansas City September wheat futures are 3 cents lower, and Minneapolis September wheat futures are 5 cents lower.

Livestock prices are higher this morning. Live cattle is $2.57 higher. Feeder cattle cost $1.05 more. Lean hog futures are 72 cents higher.

Crude oil is up $2.25 this morning, and the stock market is down 63 points to start today’s trade.

Choppy action in grain markets for Friday after the USDA released its acreage report and quarterly grain stocks report yesterday. Overall, the report was neutral to friendly on soybeans, but traders did not trade it that way. Today’s weather is not threatening, but we will need some moisture soon in some areas.

Open interest continues to fall in commodities as the investor is content to take the money and stay on the sidelines. It looks like it will take a major weather event this summer for outside money to get back into grain prices. Until that happens, it looks like rallies will likely be difficult to sustain.

In cattle markets, live cattle continue to struggle between recession fears and favorable fundamentals. Cash is moving higher, especially in the north, but we lack the outside investor to push futures higher. Feeder cattle is rising mainly due to lower corn prices in the last two weeks.

Look for choppy trading today as traders take off early ahead of a three-day weekend.

For a free trial of The Kluis Report, which includes market updates three times a day and the Saturday newsletter, visit kluiscommodities.comcall 888-345-2855 or email info@kluiscommodityadvisors.com.

About the Author: Cory Bratland is the youngest of five children who grew up on his family’s farm near Willow Lake, South Dakota. Bratland attended Willow Lake High School and graduated with an AAS degree in agricultural business administration from Lake Area Technical Institute in Watertown, South Dakota. He began his career as a cash grain marketer and grain merchant with Cargill, Inc. While working for Cargill, Inc., Bratland held various marketing positions in South Dakota and Minnesota. In 2003, he was licensed as a Series 3 and 30 commodity broker. In 2008, Bratland left Cargill to become an independent commodity broker and started Prairie Ag Marketing Services. In 2009, he partnered with Al Kluis as an affiliate office. In 2010, he became Kluis Raw Material Advisors‘Chief Grain Strategist. In addition to working daily with Al on marketing strategies, Bratland also serves private clients through Kluis Publishing and Prairie Ag Marketing. He lives near Willow Lake, South Dakota with his wife Erica and his children Hunter, Elliot and Isabella. He is still actively involved in the family farm that grows corn, soybeans, alfalfa and also has a farm with cows and calves.

Publisher’s note: The risk of loss in futures and/or options trading is substantial, and each investor and/or trader should consider whether it is a suitable investment. Past performance, whether actual or indicated by simulated historical testing of strategies, is not indicative of future results. Trading advice reflects good faith judgment at a point in time and is subject to change without notice. There is no guarantee that the advice given will result in profitable trades.

Leave a Reply

Your email address will not be published.