Soybean futures hit new contract highs. Wednesday, June 8, 2022

The corn and soybean markets continued to rally today with soybean futures hitting new contract highs. Several factors are creating this rally. First is the rumor of large corn and soybean sales to China. Second is the large fund buying by investors that are seeking an inflation hedge. Third, end users are buying because of the hot weather forecasts. Wheat futures managed to close higher on a late rally.

July corn had an 18 cent trading range and closed 7 cents higher today at $7.64. December corn closed up 4 cents at $7.18. July soybean futures closed up 12 cents at $17.40, while the November contract closed 18 cents higher at $15.68. Wheat futures closed higher with CBOT wheat closing up 3 cents. KC wheat closed up 6 cents, and Minneapolis wheat is up 7 cents.

No agreement was put together at the meeting with Russia and Turkey to allow a grain corridor from the Black Sea. Ukraine did not even attend the meeting. The failure so far to allow grain exports out of Ukraine was one of the bullish factors for the corn and wheat markets today.

So, I have to ask why buy it when you can steal it? Russian authorities have officially reported on Wednesday they are ready to load grain from Ukrainian ports that are currently occupied by Russian forces – including the heavily damaged Mariupol, and the port of Berdyansk, according to Russian media agency Interfax. A lot of this grain has been stolen from elevators in regions Russia troops control.

In outside markets, the U.S. dollar is trading 20 ticks higher. Crude oil is up another $2.50 per barrel day. The stock market has turned lower with the Dow down 205 points at this hour.

The livestock markets closed mixed on Wednesday. June hogs closed down 50 cents at $107.85. June cattle closed up $3.10 at $136.82, and August feeders closed up $3.20 at $174.45.

The corn market continues to move higher and soybean futures are rallying to new contract highs this morning. We continue to see a lot of fund-buying as rumors continue about large sales being made to China. The weather is going to turn hot starting next week, and no one can predict how long the hot, dry pattern will continue.

At this hour, July corn is up 10 cents. December corn is up 4 cents. July soybean futures are currently up 22 cents. November soybeans are 21 cents higher. Wheat futures are lower, with CBOT wheat down 2 cents. KC wheat is down 2 cents, and Minneapolis wheat is 1 cent lower.

For the week, July corn is up 40 cents. July soybeans are up 54 cents. July CBOT wheat is up 28 cents. July KC wheat is up 26 cents. July Minneapolis wheat is up 6 cents.

On my charts, the bull spreads keep working, which is a positive sign. The market is moving higher and is very orderly. I am watching to see if November soybeans can close above $15.70.

In the livestock market, June hogs are down 17 cents at $108.25. June cattle are up $2.57 at $136.30, and August feeders are up $2.15 at $174.60.

In outside markets, crude oil is up $1.93 per barrel. The U.S. stock market is slightly lower with the Dow down 90 points.

The talks between Russia and Turkey did not bring any results last night, with the two countries blaming each other for the global grain shortage. This is was viewed as positive for the grain markets. Also, the extended forecasts are in agreement that a ridge will likely set up in late June and last into July. This ridge could potentially bring hot, dry conditions in that time period.

After a lower start, grain prices are again higher, with soybeans rallying up to new contract highs. I have several chart patterns that I watch that suggest a potential high by the third week of June.

In the early grain trade after starting out lower July Corn is now up 5 cents. July soybeans are trading 28 cents higher, and wheat futures are 6 to 8 cents higher.

In outside markets, crude oil is now up 60 cents per barrel. The U.S. stock market has turned lower, and livestock futures are mixed.

Author: Al Kluis

Tags: Black Sea, futures, markets, Ukraine, feeders, Russia, corridor, corn, Turkey, grain, soybean, hogs, cattle