6.10.22 Market Commentary

This week’s action:

Corn July up 45 @ 7.73

Corn Dec up 30 @ 7.20

Beans July up 48 @ 17.48

Beans Nov up 41 @15.68

KC Wheat July up 44 @ 11.65

Feeders Aug up .525 @ 174.025

Fats June up 2.75 @ 136.00

June Hogs down 2.275 @ 107.90

July Crude down .41 @ 120.41

 

Seasonal Averages:

Dec corn Feb 1 – today: $6.79

Dec corn since Russian invasion: $6.97

Nov beans April 1 – today: $15.05

July KC wheat since Russian invasion: $11.36

 

**We are about 85% through a typical corn seasonal sales time frame with about 30 days remaining.

**We are about 50% through a typical bean seasonal.

 

Recap:

Here’s the quick rundown of the June WASDE: The report overall was neutral with minor changes made to all three commodities. Ending stocks for old crop were raised 45 million for corn, lowered 30 million for beans, and unchanged on wheat from last month’s report. For new crop ending stocks came in 73 million higher than the trade guess on corn, 28 million lower on beans, and 14 million higher on wheat.  The increase in wheat production is surprising given the spring weather we’ve had across the plains and that could change next month as we get more harvested and have a better idea of what’s there. The report was most bullish for beans, but they appear to be lower on a chart-based correction after the last weeks run higher and could see a slightly bigger correction into next week and then potentially resume the rally. 

It is June 10. Late June is typically when we see contract highs barring catastrophic summer weather.

 

Forecast:

5-day forecast is relatively dry with hot/humid conditions for most of the corn belt. Welcome to summer!

Outside Markets:

The national gas average keeps making all time highs. It is up 23 cents/gallon this week at $4.99 (Nebraska $4.68) and the diesel average is $5.75. Inflation continues to be a lead story as the Consumer Price Index released this morning hit 8.6% in May, which is the highest level since 1981. This will likely force the Fed to keep raising rates, even as the economy cools down. The stock market reacted negatively to this news with the major indices all down 2-3% this morning and being down over 5% for the week. July crude peaked at $123/barrel this week while July lumber slumped to contract lows at $550. It peaked in early March above $1,200. The commodity basket may be losing its sex appeal with investors as almost $1 billion left exchange traded funds in May. This is the largest exodus of cash in more than two years.

The US Supreme Court is close to announcing whether it will hear Bayer’s appeal of a case in which they were held liable for $25 million in damages to a man who blamed his cancer from exposure to Roundup. This decision could determine if thousands more cases can proceed.