Overnight trade update:
May23 Corn: -1 at 6.29
May23 Beans: +8 at 14.86
Dec23 Corn: -2 at 5.67
Nov23 Beans: +5 at 13.52
Large speculators hit the panic button following last week’s USDA Ag Outlook meeting. May23 has fallen below 6.36 support yesterday with next inline support at 6.15. If the market can’t hold together 6.15, we do have a gap in the chart at 5.98 back on 7/25/22. US exports aren’t providing any exciting news to help hold support for the time being, but funds are still estimated to be long 177k contracts of corn.
Soybeans have followed corn falling below trends the last few trading sessions. May23 beans have found some support at the 100-day moving average of 14.75. Analysts continue to reduce their crop estimates for Argentina. Some private crop scouts most recent projection is down around 32-33mmt while USDA still sits at 41mmt. 9mmt difference equates to about 330mil bushels of soybeans.
On new crop side of things, it’s early, no reason to panic, but as fertilizer prices have come down considerably in the past 2 months it’s probably wise to take a hard look at protecting 15-20% of your corn in the near future. If you don’t like the idea of outright selling in a downward moving market, we can definitely take a look at some short dated put options to get us down the road into May or June. Currently short dated 5.70 June options which have an expiration of 5/26/2023 (87 days), closed trading around 21-22c cost today. You’d give yourself a 5.70 floor with unlimited upside for the next 3 months. Whatever you’re trying to achieve from a price protection standpoint, we can show you something that can allow you the opportunity.
May23 Corn
May23 Beans
Dec23 Corn
Nov23 Beans
