DES MOINES, Iowa — On Tuesday, the CME Group’s soybean market shed some losses, but closed lower from fundamental factors such as crop-weather and a technical factor such as the positions of fund investors. At the close, the May corn futures settled 4¾¢ lower at $3.61¾¢, and December futures finished 4¢ lower at $3.86¼. May soybean futures finished 7¼¢ lower at $9.46; November soybean futures ended 5½¢ lower at $9.56¾¢. May wheat futures closed 1½¢ higher at $4.22.
May soy meal futures ended $1.20 per short ton lower at $312.20. May soy oil futures settled 0.66¢ lower at 31.14¢ per pound. In the outside markets, the Brent crude oil market is $0.20 per barrel lower, the U.S. dollar is lower, and the Dow Jones Industrials are 100 points lower. Deanna Hawthorne-Lahre, StatFutures cofounder and trader, says that the ag commodities market seems comfortable going lower.“We have base weakness from the weather not being as prohibitive as had been forecasted,” Hawthorne-Lahre says. “Plus, the structure of the funds, who are long beans and short wheat. To the extent that the U.S. could see lost corn acres could go beans, I would be lightening up as well if I were them.”
She adds, “The whole grain complex feels heavy. I have been neutral wheat since it penetrated the $4.00 level several weeks ago, but see little reason for ownership.” The grain market is expected to remain in a tight trading range, with beans being the most vulnerable to a break, she says. “With the soybean option market’s volalitility hanging around 15%, this thing is very comfortable what it is doing,” Hawthorne-Lahre says. Wheat, corn, and soybean futures closed lower on Monday amid rising estimates for U.S. and global stockpiles.
The U.S. Department of Agriculture last week pegged domestic wheat stockpiles at 1.159 billion bushels, up from a prior forecast of 1.129 billion bushels, and near a 30-year high. World carryout is pegged at 252.3 million metric tons, up from the previous outlook for 250 million tons, according to the USDA. Favorable weather in many of the biggest growing regions has given crops a boost. Russian ending stockpiles of wheat are forecast at almost 12 million metric tons, more than double the prior year, U.S. government data show. Wheat futures for May delivery fell 8¾¢ to $4.21 a bushel on the Chicago Board of Trade. Kansas City wheat lost 11¼¢ to $4.16 a bushel.
U.S. corn inventories are expected to be 2.32 billion bushels, the government said last week, unchanged from a March estimate but well above last year’s 1.74 billion. Brazil’s soybean inventories are projected at 22.6 million tons from 18.1 million a year earlier, according to the USDA. “Grain and soy markets have begun this new week with a bit of hesitancy as we are caught between very ample world supplies and the prospects (risks) associated with producing summer crops in 2017,” said Dan Hueber, the president of The Hueber Report in Sycamore, Illinois. Still, he said he remains optimistic in the short term despite a “few bumps in the road.”
Corn futures declined 4½¢ to $3.66½ a bushel in Chicago. Soybeans closed down 3½¢ to $9.52 a bushel. Soy meal futures lost $4.70 to $312.80 a short ton, and soy oil rose 0.62¢ to 31.81¢ a pound.
agriculture.com