Monday AM Update

Monday June 13, 2022 5:10 AM CST

MORNING MARKET COMMENTS BY: Al Kluis

Good morning. This is Kluis Commodity Advisors with your opening grain comments for Monday June 13, 2022. 

The hot weather in the extended forecast is positive for prices, but the meltdown in the global stock market is viewed as negative, especially for soybeans.  

On Friday, the grain markets closed mixed after a confusing USDA report. Corn closed unchanged to 3 cents higher,  soybean futures were to 14 to 23 cents lower, and wheat closed 2 cents lower to 8 cents higher. 

In the US Globex grain markets at this hour, corn futures are 1 cent higher; soybean futures are down 19 cents, and wheat futures are trading 9 to 10 cents higher.   

On the Dalian Commodity Exchange in China corn futures are 1 cent higher at $11.10, and soybean futures are 2 cents lower at $26.10. On the Matif exchange in Europe wheat futures are 14 cents a bushel higher at $13.05

TO DO:   Review our price targets and where you should be.   

WHAT WE’RE THINKING:  The corn crop rating in today’s USDA Crop Progress report will come in today at 1 to 2% above the 70% good to excellent that was reported last week. With the hot weather forecasts, that could be the highest rating of the year. For soybeans the initial rating should come in at about 72% good to excellent. 

WHAT TO WATCH:   I am watching the US and global stock markets. For the Dow, the key level of support is the low from May 20 at 30,935; for the S&P 500 it is 3,807. Closing below support and at new lows for the year would be viewed as negative for the stock market and the entire commodity complex. A recession results in reduced demand. 

THE MARKETS

Overnight Markets

July Corn:  The trading range is 12 cents; the last trade shows corn up 1 cent at $7.74. 

July Soybeans:  The trading range is 35 cents; the last trade shows soybeans down 19 cents at $17.26.

Wheat: Chicago wheat is up 9 cents, KC wheat futures are up 9 cents, and Minneapolis wheat is up 10 cents.

Global Stock Markets: The stock market in China is down 0.9%. Japan is down 3%, European stocks are down 2.1%.  

Outside Markets: The US Dollar Index is up 0.62 0.23 points at 104.57, crude oil is down $2.13 per barrel at $118.56, S&P futures are down 90 points at 3,809, Dow futures are down 584 points at 30,808 and gold futures are down $17 per ounce at $1,854.

Livestock Futures:  In the livestock markets on Friday, June Hogs closed up 82 cents at $107.80, June Cattle closed down 85 cents at $136.20 and August Feeders closed down $1.55 at $174.77.

TODAY’S CHART:   Corn 

 This is the weekly CBOT July 2022 Weekly Corn chart. You can see the major low in April 2021 at $3.90. From that low, corn rallied to the high in May 2021 at $6.37. Prices then pulled back to the harvest low at $5.13. From that low, prices rallied for seven months to the high in April at $8.13. May was an inside month.  Now the chart shows a potential low and double bottom with the low in April at $7.22 and the low last week at $7.20. That is now key support. Resistance is at last week’s high at $7.82 and then at the contract high at $8.13. 

[Chart source: DTN/ProphetX]