Month end trade didn't disappoint as the USDA brought us lower than expected acres and stocks in beans and corn. Dec corn was limit up and July up 25 1/2 to 720. Beans rock for 90 1/4 to 1450, and meal up $27. Domestic meal end users who didn't book the rest of their needs below 350 are going to regret it I believe. Rice a nothing report punt, 1317 1/2, off 7 1/2. Wheat up 31 3/4 to 671 1/2 and I don't know if that's corn sympathy or weather, probably a bit of both. Dow pops 229 to 34,399 and bonds gain 21 tics, 160.24.
Tuesday trade all about liquidation of July positions and squaring up before the Wednesday USDA numbers. July corn shorts taking a hit as cash is firm and they don't have inventory to deliver, 19 cent pop to the good with a 694 1/2 settle. Dec only up a penny. Rice delivered current as expected and I'd say a good piece of that went to real commercial hands, 1325, plus 9 1/2. Beans up 2 3/4 to 1359 3/4 and bean oil has retaken its bio fuel theme. God forbid if we actually do get tight on meal this summer. We should get a better handle on that at 11. Wheat off 6 1/4 to 639 3/4. Dow up 6 in regular churn trade, 34,170, and the bonds gain a tic, 160.03.
After an ugly Friday trade, Monday put up some solid numbers in the grain room. Just another example of computers needing churn to make their profits. Corn briefly limit up and closes 39 higher, 675 1/2. Dec was up 28 as well. Cash corn is still in demand. Wheat up 9 to 646 and the weather stories for wheat broadly aren't bearish to me. Beans pop for 27 1/4 to 1357 and Nov even stronger. Bean oil getting its mojo back. Rice just stalled as usual after the run-up, 1315 1/2, plus 1/2. Dow had a back and fill Monday, 34,164, off 169. Bonds rally a point and 10 tics to 160.02. Seems like some fear is trumping inflation in that market.
Ugly Friday trade as funds continue to dump longs, other funds continue to add to short positions, and July positions get liquidated. Corn contract lost 51,000 July positions on the day, with July down 16 3/4 to 636 1/2. Will we get Dec corn to a 4 handle pre report? Depends on the weekend weather and just how big this western heat wave develops into. July beans lose over 1/2 total open interest and collapse for 41 1/2 cents, 1329 3/4, again broadcasting that we probably will find more stocks in a few days. Oil got wacked for 300 and this biofuel program requirements seem to have a different bar to cross each day. Supreme court has sided with the fuel industry on exemptions, and that opens the door to less demand. Wheat drops 14 1/4 to 637 and loses 1/3 of July open interest in the process. 1315 rice is off 8 1/2 and the July story there is almost already all played out. Dow firm all day and closes up another 251 points, 34,333. Bonds off a point and 6 tics, 158.24.
More jockeying of positions in front of the big report next week and month end rolling out of July was really the feature for Thursdays trade. Big volume leaving July corn had it down 11 cents, 653 1/4, while Dec bounced 20 from the lows to settle about flat. July wheat dropped a dime and July rice off 11 cents 1323 1/2. In rice, I'd say the short is done being squeezed. Oats popped for another 11 as we look to have set the intern low for the little grain. Beans off 13 3/4 to 1371 1/4 with meal the drag again, even with solid export sales. I don't know where all these beans to crush are coming from, but I'm guessing there will be an "appearance of inventory" in the stocks numbers. Its about the only way I can reconcile what has happened this year in the soy complex. Bonds up 5 tics, 159.30, while the Dow rallies another 323 points to 34,082, nearly 1000 points up from last Friday's ugly close.
Wednesday trade gets a bid in wheat, 10 1/4 higher, 661 1/4. Supportive to old crop corn, 4 1/2 better at 664 1/4.. Brazil crop appears to keep getting smaller as well. New crop corn leaked small as more rain gets factored in, but the northern plains are still deficient. Oats picked up a nickel too and hopefully finding a floor. Beans off 9 1/2 to 1385 as meal continues to look for a bid, but new crop having a harder time dropping from here as we keep selling china more new crop beans in this break. We are selling a bunch of current meal down here at these prices as well. Rice strong again and 19 1/2 higher close, 1334 1/2, but that was 30 off the high as whoever got short pushing the lows appears to have been blown out. Quiet financials with the Dow off 76 in a dead day of trade, 33,759, and bonds off 5 tics, 159.25.
Tuesday trade had old crop corn steady, 659 3/4, plus 1/2, but new crop off 18 as more rain comes into the forecast and the bulls need fed. Wheat off 10 1/2 to 651 and not helping. Meal down $9 as DDG competition and the crush for oil is killing the protein piece of the crush, and beans slip 20 1/2 to 1394 1/2. Rice short getting taken to the cleaners again as we rally 43 more to 1315. July open interest in rice is down to receipts already and the commercial is a net long, or at least was a few days ago. Dow up 74 points, 33,835, and the bonds settle unchanged, 159.30
Friday came out of the box bid, and anyone who sold late Thursday never stood a chance. These systems don't want this game over yet, they make their money on the churn. Meal and oil bid but not silly, beans were just overdone Thursday and we rallied 66 1/4 to 1396. Talk of more China buying in the break for new crop. Rice bear finally got caught and the bull painted the close up on him as well. I would expect the bear to make one last bet to the down side, but he is going to need something from the outside to keep him from writing a check. 1261, plus 38. Corn up 22 1/4 to 655 1/4 and new crop was 33 higher. Wheat gained 23 3/4 to 662 3/4 on a solid wheat day and some bullish spring wheat talk out there on acres. Dow off over 1000 on the week and 538 on the day, 33,155. Bonds gain another point and 7 tics, 160.30. Sunday night should confirm or deny this financial move, and I would not fade Sundays action thru next week.
Exports came out Thursday morning, nothing impressive, but no one noticed anyway. The administration is supposedly going to give relief to anyone who has bio-fuels commitments and that's that. I don't want to editorialize, but what good is a mandate if you drop it as soon as it becomes uncomfortable? The purpose seems to be to me that cost will make people and producers adjust to fulfill the mandate. If I can cry and the mandate goes away, why adjust? With that said, corn limit down 40 cents, 633. Same in new crop. Wheat off 23 3/4 to 639. Rice off only 12 to 1223. Bean oil limit down early and beans lose 118 3/4 to 1329 3/4. Dow off 212 points, 33,693, and bonds gain a point and 29 tics, 159.23. Bloody day all around.
Wednesday trade had some stability in the corn as we moved in a quarter range but closed up 5 1/2 cents, 673. Wheat up 1 1/4 to 662 3/4 and there are some concerns about the early maturity of spring wheat and the risks of poorer yields. Rice up a nickel, 1236, but that's 30 off the highs. I don't have any news on that run up. Bean oil limit down and beans off 17 1/4 cents, 1448 1/2. Oil lead beans up and for now it is dragging them down. Meal does seem to be finding a base. Dow off 272 to 33,905 and bonds leak 23 tics, 157.26.