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Afternoon Market Recap for June 19, 2019

Grains falter on profit-taking

Corn, soybeans and wheat all take a tumble in Wednesday’s session

Grain prices stumbled today on a round of profit-taking after ticking significantly higher the past four weeks. Expectations for mediocre export sales in tomorrow morning’s USDA report created additional headwinds. Corn and wheat prices slumped around 2% today, with soybean prices down around 1.25%.

The eastern Corn Belt could gather another 1” to 2” of rainfall through Saturday, per the latest 72-hour cumulative precipitation map from NOAA. Areas that could see the largest tallies include Illinois, Indiana and Ohio. Daytime highs will continue to come in slightly below normal across the central U.S. for the rest of this week into the weekend.

With the Federal Reserve signaling future interest rate cuts could be likely later this year, Wall St. continued to haul in gains, with the Dow up 51 points in afternoon trading to 26,516. Energy futures were mixed, with crude oil easing around 0.5% this afternoon, while gasoline and diesel trended moderately higher. The U.S. Dollar eased slightly.

Corn prices slid more than 2% today on a round of technical selling and profit-taking. Prices are still nearly $1 per bushel higher than when they bottomed out in mid-May, however. Today, July futures sank 8.75 cents to $4.41, with September futures down 9.25 cents to $4.4625.

Amid slow farmer sales, corn basis bids were steady to firm Wednesday, rising 2 to 6 cents higher across multiple Midwestern locations today.

Click here to learn more about ongoing basis trends in the latest Basis Outlook column from Farm Futures senior grain market analyst Bryce Knorr.

Ahead of tomorrow morning’s weekly export report from USDA, analysts expect the agency to show corn sales totaling between 11.8 million and 35.4 million bushels for the week ending June 13.

Ethanol production for the week ending June 14 eased slightly from the prior week, with an average daily production of 1.081 million bushels but remains seasonally high. August futures dropped nearly 2.5% this afternoon, to $1.606.

China announced it will keep its anti-dumping and anti-subsidy tariffs on U.S. imports of DDGs for now, although that could change after Presidents Donald Trump and Xi Jinping meet at the G-20 Summit later this month.

And China’s corn production could reach 9.921 billion bushels this year, thanks to a recent round of cool, wet weather. Fall armyworm outbreaks in some key production regions could put yield potential at risk, however.

Grain traveling the nation’s railways continues to come in relatively sluggish, with 22,425 carloads for the week last week (down 3.5% year-over-year). Cumulative totals of 527,403 carloads are down 4.9% from 2018’s pace so far.

Preliminary volume estimates were for 335,045 contracts, falling significantly below Tuesday’s final count of 546,121.

Soybean prices also landed in the red on a round of technical selling and profit-taking today, although losses were less severe than in corn, with a bigger percentage of this year’s U.S. crop still unplanted. July futures fell 10.25 cents to $9.0325 and August futures dropped 10.75 cents to $9.0950.

Soybean basis bids were mostly steady across the central U.S. Wednesday but ticked 2 cents higher at an Indiana processor today.

Ahead of tomorrow morning’s weekly export report from USDA, analysts expect the agency to show soybean sales totaling between 7.3 million and 29.4 million bushels for the week ending June 13.

Analysts also expect USDA to report an additional 100,000 to 400,000 metric tons of soymeal sales last week, plus another 5,000 to 25,000 MT of soyoil sales.

What are you doing with your unplanted acres this year after crop insurance deadlines passed? We’re asking growers about their decisions to plant soybeans or take prevent plant. Click the Feedback From The Field reporting form and give us your firsthand account on this decision, along with how your crops are faring. Or, click here to read the latest farmer anecdotes and view our interactive map.

Preliminary volume estimates were for 237,704 contracts, falling 19% below Tuesday’s final count of 292,296.

Wheat prices took a spill Wednesday on a round of profit-taking that left some contracts 2% lower in the session. July Chicago SRW futures fell 9.25 cents to $5.2225, July Kansas City HRW futures dropped 8.5 cents to $4.5675, and July MGEX spring wheat futures were down 10.75 cents to $5.4050.

Ahead of tomorrow morning’s weekly export report from USDA, analysts expect the agency to show wheat sales totaling between 7.3 million and 18.4 million bushels for the week ending June 13.

Egypt purchased 10.7 million bushels of wheat from Romania and Russia, for delivery in late July.

South Korea purchased 4.4 million bushels of feed wheat from optional origins in a tender today. The grain is for shipment between mid-August and mid-September. The country bought an additional 2.2 million bushels of feed wheat from optional origins in a private deal earlier this week.

China sold 859,000 bushels of its state reserves of wheat at auction earlier today, which was just 0.8% of the total available for sale.

Preliminary volume estimates were for 158,728 CBOT contracts, moving slightly ahead of Tuesday’s final count of 145,184.

grainstable

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