May 13, 2025
At this hour:
🌽Corn market is down 3-4c,
🌱soybeans are down 5-6c,
🍞wheat is down 4-6c,
🛢️crude oil is up 40-42c,
💲US Dollar is down 15-16 points.
-USDA projects the corn yield to be 181 bushels per acre and the soybean yield at 52.5 bushels per acre.
-Carryout projections for next marketing year were both tighter than trade expected at 1.8 billion corn bushels and 295 million soybean bushels.
-Planting progress saw corn at 62% planted vs 5-year average of 56% and soybeans are 48% planted vs 37% 5-year average.
-Weather looks to cool down for the upper mid-west and bring in some moisture and potential frost this weekend into early next week.
-Weekly export sales on all 3 commodities were within their range but at the low end. Corn continues to run well ahead of the pace needed to achieve USDA annual export number.
🐂🐻Today feels like a turnaround Tuesday type action.
Support/Resistance:
July corn – Support on July corn is at $4.42 1/4 which is the low from May 8th. Resistance is at $4.61 1/4 which is the 200-day moving average.
December corn – Support comes in at $4.35 3/4 which is the May 8th low. Resistance comes in at $4.48 1/2 which is the 200-day moving average.
July soybeans – Support comes in at $10.44 1/2 which is the 100-day moving average. Resistance is at $10.81 3/4 which is the high from February 21st.
November soybeans – Support is at $10.34 1/4 which is the 200-day moving average. Resistance is at $10.64 1/2 which is the high from February 21st.
July Kansas City wheat – Initial support is at $5.06 1/4 which is the contract low. Resistance comes in at $5.40 1/4 which is the 20-day moving average.
Where do we go from Here:
The USDA increased demand for corn this upcoming year giving us a tighter than expected carryout projection for the 2025/26 marketing year. Keep in mind this is using a national yield of 181 bushels per acre too. December corn futures trading below $4.50, sure does not feel like we have much if any weather premium built into this market. Global ending stocks also dropping 10 million metric tons for next marketing year is a shock to myself as well. What happens if we get some adverse weather in the U.S. this summer? All it takes is a 178 bushel per acres yield and we have a carryout in the U.S. at 1.5 billion bushels. Funds are holding a fairly neutral position so they could go either way. The crop is getting planted early this year and under good conditions, but we had good conditions all last year and had a record yield of 179.3. It feels like to me, we are going to need to add some weather premium to this market sometime before summer weather hits.
Soybean carryout projected at 295 million bushels was a surprise to the market and November soybeans closed up 27c yesterday. We all know the soybeans are made in August. Just take 2 bushel per acre off the yield, and carryout in the U.S. is down to 130 million bushels, or the pipeline. World stocks are plentiful but here in the U.S., a little adverse weather and things could get really tight. This suggests to me that soybeans should stay supported until we know more about the summer weather.
Wheat production number came in bigger than expected. Not a total surprise considering how conditions have rebounded and still looking to get better. We saw weekly crop ratings for the wheat crop gain 3% in the “good/excellent” category this week as well. Funds are holding a record short position in the Kansas City wheat complex and continuing to add to that short position. Wheat is really oversold but the trend is still down.
Upcoming USDA Reports:
May 19, 2025 – Weekly Crop Progress
May 23, 2025 – Cattle on Feed
Are you new here? Click here to subscribe and receive the newsletter in your inbox.
We’re here to help. Call any of our hedging strategists at 844-4AG-MRKT.
