Don’t miss the latest market commentary from the Farm Futures team. Sign up for the complimentary morning and afternoon market newsletters!
Prices updated as of 6:55 a.m. CDT.
What we’re watching
Corn and soybean futures slumped overnight after crude oil prices tumbled and Midwest weather forecasts suggested August will bring some moderation from extreme heat, along with better chances for rainfall. Does this mean the July rally is kaput, or is there more upside?
Corn tumbles as weather turns less threatening
December corn futures fell 14 cents to $4.7350 per bushel late in overnight trading after ending unchanged Friday at $4.8750. Earlier Friday, December futures reached $4.92, the contract’s highest intraday price since May 21. Futures still gained 20 cents to post a third straight weekly gain. September corn fell 13.25 cents to $4.51.
Corn technicals took a sharp bearish turn overnight with December futures dropping back below the 10- and 100-day simple moving averages (both about $4.74). A weak close today would likely fuel ideas that the market established a near-term peak at Friday’s high. Near-term support is seen at the partially filled gap from a week ago, marked by the July 17 high around $4.68.
Barchart’s front-month national average cash corn price rose about 0.25 cent Friday to just over $4.3375, down from a two-month high Thursday but still up over 20.75 cents for the week. Friday’s average was about 30.5 cents below September futures, narrowing from 31.75 cents a week earlier.
Corn futures slumped overnight behind a combination of easing concerns over war and weather. Crude oil futures tumbled over 6% after the U.S. and Iran paused strikes over the weekend, raising hopes of a diplomatic solution that would de-escalate the conflict and allow shipping to
September WTI crude futures fell 6.8% to $83.24 per barrel after rising over 9% last week. On Thursday, Brent crude, the global benchmark, briefly surpassed $102 and hit a two-month high.
Perhaps the larger bearish influence today is a perceived shift in the weather outlook toward something a little more crop friendly over the next two weeks, with weekend updates suggesting widespread Midwest rain coverage this week and some moderation in heat.
Most of the Midwest should receive rainfall coverage this week, with Iowa and northern Illinois in line for 0.75 inch to as much as 2 inches by Saturday, based on a National Weather Service five-day outlook. Nebraska and the Dakotas may receive 0.25 inch to 1 inch, with similar amounts possible for the eastern Corn Belt.
Extended forecasts indicate the first half of August will be warm but also bring stronger moisture prospects. The latest NWS 6-to-10-day outlook, covering August 1-5, shows above-normal temperatures covering the entire Corn Belt, but also near-normal precipitation probabilities outside of the western Belt.
Meantime, traders may be looking for some deterioration in USDA’s weekly crop ratings later today. A week ago, USDA reported 67% of the crop in 18 top corn states in either “good” or “excellent” condition as of July 19, down from 68% a week earlier and down from 74% a year earlier. Another 24% of the crop was rated “fair” while the combined “poor” and “very poor” number rose to 9% from 8%.
USDA also said 59% of the crop was silking as of July 19, up from 34% a week earlier and above the 54% five-year average. About 13% of the crop had reached dough stage, slightly ahead of the five-year average.
Soybeans slump to one-week low
November soybeans plunged 35 cents to $12.1850 late overnight after earlier dropping to $12.15, the contract’s lowest intraday price since July 20. Futures gained 9.75 cents Friday to $12.5350, the contract’s fifth gain in the past six days and the highest close for a new-crop contract since December 2023. August soybeans fell 32.75 cents to $12.1525.
Soybean technicals weakened overnight after last week’s rally, which sent November futures up over 50 cents to record a third straight weekly advance. A weak close today would lead to beliefs that the market hit a near-term peak at Friday’s high at $12.5650. November futures overnight pushed under the 10-day SMA ($12.19) and could be heading for a test of near-term support at last week’s chart gap (between the July 17 high at $12.04 and the July 20 low at $12.0750).
Barchart’s front-month national average cash soybean price rose almost 10 cents Friday to just under $12.14, up 48 cents for the week and the highest since January 2024. Friday’s average was about 34 cents below August futures, narrowing from 38.75 cents a week earlier.
December soymeal fell $7.40 to $323.90 per ton. December soyoil fell 157 points to 70.44 cents per pound.
Soybeans joined corn in an overnight selloff driven by the nosedive in energy markets and easing concern over the Midwest weather outlook. Funds scaled up bullish bets in soybean futures much of July and are likely paring back what’s become a sizable net-long. Further fund liquidation is likely if the market can’t rebound from the overnight slide.
This week’s expected rains would be timely for much of the soybean crop, which is nearing its critical pod-setting and pod-filling phase. Temperatures are still expected to trend above normal during the first nine days of August, but precipitation odds have improved.
Meantime, traders will watch today’s weekly USDA crop ratings for signs of deterioration. A week ago, USDA reported 66% of the U.S. soybean crop in good-to-excellent rating as of July 19, up from 65% a week earlier but down from 68% a year earlier (the “excellent” figure rose one percentage point to 12%, while “good” held at 53%). Another 26% of the crop was rated fair, while the poor-to-very-poor figure held at 8%.
USDA also said 32% of the U.S. crop was setting pods as of July 19, up from 19% a week earlier and ahead of the 24% five-year average.
Wheat extends slide on signs of Black Sea improvement
September SRW wheat fell 10.25 cents to $6.6775 after tumbling 18.25 cents Friday to $6.78, down from a three-year closing high Wednesday. Futures fell 4.75 cents for the week to halt a three-week winning streak. Prices are still up almost 79 cents, or 13%, from a four-month intraday low around $5.89 on June 30.
September HRW wheat fell 10.75 cents to $7.3450 after sinking 14.5 cents Friday to $7.4525, down from a three-year intraday high at $7.7750 reached earlier in the day.
September spring wheat fell 13.25 cents to $7.01 after plunging 15.75 cents Friday to $7.1425, the contract’s first drop in nine days. Spring wheat futures are still up 17% from a contract low at $5.9850 posted June 30.
Wheat futures followed corn and soybeans lower overnight, extending Friday’s losses amid easing concern over disruption to grain shipments in the Black Sea. Reports circulated late last week that Russia and Ukraine may be working toward an agreement to avoid attacks on grain-bearing vessels transiting the Black Sea, a key export hub.
Scouts on an annual North Dakota crop tour on Thursday forecast hard red spring wheat yields in the top-producing state to average 48 bpa, down from 49 bpa last year but above the tour’s five-year average of 45.8 bpa, Reuters reported. The Wheat Quality Council tour’s projection was below the U.S. Department of Agriculture’s latest yield forecast for the state of 58 bpa.
USDA spring wheat crop ratings reported early this week dropped sharply and may have further to fall, analysts say. On Monday, USDA reported the spring wheat good-to-excellent rating fell to 53% as of July 19 from 58% a week earlier. Acreage rated poor-to-very-poor increased to 12% from 10%.
A week ago, USDA reported spring wheat’s good-to-excellent rating at 53% as of July 19, down from 58% a week earlier but up from 54% a year earlier. Analysts expected a number closer to 56%. Acreage rated poor-to-very-poor increased to 12% from 10%.
USDA reported 74% of the winter crop was harvested as of July 19, up from 67% a week earlier and above the 71% average for the past five years.