** 6:30 AM CST CBOT Prices: July soybeans are up 2.00 cents at $9.5025, July corn is up 1.25 cents at $3.725 while July Chi wheat is up 2.00 cents at $4.345.
** AgResource AM Grain & Oilseed Comment: Good Morning! Slightly higher has been the overnight CBOT trade with corn, soybeans and wheat holding in the green. The volume of trade has been curtailed by the approaching 3 day holiday weekend and the uncertainty surrounding the June Central US weather pattern.
Wednesday’s CBOT open interest totals reflect a 3,772 contract increase in corn, 4,873 contract bump in soybeans, and 288 increase in wheat. Funds likely continue to add to their already large next short holdings.
Traders will await the weekly US export sales report this AM, but other fresh news is limited. The industry will continue to debate the Central US weather forecast (too wet in the east/improving warm/dry weather west) and the outlook for the remainder of the growing season with funds holding a record large net short CBOT grain/soy position for late May.
With CBOT grain prices at their lowest levels in 6 years and funds heavily short, its unlikely that a new downtrend will be starting until more is known about summer weather and above trend US corn/wheat/soy yields are confirmed.
The coldest/wettest weather appears to have ended for the vast majority of the Central US after today (mostly IN/OH in the next 24 hours). Limited planting progress has been scored this week, but some progress on the weekend and early next week will be seen. ARC estimates that 90% of the US corn crop and 63-65% of the soybean crop will be seeded through Sunday.
The forecast this AM looks improved for seeding next week as a storm system on the weekend takes a more southerly track across AR/MO and S IL. The drier and warmer forecast leans slightly bearish this AM with reduced rainfall totals offered in the 11-15 day period. Early June looks to be starting out better than May, which will be cheered by E Midwest farmers.
In other world ag markets, Sept Paris wheat is up .75 euros/MT at $167.75, with Dalian Sept corn down 2 cents/Bu at $5.95 and Dalian Sept soymeal up $.50/MT at $394.75. Malaysian July palmoil futures closed 21 ringgits higher at at 2,720. May 1-25 palmoil exports were better than expected and up 13%.
OPEC has decided to extend their production cuts for another 9 months which will help support world energy prices on a longer term basis. The news is being greeted by lower crude oil prices with spot July futures down .74/barrel at $50.62. The energy market has long expected that OPEC would hold to their current production cuts.
Not a lot of fresh news this AM. This leaves the market to debate the impact of cool/wet Central US weather on Midwest crops into mid June? Additional heavy rainfall in June is unwanted and would become a more important concern for yield. Heading into a holiday weekend, traders want to wait until Friday’s weather forecast before placing new bets. Next week’s drier and warmer weather trend is likely to cap any rally effort this AM.
