Futures Commentary – June 21st, 2012

 

The macro markets fell sharply this week as the Fed’s remarks and downgrades to some European debt ratings were causes for concern.  The Dow is down 193.40 so far this week to end trade Thursday at 12,573.57.  Oil has fallen sharply as demand concerns have driven the market down $6.04 a barrel to trade near $77.96 as of this writing.  Gold continues to lose favor as a safe-haven asset losing another $61 an ounce to settle at $1,565.70 today.  The dollar index has rising sharply as several European banks received downgrades to their credit ratings.  Agricultural commodities have rallied in the face of the macro market selloff.

Corn has gained 6 ¼ cents on the July contract to settle at $5.89 ½ Thursday.  The market benefited from hot temperatures early in the week that drove prices to the highest level in nearly a month.  Some rains have come later in the week to take some of the weather premium back out of the market.  Conditions for crops in Illinois and Indiana once again showed large declines in the good-to-excellent ratings.  Export sales continue to disappoint and were reported as 171,400 MT, which is up 86% from last week.

Soybeans have rallied sharply this week tacking on 59 ¼ cents to the July contact ending trade at $14.39 today.  As with corn, the conditions ratings for soybeans showed significant declines in the good-to-excellent ratings across several of the key growing states.  Technically the chart landscape has begun to look much better after moving through some resistance areas.  Export sales continue to run ahead of pace and were reported as 163,800 MT, which was a marketing year low.

Wheat ran up 47 ½ cents to settle at $6.60 on the July CBOT contract Thursday.  Harvest pressure is starting to subside as the key growing states of Oklahoma and Kansas are nearly completed with harvest.  Productions concerns for the Black Sea region and Europe have given a reason for buyers to enter the market.  Export sales added to the bullishness and were reported as 842,000 MT, which is up 94.5% from a week ago.

Bearish fundamental news has driven the outside macro markets lower this week, but the commodity markets have rallied in the face of this selloff.  Weather and condition ratings have been a key driving force for the agricultural markets and will continue to be a major factor for the weeks to come.  The end of the month will bring us the USDA’s Quarterly Grain Stocks and Planted Acreage reports adding to an already volatile month of trade.

The macro markets fell sharply this week as the Fed’s remarks and downgrades
to some European debt ratings were causes for concern. The Dow is down 193.40 so far
this week to end trade Thursday at 12,573.57. Oil has fallen sharply as demand concerns
have driven the market down $6.04 a barrel to trade near $77.96 as of this writing. Gold
continues to lose favor as a safe-haven asset losing another $61 an ounce to settle at
$1,565.70 today. The dollar index has rising sharply as several European banks received
downgrades to their credit ratings. Agricultural commodities have rallied in the face of
the macro market selloff.
Corn has gained 6 ¼ cents on the July contract to settle at $5.89 ½ Thursday. The
market benefited from hot temperatures early in the week that drove prices to the highest
level in nearly a month. Some rains have come later in the week to take some of the
weather premium back out of the market. Conditions for crops in Illinois and Indiana
once again showed large declines in the good-to-excellent ratings. Export sales continue
to disappoint and were reported as 171,400 MT, which is up 86% from last week.
Soybeans have rallied sharply this week tacking on 59 ¼ cents to the July contact
ending trade at $14.39 today. As with corn, the conditions ratings for soybeans showed
significant declines in the good-to-excellent ratings across several of the key growing
states. Technically the chart landscape has begun to look much better after moving
through some resistance areas. Export sales continue to run ahead of pace and were
reported as 163,800 MT, which was a marketing year low.
Wheat ran up 47 ½ cents to settle at $6.60 on the July CBOT contract Thursday.
Harvest pressure is starting to subside as the key growing states of Oklahoma and Kansas
are nearly completed with harvest. Productions concerns for the Black Sea region and
Europe have given a reason for buyers to enter the market. Export sales added to the
bullishness and were reported as 842,000 MT, which is up 94.5% from a week ago.
Bearish fundamental news has driven the outside macro markets lower this week,
but the commodity markets have rallied in the face of this selloff. Weather and condition
ratings have been a key driving force for the agricultural markets and will continue to be
a major factor for the weeks to come. The end of the month will bring us the USDA’s
Quarterly Grain Stocks and Planted Acreage reports adding to an already volatile month
of trade.