Daily comment for Tuesday, September 15

Wheat went from the weakest market on the board overnight to a solid gain by the close. Russian officials keep saying they are open to peace talks, but Ukraine hit another Russian refinery and Zelenskyy said those attacks will continue regardless of President Trump's claim of a truce, so the Black Sea looks more likely to heat up than cool off from here.

More rain is headed for the Corn Belt this week, right as harvest starts to pick up speed.

Outside markets were all about energy again. Crude jumped to a fresh multi month high on damage to a key Saudi pipeline, while the Dow fell to a fresh multi month low as higher energy prices fed inflation worries and pushed the 10 year Treasury yield above 5%, its highest since 2007. The dollar firmed ahead of tomorrow's Fed decision.

Key Points/Developments

Technicals: Dec corn closed right near its high for the day, but still below the 540 to 542 resistance we have been watching. Support is at 526 to 527, the lows of the last two sessions, then Friday's low near 523 and 518, with the 50 day average now up to 493. Above 540 to 542, resistance is Friday's high near 545 and then the contract high just under 550.

Nov beans closed back above the 1310 to 1312 resistance we flagged yesterday, after holding the 1292 to 1294 area for a third straight session. That area remains the key support, with the 20 day average below it near 1282 and then 1250, while 1310 to 1312 should now act as nearby support. Resistance sits at 1333 to 1335, last Thursday's and Friday's highs.

Spreads: The Dec/Mar corn spread narrowed another quarter cent to 14 1/2 cents. The Nov/Jan bean spread widened another half cent to 16 1/2, a new widest for the move.

Weather: TStorm made no changes to its ratings today, leaving corn, soybeans, and winter wheat all at neutral.

TStorm closing comments:

Areas of rain and thunderstorms turn much of the central U.S. wetter over the next four to seven days, except in and near the mid South where the dry heat wave continues. A drier period follows next week as very warm to hot weather continues or redevelops.

In Brazil, another cool front triggers more heavy rain in southern areas this weekend and next week as a very wet September continues.

Markets/Trading Implications

Both corn and beans remain inside their recent ranges, but it was an impressive day overall, especially in soybeans. Beans tried several times over the last few sessions to make a lasting move below 13.00, and each time the funds stepped in to protect it. Now we will see how they handle the top end of that range.

Corn was quieter, but the funds look to be defending their length there too, even with harvest really ramping up. We'd have to think that gets tested at times over the next few weeks as more bushels show up.

China is doing a lot of the heavy lifting. There is talk of some sort of ceremonial cut in tariffs ahead of the September 24 summit, but our guess is that would be largely priced in at this point. Worth remembering the weekend chatter was almost the opposite, with initial meetings between Greer and Chinese officials, some worry about whether Xi would come at all, and friction over Iran, yet today it was nothing but roses.

Call anytime.

Other Notes

• Monday afternoon's Crop Progress report showed corn harvest at 8% complete and soybeans at 6%. Corn's good/excellent rating rose 1% to 57%, while soybeans held steady at 58%.
• NOPA members crushed 205.5 million bushels of soybeans in August. That fell short of the 210 to 211 million the trade was looking for, but was still 8% more than a year ago. Soyoil stocks at the end of August were 1.20 billion pounds, 4% below last year.
• CONAB's first estimate of Brazil's 2026/27 soybean crop came in at 181.6 million metric tons, compared to USDA's 186 million. It also has Brazilian soybean acres growing just 1%, the smallest increase in two decades.
• The Federal Reserve announces its interest rate decision tomorrow, with a quarter point hike widely expected.

Static Notes

• Commitment of Traders data covering positions through Tuesday, September 8, showed funds still adding aggressively to their soybean longs. Corn's net long dipped a slight 6k contracts, leaving them net long a still large 425k contracts. Soybeans' net long grew by 25k to a near record net long of 266k, while wheat net longs declined by 10k contracts, leaving them net long 4k.
• Prices during the corresponding week saw December corn drop 13 cents, November beans lost 2 cents, and December Chicago wheat lost 36 cents. In the five trading days since this report, corn gained 2 1/4 cents, soybeans gained 2 1/2 cents, and Chicago wheat lost 18 1/2 cents.

Have a nice evening!

Clayton and Taylor

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