CNS Canada — The future looks hot and dusty for corn and soybeans in the U.S. Midwest and central Plains over the next week or so.
While crops in the U.S. are generally off to a good start so far this year, the heat could still bring some much-needed support to both commodities.
The July corn contract on the Chicago Board of Trade was at $4.12 per bushel as recently as May 24 (all figures US$). By Monday, it closed at $3.67.
The news wasn’t any better for soybeans. Its July contract touched $10.41 on May 25, but on Wednesday closed at $9.36.
“This thing is falling pretty hard and I’m sure we are oversold,” said Jack Scoville of Price Futures Group in Chicago. “We need something to get people interested in buying it again.”
He pegs support for corn at $3.66 per bushel, with the next rung below that at US$3.62.
“If we can get above $3.80 then we have a chance to make corn bulls feel better about life,” he said.
Support for soybeans came in at $9.35, but Scoville said there is a chance futures could dip below $9.
The possibility that more tariffs could be imposed by the U.S. on China as early as Friday kept a bearish clamp on trade action.
“If one (trade penalty is imposed) then the other happens,” Scoville said. “But if we do it, then they are likely to retaliate, which would affect soybeans.”
— Dave Sims writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.