Ag Futures Resume Their Trend Lower

July corn completed its move back to the old high of 392 and abruptly turned lower. It is now trading in the congestion area of 373 with support is 363. Stochastics point to lower values. Look for the market to test support. Downside risk is to 350 then 340.

Dec corn met our objective of trading over 405 and is now pointing lower. Support is 390, 386, 382. There is downside risk to 375. Producers that have sales on the books should target the old contract high, 420, as a target to advance sales. If you do not yet have sales on the books target 390 then 395.

July soybeans turned lower last week after running right up to the old support value of 994. Last Friday I feared that the market would trade higher on the weather forecast thereby trapping bears that have been shorting this market. Today that seems not to be the case as soybeans continue to trend lower. Producers should sell old crop soybeans on any market strength.

Nov soybeans have continued their trend lower after trading nearly 950 last week. We have encouraged our clients to sell Nov soybeans for weeks, therefore, producers that have adequate coverage could wait for weather volatility to advance pricing. Producers that need coverage should pick a day and sell something. Downside risk is to 870.

July wheat is begining to trade in a somewhat higher range based on disappointing yields coming from several parts of the country. Any bullishness is of course tempered by the massive supply carryover from previous crops. My bias is to wait until the crop is harvested and sell it off the combine. Farmers with on farm storage may consider storing for the market carry. Farmers without on farm storage are certain to be disappointed with storage rates due to the aforementioned futures carry and be forced to sell at harvest time.