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Ag Market View for June 8.23


The soybean complex was mixed with beans up $.02 – $.10 led higher by new crop into the close.  Soybean meal was down $1 – $2 while soybean oil surged 130 – 200 higher.  July/Nov spread reached a new high today at $1.95 before correcting, closing at $1.75, down $.07 ½.  July-23 bean oil surged above its 50 day MA recording its highest close in nearly 1 month.  Old crop export sales at 8 mil. bu. were supportive.  YTD commitments at 1.880 bil. are down 15% from YA, vs. the USDA forecast of down 7%.  Soybean meal sales did back off their recent torrid pace, at 178k tons were down 56% from LW and the lowest in 6 weeks.  YTD commitments are still up 3% from YA, vs. the USDA forecast of up 2%.  Spot board crush margins surged $.17 today to $1.03, its highest level in 3 weeks.  Bean oil product value reached 39.5%, a 5 month high.  The US soybean area in drought advanced 19% the past 2 weeks to 39%, highest since Jan-23.  The BAGE reports Argentina harvest at 94% complete, vs. 99% YA.


Prices closed $.02 – $.06 higher led by strength in spot July-23.  Today’s rebound stopped just shy of this week’s high of $6.14.  Next resistance is the 100 day MA at $6.23 ½.  Dec-23 rebounded to close on its highs with the drier midday forecast.  Lower rainfall totals from the midday GFS weather model fueled the late day price strength.  Shortly after tomorrow’s USDA report the markets attention will refocus back to weather heading into the weekend.  Today’s updated Drought Monitor did show a deepening of drought conditions from Central IL eastward into IN, OH, and much of Central KY.  The GFS model lowered expected rain across eastern NE, much of IA and from Central IL into Northern IN, areas in most need of moisture ASAP.  No extended periods of extreme heat are forecast for the next 10 days. Old crop exports at 7 mil. bu. brought YTD commitments to 1.509 bil. bu. down 36% from YA, vs. the USDA forecast of down 28%.  US corn area in drought has shot up 20% in 2 weeks, up to 45% the highest since Jan-23.  Still well below last year’s peak of 71% in Nov-22.  The BAGE reports Argentine harvest has reached 33%, just below YA pace of 34%, however well below the 5-year Ave. of 44%. 


Prices were higher across the board recovering part of yesterday’s losses in Chicago and KC, while MGEX has recovered all of yesterday’s losses.  Chicago closed $.09 – $.11 higher, MGEX was up $.20 – $.22, while KC was $.16 – $.19 higher.  While the total winter wheat area in drought increased 1% to 47% last week, the area in exceptional drought (D4 the most severe) slipped to 4%, down from 12% and the lowest since Aug-22.  My est. for WW production is 1.176 bil. bu. with an average yield of 46.5 bpa, this is up 46 mil. from the May-23 USDA forecast of 1.130 bil.  No update yet on Algeria’s tender for 140k mt of optional origin feed wheat.  Japan purchased a total of 87k mt of milling wheat with 32k coming from Australia and 55k from Canada.  Tunisia has tendered for 100k mt of milling wheat in a tender to close tomorrow June 9th.  Without getting crop specific, Ukraine’s Ag. Minister did acknowledge they would likely lose several mil. mt of grain and agricultural production due to the breaching of the Kakhovka dam.  The BAGE reports Argentine wheat plantings at 19.5% well below the 30% from YA.

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