By Kirk Maltais

 

--Corn for December delivery rose 2.8% to $6.74 a bushel on the Chicago Board of Trade Friday as fund traders re-entered positions at a better price following a streak of selling.

--Soybeans for November delivery rose 0.6% to $14.24 1/4 a bushel.

--Wheat for September delivery fell 1.3% to $9.36 1/2 a bushel.

 

HIGHLIGHTS

 

Turning Back: The streak of liquidation of long positions on the CBOT stopped with corn leading the rebound. Doug Bergman of RCM Alternatives projected that managed funds on Thursday were net sellers of 30,000 long corn contracts, in addition to 20,000 long soybean contracts and 10,000 long wheat contracts. Weather outlooks for the U.S. Midwest have turned back toward high heat. Temperatures are forecast at near-to-above normal and rain is expected to be confined to isolated spots, according to DTN.

Buying Opportunity: The upturn in corn was also fueled by fund traders who saw a good opportunity to buy back in, said Donna Hughes of StoneX. "Ee are getting some relief from the recessionary thoughts for the moment," she told the WSJ. "Also, bargain buyers came back in after futures hit technical support in yesterday's session."

Winter Wheat Woes: While corn and soybean futures finished higher in trading, most-active wheat futures closed lower. One factor weighing on wheat is the ongoing winter wheat harvest in the U.S., which is introducing new supply to the market. "The harvest was 25% complete in Tuesday USDA data and were considered within expectations," said Jack Scoville of Price Futures Group in a note. "Futures should form a harvest low earlier in the harvest due to the small crop size." In the USDA's last Crop Progress report, the winter wheat harvest exceeded the 5-year average rate of 22%. However, the condition of the crop remains generally weak.

 

INSIGHTS

 

Back from the Brink: Export sales of U.S. corn rebounded after logging a marketing-year low last week, according to USDA data. In its report for the week ended June 16, the USDA said sales of corn for the 2021/22 marketing year totaled 671,900 metric tons - well up from last week's low sales. Net sales for 2022/23 totaled 358,400 tons. Combined sales across both marketing years for corn fell on the high end of forecasts by traders surveyed by The Wall Street Journal this week - with traders expecting sales to total anywhere from 550,000 tons to 1.05 million tons. Leading buyers of U.S. corn for the week included Mexico, Japan, and Colombia.

Limited Run: Selling was a defining characteristic of commodity markets this week, but the future of that trend may be limited, Capital Economics said in a note. "We don't think there is a great deal of room for prices to fall in the near term for a couple of reasons," said the firm. Energy prices are expected to remain high through the latter half of the year, while physical inventories of commodities such as metals and grains are seen as low globally, supporting prices. Crude oil prices closed up over 3%, which is helping stymie the selling that was seen across the board in commodities yesterday.

On the Rise: The USDA is projecting food prices to surge by nearly 10% this year, driven by the fallout from the war in Ukraine along with increases to interest rates by the Federal Reserve. In a report released Friday, the USDA forecast that all food prices are expected to rise anywhere from 7.5% to 8.5% in 2022 versus last year. Prices for food at home -- food purchased at grocery stores - is expected to rise anywhere from 8.5% to 9.5%. Meanwhile, prices for food away from home - food purchased from restaurants and other similar outlets - are expected to climb 6% to 7%. This year's uptick accelerates a trend seen in recent years.

 

AHEAD:

 

-The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.

-The USDA will release its weekly crop progress report at 4 p.m. ET Monday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

-The USDA will release its quarterly Hogs and Pigs report at 3 p.m. ET Wednesday.

 

Write to Kirk Maltais at kirk.maltais@wsj.com

 

(END) Dow Jones Newswires

June 24, 2022 16:07 ET (20:07 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.