Grains trading outlook: wheat, corn and soybeans futures gain ahead of the US crops report

All grains futures climbed today, wheat in particular, as rains in the US threatened to lower quality and quantity of winter wheat, as harvesting had begun. The US Department of Agriculture (USDA) will reveal crops progress later today.

Heavy rain and storms hit the Midwest late last week and over the weekend, and a mixed rain pattern dominated over the Southern Plains. Rains can be very damaging to ripe winter wheat, while late planting of spring wheat and soybeans has probably been delayed further.

The USDAs National Agricultural Statistics Service (NASS) will release its report on crops progress and quality for the week through June 15 later today. Last weeks log revealed improved readings for all grains.

Wheat

Wheat futures for July delivery on the Chicago Board of Trade stood at $6.120 per bushel, adding 1.11% at 12:28 GMT today. Daily high and low were at $5.946 and $5.852 per bushel, respectively. The contract lost more than 5% last week, reaching a four-month low at $5.834 per bushel on Friday.

“Rain this late in the growing cycle as we have into the harvest can have a very deleterious effect upon the quality and the weight of the wheat produced,” economist Dennis Gartman said, cited by Bloomberg.

Winter wheat harvesting began in the US last week. By June 8, 9% of crops were collected, slightly less than previous years, while 86% were headed, which is in line with the 5-year average reading for the week. Only 30% of crops were reported in good or very good condition, while 44% were in poor or very poor shape.

Meanwhile, spring wheat planting was 95% complete, and 80% of acreage had emergence. 71% of crops were logged in good or excellent condition, more than readings for previous years.

Corn, soybeans

Corn futures for July traded for $4.486 per bushel, up 0.39%. Prices reached a daily high and low at $4.494 and $4.434 per bushel, respectively. The contract dropped about 2% last week, to reach a four-month low at $4.392 per bushel.

As of June 8, 92% of corn acreage had emerged, slightly more than previous years. Meanwhile, 75% of crops were reported of good or excellent condition, well-above the 63% of the 5-year average.

Meanwhile, soybean futures for July traded for $14.312 per bushel, adding 0.39%. Prices ranged between $14.354 and $14.250 per bushel. Soybeans contracts declined by 2% last week.

As of last week, soybeans planting was nearing completion, with 87% of acreage planted, more than the 81% of the 5-year average. Meanwhile, 71% of crops had emerged, after 50% emergence was reported for the previous week. Also, 74% of crops were reported in good or excellent condition.

Technical view

According to Binary Tribune’s daily analysis, wheat for July delivery on the CBOT will see its first resistance level at $5.925. If breached, the contract will advance to $5.989 and then to $6.035 per bushel. The first support points is estimated at $5.815. Should it be broken, wheat will test $5.769 and after that $5.705 per bushel.

Corn for July will have its first resistance at $4.499 and if it broken the contract will advance first to $4.527 and then to $4.559 per bushel. The first support level is calculated at $4.439. Should the contract breach that, it will probably continue down to $4.407. If both previous supports are penetrated corn will test $4.379 per bushel.

Soybeans for July have the front resistance level estimated at $14.327. If the contract manages to pass the first level, next resistance is expected at $14.399 and then $14.507 per bushel. Meanwhile, support is expected at $14.147, $14.039 and $13.967 per bushel.