Wheat Leads Price Declines as July Expiration Looms
June 18 2019 - 4:12PM
Dow Jones News
By Kirk Maltais
--Wheat for July delivery fell 1.5% to $5.31 1/2 a bushel on the
Chicago Board of Trade on Tuesday, as positioning ahead of July
options expirations on Friday fed into an already volatile
market.
--Corn for July delivery slid 1.1% to $4.49 3/4 a bushel.
--Soybeans for July delivery rose 0.1% to $9.13 1/2 a
bushel.
HIGHLIGHTS
Extra Volatile: Uncertainty about delayed planting is adding to
the volatility grains futures normally see as the deadline for July
options approaches, Jason Britt of Central State Commodities said.
"Friday is going to be busy for us, depending on where prices are,"
Mr. Britt said. Grains futures in general have been on the rise,
but Mr. Britt says their movement near deadlines tend to go against
prevailing trends.
Take the Money and Run: Grain markets fell despite Monday's crop
report suggesting 6 million-8 million acres of corn may not be
planted this year, possibly reducing corn production by 600
million-800 million bushels. Traders think corn futures have found
a top in the near term, leading to profit-taking. "The lack of a
bullish surprise in the weekly crop progress report added to
overnight pressure," Karl Setzer of AgriVisor said.
Can't Decide: Despite closing practically unchanged, soybean
trading was choppy following President Trump's tweet regarding
resumed communications with Chinese President Xi. "Beans traded
both sides of unchanged multiple times today, starting down on 'buy
the rumor, sell the fact' trading off the crop progress numbers,
but coming back on good Chinese pricing," Charlie Sernatinger of
EDF Man Capital said.
INSIGHT
Numbers Don't Lie: Corn acres in the Midwest, which are normally
100% planted by this time of year, are behind schedule at 92%,
according to USDA data released Monday. The scale of the possible
decline in 2019/20 bushels isn't yet clear. Rain returned to the
Midwest, harming the quality of the plants, and about 59% of
sprouted corn is in good or excellent condition, down from 78% at
this time last year. The rain is also slowing soybean planting
down, with 77% of the acreage sown, down from an average of
93%.
Big in Japan: USTR Robert Lighthizer said negotiations continue
to further open Japan to American agricultural and livestock
exports -- especially important considering the U.S. trade standoff
with China. Mr. Lighthizer, testifying to the Senate Finance
Committee on Tuesday, said the U.S. is "making headway" with
working out a larger agreement with Japan, with more progress
expected during the G-20 summit in Osaka.
AHEAD
--The EIA releases its ethanol data at 10:30 a.m. EDT
Wednesday.
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. EDT Thursday.
--The USDA will issue its monthly Cattle on Feed report at 3
p.m. EDT Friday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
June 18, 2019 15:57 ET (19:57 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.