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Morning Outlook


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Overnight Highlights

  • Overnight markets have corn +1, soybeans +1-3, wheat +3-4, crude oil +.24, dollar -.18, gold -4.0 and the Dow +16.
  • Grain markets mixed to higher overnight following the market longs running for the door yesterday on relief rains this week and a cooler 6-10 day outlook. Support coming from continued longer term weather uncertainty and rising premiums in the Gulf for soybeans.
  • Rumors around that China has secured 2 to 3 cargoes of old crop soybeans and 3 to 4 of new crop.
  • Limits in corn are expanded to 40 cents following the limit down close right at the end of yesterday’s session.
  • Overnight, soaking rains were found from Southern Minnesota to Indiana illustrated on the lightning strike map below.
  • July grain options will expire Friday.
  • Funds were reported sellers of 47,000 contracts of corn in yesterday’s trade.

Commodity Weather Group Forecast



In North America, thundershowers favored central SD, far southern MN, northern/eastern IA, north-central MO, central/northwest IL, central IN, northeast MT, southern/northwest ND, southern Saskatchewan, and southwest Manitoba in the past day. Highs were mostly in the 80s to low 90s, with mid 90s or better in parts of the Delta, KS, and NE. Rains will continue into tomorrow in the central/southeast Midwest, particularly with a line of strong storms tonight. Shower chances otherwise are best in parts of eastern KS/southeast NE/southwest IA/MO on Thursday night/Friday and again on Sunday, with the southwest Midwest/South favored for the best rain chances next week. The near-term rains should narrow the driest spots in the Midwest to parts of MI, southern/west-central IL, central/southeast MO, southwest IA, eastern KS, southeast NE, and east central SD, where rains have also been limited in the past two weeks. However, the showers next week should ease stress for pollinating corn in currently hotter/drier spots (mid 90s to low 100s into the weekend) in the southwest Midwest/Delta, narrowing the most severe rain deficits to 20% of the corn belt for now. A lack of severe heat is expected next week through early July, as the strongest warmth focuses west of the corn belt. The western Midwest has also trended wetter in the 16 to 30 day, but rains appear to remain limited in the northeast 1/2 of the corn belt.


In South America, Brazil corn/sugar areas had light showers in the far south yesterday. A mainly

dry pattern sets up for the next two weeks, ensuring favorable harvest conditions across the belt.

Argentina was dry yesterday and remains dry this week, aiding corn harvest. Models are finally in

good agreement that rains will expand across the belt this weekend into early next week. This

should alleviate dryness in northern wheat areas but will lead to some delays to corn harvest.



Lightning strikes overnight:



All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.




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