MarketsFarm — Soybean, corn and wheat futures in the United States all found themselves under pressure as the calendar flipped from May to June, with both the fundamental and technical signals turning bearish for the grains and oilseeds.
“We’ve got a technical thing going on with corn and wheat,” said Rich Feltes of RJ O’Brien in Chicago, noting a move below major moving averages in the two crops was encouraging additional speculative selling that was spilling into soybeans as well.
The July corn contract at the Chicago Board of Trade dropped below its 50-day moving average on Tuesday, with continued selling on June 1 seeing it near the 100-day average.
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U.S. grains: Soybeans retreat after one-month high; corn, wheat sag
Chicago Board of Trade soybean futures turned lower on Tuesday on profit-taking after the benchmark contract touched a one-month high in early moves, while market players continued to monitor U.S.-China trade relations, analysts said.
Chicago and Kansas City wheat contracts also fell below those key 20- and 50-day moving averages during the week, while Minneapolis spring wheat lagged to the downside due to persistent seeding delays in the northern U.S. and eastern Canadian Prairies.
Managed funds had built up heavy long positions across all the major agricultural markets but were now in a liquidation phase booking profits, according to Feltes.
A lack of major weather problems for U.S. soybean and corn crops, increasing Russian grain exports and the likelihood of a global recession were all contributing to the fund selloff, which could keep grains and oilseeds under pressure going forward.
— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.
