Soybeans and products end higher on talk of China export sales and Mark Schultz, Northstar Commodity, says rising soybean prices in China and Brazil also lent some spillover strength.
Soybeans had a strong technical day and are trading in the top end of their recent range on the charts. “I am watching the July soybeans, and we need to take out and close above the $12.58 area,” he says.
Corn followed soybeans and Schultz says underlying support in that market is coming from the continued hot dry weather in major second crop corn areas in Brazil which could cut production.
Yet, corn is still trading in its sideways trading range. “We need to close back above $4.65 in the July contract to turn the market trend higher,” he says.
CH and KC wheat made new highs for the move and then saw some farmer selling hit to pull futures lower on the day. “We are harvesting in Texas and so there is some hedge pressure and farmer selling at these levels,” he says.
However, the global weather concerns are not over. “The weather models in Russia have been flip flopping but they have been dry for a while and if they don’t get rain soon that crop will see yield loss.” The crop has already suffered frost damage and private estimates have trimmed production. “I think we need to see the crop drop to 80 million metric tons in Russia for the market to really take off,” he says.
