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Daily US grain report: future prices power ahead amid full-blown weather market

US grain futures prices were solidly higher in overnight trading Tuesday (28 May), with corn hitting a nearly 12-month high and wheat at a three-month high.

28 May 2019, at 1:22pm

It’s a full-blown weather market in the grains, and it’s not even June yet.

Soggy US Midwest weather, and more of the same in the forecast in the next week, will keep many US farmers out of their fields and continue to keep the seeding of corn at a pace that is the slowest in recent history. As each wet day in the Corn Belt passes, lower production levels for corn and soybeans are more likely and even highly probable now.

July corn
July corn

Bulls in firm control. Pause just recently is not bearish. More upside likely, but accompanied by very high volatility. It could be the market tops out this week, at least for the near term. © Jim Wyckoff

Wheat futures will continue in a follower’s role. If soybeans and corn continue to rally, wheat will, too.

Part of the gains in the grain market just recently are due to the large speculative “fund” futures traders getting squeezed out of their short positions that were record large just a few weeks ago. At some point, if not already, those funds will likely move to the long side of the grain markets.

Traders will closely examine Tuesday morning’s weekly USDA export inspections report.

July soybeans
July soybeans

Bean bulls gain some momentum, but mostly because of strong rallies in corn and wheat. Prices need to push above resistance line to suggest more gains likely in near term.