When you mentioned soybean yields being pretty good, do you think USDA is going to have to raise yields in the report here coming up next week? Is that part of the pressure that we've been seeing in the soybean market? Or is this all technical because funds are still so long in the bean complex?

Yeah, it's a combination of both, I think.

I mean, technicals, I mean, you know, the correction in the bean length, the correction in the inner commodity spreads, considering the corn sell-off, you know, when you've got an almost dollar break in the corn market and beans – We're only down, you know, 30, 40 cents at one point.

Then they stuck out like a sore thumb.

But, you know, all the last two years, the managed money long in the soy complex, given the biofuels policy and everything else is really the fund long has been relatively sticky.

And I think that's, you know, if you look at the commitment, the evolution of the commitment of traders over the last two to three weeks, Obviously, we had a big fund long in corn, but when the fund long in corn started to roll over, you started to see shorts under the market, the managed money shorts started to sell this market.

And so that's where the vulnerability of the corn market kind of establishes that there are shorts willing to sell this market.

Do you think that Once we get into this new month, get past the elections and a few of these things, can we start to recover in these grains?

Garrett, what's your take? Are we just sort of collecting or catching our breath here after the Brazilian election situation?

Yeah, that's really all it was.

The soybean market was reacting to the real.

Now the real is starting to firm up here.

That's kind of led to this turnaround trade.

We're starting to slip away here a little bit.

Beans have turned lower, but The real has moved back another 1% to 2% firmer.

Have they moved into livestock? Or is that a market they are pulling dollars out of currently?

Uh, the grains, kinda feels like we're positioning a bit ahead of this, uh, WASDE report out on Friday.

Yeah, absolutely.

I mean, um, you know, corn's down two to three this morning.

Beans are eight to nine.

I think it's a combination of harvest pressure.

You've got this dollar strength out here as well.

Um, we're kind of divorcing ourselves a little bit away from the energy markets.

I mean, what's your thoughts on the cattle complex, Garrett?

The market grains traded a little cautious headed into that, didn't they?

Yeah, it's kind of been the case the last years that the markets kind of take a backseat or the grain markets take a backseat when we've got a macro day like today.

At the end of the day, you know, it was the Fed decision was kind of a will they won't they sort of thing.

I mean, we obviously know where the White House stands as far as interest rates are concerned.

But we also have, you know, we can see the inflation data and, you know, see what the Treasury yields are doing and that sort of thing.

So, I mean, markets are saying one thing.

Rhetoric is doing the other.

Are we seeing harvest pressure? What's capping the rallies here?

When the last time that they were this long in the market, though, we had prices that were much higher and that isn't, really unusual or that isn't just for corn they were much higher than this as far as price for soybeans and a lot of other things weren't they

yeah they were um you know it's it's tough because i mean really the last time we were like this is it was 16 years ago so um you know the fact of the matter is is that You know, there's a lot more money today than there was back then.

So, you know, ultimately, we can make those comparisons that they shared in 2010.

You know, yeah, they're at a record.

I mean, the big thing is what I look at is like the internals of the commitment of traders.

And the managed money long versus the managed money short, which you combine those, obviously you get your managed money net.

So, you know, this year, the managed money long is 493,000 as of last Tuesday.

What do we need to keep the momentum going, especially with soybeans over 13 bucks now?

And, you know, looking at the week in the grain market so far, soybeans have been on a tear and really has been kind of the upside leader here to start this week, Garrett.

Yeah, it's kind of culminating a combination of soybean oil yesterday was the leader.

Soybean oil stocks on that NOPA crush.

You know, oil stocks are now for July down year over year, and the USDA is forecasting a fairly large year over year increase.

Just strong demand for soybean oil.

We had record crush, even though it was a little bit smaller than what we expected or what the trade was looking for.

But Then you've got, you know, with all these rains across the Corn Belt, Central Illinois, you know, four to five inches of rains, you know, beans don't really like wet feet.

I mean, if we can get within, you know, closing distance here of five on the board, depending on your local basis, I mean, is this going to be an opportunity for folks to make some moves here on the corn side?

Just profit taking.

I felt like a little bit of that, you know, the real crops kind of divorced themselves a little bit from the wheat story.

I mean, Kansas city, we traded limit up at one point, but interesting to see the spread starting the weekend in the front end in Chicago and KC.

I don't know if it means much more than profit taking, but yeah, From the get-go, opening bell, we come in Thursday morning and the markets are firmer overnight, and then export sales are released, and then the row crops kind of sold off.

Timing is also tied with weather models, gyrations that are basically showing this ridge backing up or moving in, just fluctuating in here.

And when the GFS model runs a little bit hotter, then we rally, and when it backs off, then we sell off.

Combine that with some farmer selling and exports since corn were a little bit disappointing, especially with a little bit more aggressive offers out of Argentina, considering the size of their crop.

But what's it going to take here to keep the grains rallying? Because the narrative on Black Sea hasn't really changed.

When does the EU situation become a bigger play in our market?

exactly right because uh you know the bigger this issue becomes in the in the eu as far as the drought i mean ukraine is their major corn supplier um you know you europe could have a problem if if this war escalates and you know the ukraine rail systems have said that uh you know a significant portion of the rail capacity has been targeted by the russians excuse me so You know, if this EU situation deteriorates further, I mean, obviously, they're going to have a problem.

The majority of the corn exports out of Ukraine that typically go into, you know, the Middle East will be impacted.

I think that ultimately, though, you know, with this bigger Argentine crop, that should be able to offset that and won't be the same quality.

um the the key factor is is this brazil crop because brazil can sell corn to uh into that nina area uh ira and that sort of thing and they're a major customer um that they you know that that if this brazilian crop should happen to get bigger from this point forward um then they may be able to pick up the slack of those two to three million metric ton that's uh of additional business that may have to go from ukraine into the eu

What's it going to take?

You know, we're really, if you look at the seasonality of November beans, we're kind of at that point where it's a line in the sand, whether we are going to move significantly higher, i.e., you'll know beans above $13 or we're going to revert back to $10.50.

Beans have acted very, very well in the face of this Chinese business.

Garrett, do you think we need to have some weather premium in the market?

You know, that is a very good question.

And unfortunately, you know, I'm trying to read the tea leaves of spreads in the market ahead of this report next week.

And, you know, we've got like the DC corn spread near its lows.

It settled today at 33 and a quarter, which is right against contract lows.

And I think the biggest issue, which kind of clouds or creates a fog of war, if you will, is the old crop carryout.

Because even if we do have a production issue with a crop that's in the ground right now, I think the market realizes in the next 45 days to 60 days that this old crop carryout is going to move.

trading the heat ridge right or the right well you

Was that part of the push you thought we saw, or the pressure in the grain market, plus the fact we don't really have a significant weather threat right now?

Absolutely.

You know, it's, it's time.

You know, in, in our weekly newsletter that we put out, you know, we, we, we, we had targets for old crop corn, and, and, and they didn't hit.

But, um, you know, just our comment was it's time to, to move old crop corn.

You know, it's, it's...

You know, I, I think the funds are sitting here looking at this big old crop corn carryout.

Do you think we have a lot more downside risk in this market from a price perspective?

What are your thoughts?

Uh, you know, one's gonna probably have a bigger influence than the other.

I'll let you guess which one is that.

It's gonna be the Xi-Trump meeting that's, that the market's gonna be focused on.

Um, you know, obviously with new crop, uh, production estimates, they're, they're lar- they're all forecasts.

You know, I, I did see the trade esti- trade guesses out this morning.

I do see some, you know, it looks like some people trying to deviate from the, the USDA yields.

Do you think that that will impact their economy in such a way that they might see demand destruction there?