TOP STORIES:
Soybeans Bounce Back as Traders View Correction as Overstated
Soybeans for July delivery rose 5% to $13.96 a bushel on the Chicago Board of Trade Friday, with traders taking Thursday's steep drop as an opportunity to buy back into futures.
Lower Grains Prices Expected to Pique China's Interest -- Market Talk
1407 ET - Lower prices for US grain futures are expected to bring China back to purchasing more US grain exports, says Daniel Flynn of the Price Futures Group. Underlying fundamentals make grain traders think that a sustained turnaround could be in the cards, Flynn adds. "We have a weak carryover market and if the weather forecasts continue to change, reality will come into place," says Flynn. "It is not what you plant but what you grow." Corn is up 3.9% Friday, while soybeans climb 5.3% and wheat rises 4%. (kirk.maltais@wsj.com; @kirkmaltais)
STORIES OF INTEREST:
Selling Seen as Overdone as Weather Buoys Grains -- Market Talk
1005 ET - Selling in grains Thursday appears overdone, with wet weather seen as not enough to alleviate dryness in certain growing areas. "This week's hot/dry weather has really battered Western, Midwest and Northern Plains crops according to producer sources with yield potential to fall off the table unless immediate soaking rainfall arrives," says AgResource. "By soaking rainfall, we mean 2-4 inches, not the dust settling rains that 20% of Iowa has received in recent days." Weather models showing increased rainfall across growing areas was a pressure point for grains yesterday, along with macroeconomic worries. Corn is up 1.3% early in trading Friday, while soybeans rise 2.9% and wheat gains 1.3%. (kirk.maltais@wsj.com; @kirkmaltais)
Commodities Selloff Expected to Linger in 2021 -- Market Talk
10:28 ET - The big selloff seen in commodities across the board yesterday is "a sign of things to come," Capital Economics says. "The scale of this week's fall in commodity prices is ... consistent with our assessment that much of the rally over the last year or so has been led by investor speculation as opposed to a genuine improvement in the underlying fundamentals," the firm says. Slowdowns in China's economy are expected to further affect metals prices, while in agriculture, favorable weather in the US supports stronger-than-expected crop production. "We think that higher US production and subdued global consumption growth will help to tip the global market into a surplus in 2021/22," the firm says. (kirk.maltais@wsj.com; @kirkmaltais)
THE MARKETS:
Hog Futures Extend Decline -- Market Talk
15:43 ET - Lean-hog futures closed lower again, falling 2.1% to $1.08675 a pound. That makes it roughly 15 cents a pound that hog futures have declined in the past 10 days. A large part of the decline seen in hogs is being attributed to selling by managed money funds. "Funds were big-time long," says Craig VanDyke of Top Third Ag Marketing, adding that the 3-cent limit for hogs trading is extending the amount of time it takes fund traders to exit their long positions in hogs. Live-cattle futures finished up 0.4% to $1.2155. (kirk.maltais@wsj.com; @kirkmaltais)
(END) Dow Jones Newswires
06-18-21 1710ET
