May 16, 2023

Heavy selling across commodities and stocks today resulted in sharp losses in corn and soybeans. The USDA's weekly crop progress report showed substantial gains in planting and numbers well ahead of 5-year averages. Corn planting is estimated at 65% complete (68% trade, 49% week ago, 45% year ago, 59% avg). Soybean planting is estimated at 49% complete (51% trade, 35% week ago, 27% year ago, 36% avg). The pressure from planting progress is likely compounding on the market when we take a look at areas that are the furthest ahead of their averages. Planting paces in Missouri, Illinois, Indiana, and Iowa are blowing ahead of the rest of the crop growing region. North Dakota is the only the state significantly behind its 5-year average pace. The 2023 new crop contract months traded their lowest marks in 17 months today. We are now testing support on Dec 23 corn at 500'0 and Nov 23 soybeans at 1200'0.

With the corn balance sheet looking it will be going from tight to large, we should get some nice opportunities to roll hedges forward. The Dec:Mar corn spread closed at a 10 cent carry and should continue to weaken going forward. Rolling at 11-12 cents would be right in line with the historical average and 13-14 cents would be a premium.

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