May 18, 2022

Wide-spread, heavy selling took over the commodity and stock market spaces today.  Wheat led the sell-off overnight, getting additional momentum early this morning after SovEcon raised its wheat production forecast by 1.2 million tonnes to a record high of 88.6 million tonnes and acknowledging potential to increase that number further.  Soybeans were able to sustain some slightly higher trade following the morning break after the USDA announced the export sale of 229,200 tonnes of soybeans for delivery to unknown (10,200 tonnes in 2021/22, 219,000 tonnes in 2022/23).  This sale was rumored to be the reason for the strength in soybeans yesterday.  The soy complex was sharply lower by midday after being sold off with the other commodities.  December 22 corn set its current contract high on Monday following fresh length in funds of around 20,000 positions.  With no follow-through buying behind them, liquidation was inevitable.  Weekly ethanol figures showed output unchanged at 991,000 barrels/day and stocks off 349,000 barrels to 23.79 mln bbls.  Weather outlooks have changed to become a little more wet bias but it appears that the question is not when it will rain but where.

Potential head and shoulders pattern on July soybean meal.

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