Market Movers to Watch for the Week of June 9th 2024

Jun 06, 2024

Wet Start to 2024 Planting Season Means Lower Corn Yield

This week there are 5 key reports to watch that could have significant impacts on commodity markets the week of June 9th, 2024. This Farms.com column tracks key events in commodity marketing impacting the agriculture industry! The series of article shares issues to watch the following week, issues that may have an impact on commodity prices in the coming weeks.

By Devin Lashley
Farms.com Risk Management Intern

1.The June WASDE Report will be released on Wednesday June 12th. The USDA is known to slow walk it, so will they drop the U.S. corn yield after a very wet start to the 2024 planting season.

Most years the trendline yield at 181 bpa will come in unchanged, but 2024 has been just as wet 2019 and the USDA surprised that year with a 10 bpa yield drop. A sub 177 U.S. corn yield takes ending stocks below 1.7 billion vs. current USDA forecast at 2.1 billion.

A friendly USDA is needed to get funds to short cover and provide farmers a better chance at selling bushels at higher prices. South American corn and soybean and Russian wheat production will also be in focus.

2. The U.S. Crop Progress Report will be released Monday June 10th and will likely show that the 2024 planting season is coming close to being completed, but with the wet weather through mid-June it could take another week to 2 weeks to complete.

The first U.S. soybean crop conditions report will be released with the 5-year average at 64.6 percent good-excellent but the last 20 percent will need to be planted and not all of the soybeans would have emerged yet.

3. The U.S. CPI/PPI Data will be released Wednesday June 12th and Thursday June 13th respectively. A lower-than-expected number due to falling crude oil prices could hint of a U.S. Fed interest rate cut sooner than markets are expecting in September of 2024.

4. The next U.S. Fed Reserve Board Meeting will be held on Tuesday and Wednesday June 11th and 12th and will likely not result in any interest rate cuts. Any change in the narrative will be key to stocks, 10-year yield and the U.S. dollar Index.

Recently rate cuts seen from the European central bank and the Band of Canada have spiked hope of the U.S. following suit. That being said, falling crude oil prices could be causing inflation to fall, and so could the Federal Reserve cut earlier? Perhaps as soon as the July 31st meeting?

5. The U.S. Drought Monitor will be released Thursday June 13th and will likely show little development in droughts across the Midwest and southern winter wheat growing regions. Lately storms and intense rains have battered major growing regions reducing droughts to almost minimal levels, however forecasted mixes of light rain and sunshine will likely only reduce droughts slightly across major growing regions.

For daily information and updates on agriculture commodity marketing and price risk management for North American farmers, producers, and agribusiness visit the Farms.com Risk Management Website to subscribe to the program.

Video: Will the 2025 USDA December Crop Report Be a Market Mover/Surprise?

Historically, the USDA December crop report is a non-event or another dud report as the USDA reserves any final supply changes to the final report in January of the following year in this case 2026. But after the longest U.S. government shutdown in history at 43 days and no October crop report will they provide more data/surprise and make an exception?
Our China U.S. soybean purchase tracker is now at 26.6% or a total of 3.2 mmt but for traders it’s taking too long to unfold.
The final Stats Canada production report was bearish canola and wheat projection a record crop in both (it adds to the global glut of supplies) and bullish local corn and soybean prices in Ontario/Quebec thanks to a drought. It will not help the fund flow short-term, the USDA may need to offset it?
A U.S. Fed interest rate cut of another 25-basis point next Wednesday (probability 87.1%) could help fund flow and sentiment in stock and ag commodities into year end.
More inflows into Bitcoin this past week saw prices rebound back above 90,000 with support at 82,000 and resistance at 96,000.
A V-shaped bottom in cattle suggest the lows are in after Mexico reported another new world screwworm case. Lower weights, seasonal demand and higher U.S. beef select/choice values with a continued closure of the Mexican border to cattle will result in a resumption of higher cattle futures into yearend.
Australia is expected to produce its 3rd largest wheat crop ever at 36 mmt adding to the global glut of supplies.
Reports of ASF in hogs in Spain the largest pork exporter in Europe could see the U.S. win more pork export business long-term.
If the rains verify into next week of 3-5 inches for Brazil it would go a long way to fixing the dry regions from the last 2-months, but the European weather model has been wrong for the past 2-months!
Natural gas futures are surging to the 3rd price count as frigid hold temps set in.
CDN $ is also surging to end the week on a very resilient economy and better employment numbers suggesting no interest rate cuts next week.
Finally, the CFTC report showed funds were net buyers of soybeans but sellers of corn, canola and wheat. In real time the funds have gone back to selling as they take some profits.