Daily Market Cast: 6/8

Daily Commentary: Monday, June 8, 2026

Transcript

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Good afternoon, everyone. Today is Monday, June 8th, and this is Sam with today's commentary. After last week's deep downdraft, markets caught their breath to start a new week. That part is not surprising. Markets do not go straight down forever. But let's not forget what really matters in the background. The three things that drove prices higher for the first six months of the year were inflation fears and the idea that interest rates would eventually come down, weather fears and money flow from large speculative managed funds. All three are now on the back burner. Friday's employment number was strong. The Fed cannot cut rates if the economy is strong. In fact, the worry now is that rates may stay higher for longer or even push higher again. Sound nuts? Welcome to the economics of 2026. The stock market is at all-time highs, inflation is still a concern, and the market is trying to figure out whether good economic news is actually bad news for commodities. We did get some export sales this morning. The USDA reported 264,000 metric tons of soybeans sold to unknown destinations and 103,000 metric tons of corn sold to Japan. Corn export inspections also beat expectations, and soybean inspections were solid. We'd started this new marketing year too, and after just four days, inspections are running 7% ahead of last year. Soy demand has not disappeared. That is important, but the market is no longer being carried by inflation fear, weather fear, and fun money the way it was earlier this year. Now it needs proof. The big waiting game is still China. If China really is going to buy 25 millimetric tons of soybeans like promised, they have a pretty good opportunity. Spot beans at the Gulf have fallen back enough to be competitive with South America, but 2026 marketing is about one thing new crop demand. This morning's export demand could be China, yes, but private Chinese companies still face tariffs, so any new buying likely has to come from the government side of demand. That matters. The market does not need talk, it needs purchase confirmations. If you would like to watch or listen to the webinar Allison participated in last week, use the link below. It was a good conversation covering crop marketing, risk management, and the importance of staying structured in volatile markets. Corn futures continue to struggle, and the reason is not complicated. The corn belt looks good, forecasts remain mostly favorable, and speculative money has been heading for the exits. December corn tested the August 2024 contract loan near 440, which makes that level the most important line on the chart right now. Momentum indicators are deeply oversold with RSI below 20 and soatastics at extreme readings. That tells us the downside move is stretched, but oversold does not automatically mean a rally. Managed money liquidation remains a bigger story. Funds cut their net long position by more than 90,000 contracts in the latest reporting week. That is a big change. Remember, this was the same money flow that helped drive us higher earlier in the year. Greed works both directions. They loved owning corn when inflation, weather, and momentum were all working together. Now those stories have moved to the back burner, and the same crowd is reducing risk. The market has posted lower lows in 12 of the last 13 sessions. That tells you how strong the bearish trend has been. Yes, corn is oversold. Yes, we could see a bounce, but until weather or demand gives traders a reason to buy again, rallies are likely to be treated with caution. July corn futures ended the day higher by one and a quarter cents at 418 and 34. December futures finished unchanged at 446. Soybeans tried to stabilize in today's session, but it was worth remembering what drove prices higher during the first half of the year. Money flow. The latest commitment of traders report shows funds reducing their soybean long position by more than 33,000 contracts. Yet even after the liquidation, funds still hold a sizable net long position of more than 156,000 contracts. In other words, they have reduced exposure, but they have not abandoned the soybean story. The good news is that money can come back just as quickly as it leaves. We have seen it happen before. Funds are not married to a position, give them a reason to buy, and they will buy. The question is simple: what gives them a reason? Right now the answer is probably weather or demand. Everyone is watching the weather forecast as we move deeper into June. The other catalyst is demand, particularly from China. Until then, the market is waiting for its next story. The easy money has been made. Now traders need a reason to put risk back on. July swimming futures lost five and three quarter cents to close at 11.15 and three quarters. November futures gave back two cents to settle at 11.35 and a half. Wheat futures traded higher today, but the funds remain worth watching as they continue treating each class differently. Chicago wheat remains the weakest link with the funds carrying a sizable net short position of nearly 58,000 contracts. Kansas City Wheat has lost much of the weather premium it carried earlier this spring, but the funds still remain that long. And surprisingly, Minneapolis wheat remains the strongest of the all three classes, with funds still holding a net long position above 18,000 contracts despite recent selling. Today's bounce suggests some bargain hunting is emerging after recent weakness, but the bigger takeaway is that spring wheat continues to attract the most supportive money flow while Chicago wheat remains under pressure. Technically, Minneapolis July wheat is testing support near 615, while resistance lies near 625, followed by 631. A recovery through those levels would be the first indication that selling pressure is beginning to exhaust itself. With spring wheat reaching some of the most oversold conditions seen this year and funds actively reducing exposure ahead of Thursday's USDA report. The market appears increasingly vulnerable to a short covering bounce if any supportive news emerges. July Chicago wheat futures finished up three and a quarter cents at 583.25. Kansas City July futures finished at 629.3 quarter higher by 9 cents. And July Minneapolis futures closed unchanged at 619.5. Moving on to livestock, the New World Screwworm made headlines again today. USDA confirmed additional cases involving a young calf and a dog. While three of the recent cases are clustered closely together, the case involving the dog was reported near the New Mexico-Texas border. This development is somewhat disappointing as it suggests the current containment protocols are not yet fully stopping the spread of the pest. The price action in the cattle complex, both today and over the past week, tells us the market is nervous about something. The question is what? Is it concern over the New World screw worm outbreak? Is it uncertainty surrounding the economy? Or is the fear that the border could eventually reopen and increase cattle supplies? Whatever the reason, the market appears to be pausing and adjusting the current news cycle, and a battle between the bulls and bears is clearly underway. Despite the near-term uncertainty, most traders recognize one important fact the current shortage of slaughter cattle and feeder cattle is not going away anytime soon. Tight supplies remain the underlying fundamental story, and that factor should continue to provide long-term support to the market even as short-term volatility persists. Prices opened higher across the entire livestock complex, with most contracts posting small to moderate triple digit gains early in the session. However, true to recent form, selling pressure emerged after the first hour of trading. As the day progressed, the cattle complex came under heavy pressure, erasing the early gains and moving sharply lower. By the close, both live cattle and feeder cattle contracts had posted sharp triple-digit losses, reflecting continued uncertainty and a lack of sustained buying interest. June live cattle were down 355, closing at 246.52.5. December was off 410, closing at 229.57.5. August feeders were off 320, closing at 350.70 cents. And October was off 345, closing at 343.77 and a half. Lean hogs continue searching for a bottom. The decline has not been dramatic, but rather a slow and steady grind lower, which can be especially frustrating for bullish traders. This type of market action tends to wear down confidence over time, and that was evident in Friday's Commitment of Traders report. For the first time since mid-2024, managed money funds are now net short the lean hog market. Friday's report showed funds holding a net short position of approximately 6,500 contracts. This marks a significant shift in sentiment considering that in mid-February, FENS held a record net long position of more than 130,000 contracts. June lean hog futures are set to expire on Friday. The contract closed at 942.5 cents, down 27.5 cents on the session. Meanwhile, the lean hog index closed Friday at 92.54, leaving the futures premium within a reasonable range as the market heads towards expiration. This concludes today's commentary. We hope everyone has a great evening and we will talk to you tomorrow.