Daily Market Cast: 6/16

Daily Commentary: Tuesday, June 16, 2026

Transcript

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Hey everyone, this is Allison giving you today's daily grain market commentary for Tuesday, June 16th. And the last two sessions had really been a good reminder that markets do not move in a straight line. Energy markets broke, inflation concerns eased, and grain markets followed the flow lower. So this week, overnight trade has been a seller's dream. But as the day session unfolded, something changed, and we're seeing this selling slow. And that pattern has repeated itself here over the past two days. Overnight weakness has attracted buyers during the day session. So we're not in a bull market, we're not calling a bottom here, but after a brutal sell-off, the market finally appears to be finding support. So now it's time to focus on something different, and that's re-ownership. No one's timing here is perfect. Ours won't be either. But for anyone interested in reowning previously sold bushels, especially if any sales were done in the past two weeks, we want to be in a position ahead of the June 30th and quarterly stocks report. Um, and of course, we have a potential US market ahead of us too. But buying calls today is not a call on the market bottom. This is risk management. So the risk on onsold bushels remains a continuation of the downtrend. That scenario is still very much on the table. However, it's also possible that weather becomes a concern. It's possible demand improves, it's possible the funds return as buyers. That is what these calls are designed to address. So for re-ownership, we want two things: time and limited risk. And calls do that. Once these positions are on, the maximum risk is what you paid for them. There is no margin calls, there's no surprises for each crop, which I'm gonna go through today. I'm gonna go through a few of these strategies. So if you're interested or just want to walk through how they work, feel free to give us a call. But corn was the first market to really show signs that sellers are starting to lose momentum. After dropping roughly 80 cents from their spring highs, December corn has managed three consecutive sessions of higher closes. Again, it doesn't mean the lows are in, but it does suggest that the easy downside may be done with. So the market still needs a reason though to shift psychology. But with sellers losing uh pace here, pollination risk ahead, we do want re ownership tools in place for anyone wanting some upside coverage on sold bushels. So looking at some re ownership here, for old crop, September 440 calls are about 12 cents. That's roughly $600 a contract per 5,000 bushels. For new crop, we like using short dated options. They trade off the new crop contract, which is December for corn, but expire earlier. So a September short dated 470 call is about 10 cents or about $500 a contract. Again, these are limited risk strategies. Worst case scenario, the market fails to rally and you're out the money you paid. September corn did settle less than a penny lower today at 422 and a half. December ended less than a penny higher at 442.5. And soybeans actually posted some of the strongest gains um across the grain complex today. Uh, talk of potential Chinese buying did spark some fresh momentum. No purchases, though, have been announced, so we feel um we need to treat these rumors very carefully here. But new crop U.S. soybeans are now competitive against Brazilian supplies, making the US a more attractive origin than it was just a few weeks ago. So sometimes markets rally on expectations long before actual sales are confirmed, and that appears to be part of today's story. So new crop soybeans have dropped 92 cents from the recent highs and have now clawed back roughly 38% of that break. So that does not mean the market's fixed, but it does tell us buyers are interested when given a reason. So looking at some re ownership for old crop, September 1180 calls are about 20 cents, roughly $1,000 a contract, 5,000 bushels. For new crop, look at some September short-dated $12 calls. They're about 20 cents. Again, about $1,000 a contract. Um, the risk is the same, just like corn, but if you want a cheaper strategy, give us a call. We have had some interest in some call spreads, which may cost less, but they do involve some additional risk. So July soybeans did end the day 10 and three quarter cents higher at 11.30. November gained 11 and 3 quarter cents, closing at 1146 and a half. And wheat continues to struggle with harvest pressure and lack of its own bullish story. And even after dropping more than a dollar from the highs, the market has only managed to recover about 25% of the recent sell-off. So for now, wheat appears more likely to follow corn and soybeans than generate a bullish story of its own. So for producers looking at to re own some bushels here, we do suggest using Chicago wheat options just due to liquidity. So some re ownership ideas. September 625 calls are about 20 cents, roughly $1,000 a contract, or September $6.50 calls, they're about $14 cents, roughly $700 a contract. Today we saw September Chicago Week closed three and three quarter cents higher at $6.04 and a quarter. September KC ended at $6.41, $4.25 lower. September Minneapolis finished four and three quarter cents lower at $6.35. And the cattle complex charged higher today. It's drawing triple digit gains. So it's the same story that was driven the market for the past, you know, last two and a half years. Supply remains tight while demand continues to hold together. Mid morning beef cutouts were $4.65 higher, adding just more fuel to the rally. So the trade's expecting cash cattle to trade moderately higher here again this week. But despite numerous negative headlines during the bull market here, the bulls continue to stampede higher. Short cattle numbers have been the primary driver, but consumer demand has remained strong enough to support these historically high prices. So if the economy continues on its current path, we expect beef demand to remain near current levels. In another session like today, and live cattle contracts will be approaching their contract highs. New World Screwworm detection has now climbed to 12, and that number will likely continue to increase. As the quarantine areas expand, there is the possibility that market ready cattle could face delays in reaching slaughter facilities. In the short term, that scenario would be supportive again to cattle prices. So June cattle were up $4.675, closing at $2.55.30. December was up $4.85, closing at $2.40.72.5. August feeders were up $5.32.5, closing at $3.66.87.5. October was up $46.32.5, closing at $362.425. And lean hogs, however, they continue to struggle. October hogs posted new lows for the move and closed right at a major support level. So if the market cannot stabilize soon here, another leg lower does appear pretty likely. The biggest issue does remain just lackluster demand. With beef prices at record levels, stronger pork demand would normally be expected. But so far that shift in consumer buying has failed to materialize. So July hogs were down $1.77.5, closing at $94.80. October closed below $80 today at $79.92.5, which was off 30 cents for the day. October hogs need to hold this level, or we are expecting another $7 lower. So again, if you have any questions, as always, feel free to reach out. Otherwise, have a great night. We'll talk to you again tomorrow.