Weekly Bushel Cast: 5/22

Managed Bushels Weekly Update: Friday, May 22 2026

Transcript

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Hey everyone, this is Allison giving you this week's Managed Bushels update for Friday, May 22nd. Starting off with corn, the July contract finished the week at 463 and a quarter. But July has rallied 54 cents since the January low to the most recent high. So even after this week's ugly reversal, roughly 30 cents of that rally is still intact. And that has many producers starting to ask some questions. Did we miss it? Is it still okay to make some cash sales here? And the short answer is yes, because 460 is essentially the midpoint of the entire rally. So that means even after this week's sell-off, the market is still offering a relatively strong cash sale compared to where we started the year. Producers often like to look at the high instead of asking whether today's price still makes business sense and it does. Now, if this turns into a true weather market, there is always argument for upside risk. We all remember 2012, corn broke hard from the May highs to the June lows, convinced everyone that the rally was over, and then exploded higher beginning in July as weather deteriorated. And of course, that possibility exists, and exactly why we look at some re ownership. And if you need to move some cash grain, reward the rally, you can make the sale and preserve some upside using calls, especially in case weather becomes a story again. So technically, the first key area of support sits around 455, 456. That is last week's low, and you're the 61% retracement of the rally. If that level fails, we can see the bulls lose momentum pretty fast. Um, so again, if you are making sales, made sales, want to stay long corn, look at using July 470 calls. They were about 10 cents today. They expired the 26th of June. December corn futures finished the week at 486 and a half. And we saw in a matter of three days, December corn going from $5 to trading back near 483. So that's a big enough break to get our attention, but not big enough to say the opportunity is gone. We still are in a weather market here. Mother Nature may still have one more push higher and a retest of that old contract high near 512. It can't be ruled off the table. But hope is not a marketing plan. So if you're not ready to make additional cash sales at this point, look at using some puts to defend this area while we wait. The point is not to turn bearish, the point is just to protect the profitable window here without giving up the chance for another weather-driven rally. So December corn gave us $5 this week. Now it's telling us we need to respect the break as well. So defend the rally, stay open to the upside, and do not let a good opportunity turn into a missed one. So here again for new crop, we are recommending being 30% sold. And there's multiple options on how you can, you know, protect yourself on this, you know, in the couple months here going forward. So a 480 July shortdated put costs about 9 cents. You could do a 475 in the same month for about seven. Both of those expire the 26th of June. And if you do want more time, look out to August short dated puts. A 480 costs about 17 cents. 475 is gonna cost you 17. Both of those expired the 24th of July, so it gets you right through um any weather market, whether it develops or not. Now, looking on the soybean side, July futures finished the week at $11.96 and a half. But we did see a 30 cent uh swing this week, and once again, we're flirting with that $12 level. But we did see some bear spreading here to finish the week, and that can be read two ways. First, it shows caution towards old crop demand, but it also hints that the trade may be protecting against a tighter new crop setup later. And a lot of this goes back to China. The US keeps touting the deal, but China has yet to confirm major purchases or even step in with sizable old crop demand. So until that happens, the trade is cautious about chasing the front end higher. But here's the other side. If China does not buy more old crop now, that demand risk does not disappear. It just shifts into new crop. So add in lower production estimates, fewer acres, and using trend line yields right now, and suddenly that comfortable soybean picture can tighten quickly. So soybeans are not explosive yet, but they are not dead either. We'd really like to see it close back above $12 on a weekly basis. Hopefully next week we can do it. But until China proves demand is real, rallies need discipline. But downside should not be taken for granted either. So if you have some old crop beans, don't be afraid to make the sale. Now looking on the new crop side, we saw November futures finish the week at $11.87 and three-quarters. And November soybeans kind of act like a honey badger market. They refuse to break, hanging in here right around $11.90, despite plenty of reasons to really wobble. So if you are not at least 30% to 35% sold on new crop, this is your reminder. Get there. Um we started 2026 at 1055, and at today's price, we're still over a dollar thirty into that rally. And that is real revenue. So don't let the market steal that from you because you got caught up waiting for a perfect high. Now, the bullish argument is easy enough to make. China has not bought any meaningful new crop beans yet, but newsflash, they likely will not rush in here. China has the all the leverage right now, and every reason to wait for a correction before stepping in is there. So that matters because if demand is not here today, the market needs weather to carry the story over the next couple of months. Technically, the uptrend line comes into um play near $11.73. So that makes $1180, $11.60 area a logical place to think about defense. But perspective here matters. Um, this market gives 25 cent trading ranges almost daily. So if you have done little to nothing so far this year, spending 8 to 25 cents to protect $1.35 rally is not unreasonable. And the math is pretty simple: $1.35 divided by four, roughly 33 cents. So you could justify sacrificing a quarter of the rally to protect the other three quarters while still keeping your upside open if this turns into 2026 version of 2012. So again, get 20, 30, 35% sold, get caught up here. Um, if you're waiting to make sales or not comfortable doing any more yet, a July short dated um 1170 puts about 12 cents. You could do an 1160 put there also in July for about 8 cents. Both of those expire the 26th of June. Or you could look at a little bit more time. August short dated 11 to 70 puts about 25 cents, and August 1160 short dated is about 20 cents. Both of those expire the 24th of July. Now on the springweed side, we saw July futures close the week at 689 and a half. So, yes, July spring wheat suffered a 30 cent break this week, but perception here again matters. Even after the setback, the contract is still trading roughly a dollar above where we started the year. And that is exactly why producers get in trouble. We focus on what the market just lost instead of what it has already given us. And a 30 cent break feels ugly in the moment, but a market still sitting a dollar higher than January tells us a very different story. Still debating whether to make a sale, just do it. Um, spring wheat has handed producers a profitable opportunity here in a market that still carries weather risk, acreage uncertainty, and quality concerns. But profitable is profitable. So do not have to pick the high here to make a good marketing decision. Make the sale. Now on the September, on the new crop side for wheat, um, we did see September finish the week at 7, 10 and a quarter. And like old crop wheat, new crop spring wheat took a sizable step back this week. But here's what matters both September and December contracts are still holding near or they're holding above the $7 level. And that is impressive. And more importantly, it's creating opportunity. So there's currently about a 20 cent carry from September to December. So if you have September futures contracts tied to elevator delivery but may have some storage available, it is worth looking at rolling those sales forward because you potentially capture that additional 20 cents in the futures while also giving yourself a chance at a better basis later. And the same logic carries further out. If you have a December delivery plan, there is roughly a 15 cent carry into March with that contract finishing the week near four or 745. So for producers with storage, that deserves a hard look. Rolling some bushels forward could improve your futures price and create some flexibility on basis. And if March is knocking on the door of $7.50, that might not be a per terrible spot to also add some additional sales as well. And now on to canola. Well, despite some big swings in soybeans and other oil markets here this week, canola futures actually held together very well. In fact, several contracts are now retesting recent highs. And the charts look impressive. And the reason is simple. The market is growing more concerned about Canadian supply. Stats Canada winter acreage survey showed 2026 canola acres up only 1% from 2025, and that's simply not enough. A 1% increase still points to a historically tight carry out, and the market likely needs a 4% to 6% acreage increase along with trend line yields to really build enough supply to satisfy demand. Because agriculture and agrofood Canada's May supply and demand report estimates showed a cut to canola exports, which did raise projected new crop ending stocks. But even so, demand's not weak here. Domestic canola crush margins remained near record highs, roughly four times higher than they were at this time last year, and that matters. The export side may have been trimmed here, but domestic usage does continue to do the heavy lifting. Sounds very much like our soybean um contracts. But meaning overall here that the market needs supply. But fresh farmer selling has slowed in Canada just due to recent cold temperatures and limited moisture. In Saskatchewan reported spring seedings advanced 29% complete, while the province canola planting was only at 15% complete. So progress is being made, but there is still plenty of crop left here to be put in the ground. So canola's willing together because the market's trying to buy acres. Uh farmer selling has slowed, crushed demand, like I said, is extremely strong, and Canadian weather still matters. So this remains a supportive setup unless planting conditions improve enough to really take the supply concern off the table. So here too, if you haven't made any sales for new crop canola, this is your kick to do so. But markets have certainly gave us a lot of volatility this week. Not necessarily clarity. Weather risk is still alive, China remains more talk than action, and several markets are still offering some profitable opportunities here, despite the late week break. So producers are always long. The goal is not to pick the exact high, it's just to protect revenue when the market offers it. So hope's not a strategy, discipline is. So if you have any questions, as always, feel free to reach out. Otherwise, have a great Memorial Day weekend. We'll talk to you again next week.