Bushel Cast: 6/5

Managed Bushels Weekly Update: Friday, June 5, 2026

Transcript

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Good afternoon, everyone. Today is Friday, June 5th, and this is Sam with this week's Manage Bushels update. July 26, futures for corn closed at 417 and a half. You can still buy nearly at the money puts for relatively little money. Why even consider it? Because there are still downside risks on the chart. First is the obvious $4 market. That is a big fat number that will attract the trade's attention. Beyond that, there is last year's low of $368 and three quarter. Whether you believe in old low targets or not, the funds and algorithms often do. That makes it a logical downside target if selling accelerates. We are not predicting either one happens. I'm simply pointing out where the market could go if weather remains favorable and funds continue reducing risk. That's the job. And remember this: we'd much rather see you spend 10 cents on a put and watch corn rally than be forced into an emotional cash sale during a 40 or 50 cent break. Good marketing decisions are rarely made in the middle of panic. If you are forced to move grain here, strongly consider re-ownership with inexpensive calls. The only thing worse than making cash sale into a sharp sell-off is watching the market rally 40 cents two months later with no ownership left. Protect the downside, preserve the upside, that's the goal. Still holding an August 420 put costs roughly 10 cents. A 415 put costs about 8 cents, both expiring July 24th. Already sold, stay long using an August 450 call for about 10 cents. December new crop futures closed at 446. New crop corn has dumped nearly 40 cents since last Friday and is now almost 60 cents off the contract high at 506. We are also sitting just a couple cents above the January USDA low that everyone remembers. That makes 445 a major line in the sand. If 445 fails, the next downside target becomes 440, which would market fresh two and a half year low, going all the way back to December 2024. Again, do not shoot the messenger. We are not happy about this either. We are just as frustrated as you are. But marketing decisions have to be based on reality, not unicorns and puppy dogs. So what if you have no new crop puts? Look up buying protection, but I would keep it cheap. This is not about getting fancy. This is about stopping the paper bleed. Nobody wants to spend money on puts after a sell-off. We get it, but doing nothing after a 40 cent break and hoping the market just magically turns around is not a strategy. Protect the floor, keep the upside open, live to fight the next rally. Looking for protection in August 440 put, defending against a break below the January low is roughly 12 cents for 49 days. That also gets you through the upcoming USDA reports with the acreage report being the big one. Now on soybeans, July futures closed at 11.21 and a half. Old crop soybeans have been hit hard in just five trading sessions. July beans have dropped nearly 80 cents and are now testing the area below the 61.8 retracement. Support broke at nearly every major level this week. If the selling continues, the next downside target is near 1104, which is awfully close to the around $11 mark. Like corn, I'm not saying we get there. I am saying that is the risk. The frustrating part is that the charts are already oversold and soybeans can be explosive if they turn back higher. That is what makes this so difficult. We have had good opportunities to make old crop sales, but if you still have bushels left, this is not the place to panic. Keep the protection cheap or look at reownership if you are forced to move cash beans. The goal is the same as corn, protect against the next leg lower, but do not completely walk away from upside if this market decides to snap back. Need to make a sale, stay long. August 1160 calls are about 16 cents, expiring July 24th. Want protection, August $11 puts are 14 cents. That protects you on an absolute flush. Also expiring July 24th. New crop November futures closed at 11.37 and a half. We do not know if there will be a drought, but we do know that if we were China and Pinky promised President Trump to buy 1 billion bushels of soybeans, we are a lot more interested in buying them near $11 than at $12. But honestly, if we do not see at least some China buying soon, that should raise a few eyebrows. It does not have to be massive, buy two cargoes, remind the market you are there. Remember how fast that lit the fuse back in January? That is why this year's rally was such a good reminder for hedgers and cash sales. Some of you do not want to spend money on puts, some of you cannot. I get it, but making a cash sale costs nothing. We are here to make good cash sales, we are not here to buy puts and make money. This is a hedging plan, not a day trade your way to riches plan. You are a farmer, you are always long. That means you have to get comfortable making cash sales when the market gives you the chance, or at least hedging and keeping those hedges in place on on-price bushels. This is the whole point of managed bushels. Want protection, August short dated $11 puts are about 12 cents, expiring July 24th. July springweight futures have quietly become one of the more frustrating markets on the board. USDA rated the crop well below trade expectations, and conditions across North Dakota, South Dakota, and Montana remains far from impressive. In most years, those would be supportive headlines. Instead, traders looked at the forecasts, saw rain chances across the northern plains and Canadian prairies and sold first. That has been the theme all week. The market is trading potential improvement, not current conditions. The good news is that a significant amount of weather premium has already been removed. Minneapolis wheat has suffered substantial technical damage over the past month, but much of that damage is now visible on the charts. The bad news is the harvest pressure is expanding across winter wheat areas and funds remain comfortable, reducing exposure across the grain complex. We are not ready to throw in the towel, however, spring wind is still has a long growing season ahead and weather forecasts are not final yields. But until traders see proof that production risks remain, rallies may continue to attract sellers. Need to make a sale, make the sale. Already sold, examine buying features near support levels. If that isn't comfortable for you, look at using Chicago wheat or corn options as a cross edge. New crop, September futures closed at 646 in a quarter. The market continues betting that improving weather across the northern plains, Canadian prairies, Europe, and the Black Sea will solve a lot of production concerns. Maybe it will, maybe it won't. What we do know is that funds have been actively reducing risk and wheat has already lost a large amount of premium from the spring highs. If weather remains favorable, downside pressure could continue. If conditions fail to improve, wheat may be one of the few markets capable of reminding traders that crop ratings still matter. Need to make a sale, we recommend being 30% sold. Canola continues taking its cues from the broader oil seed complex, even with making fresh new contract highs earlier in the week. Weak soybean prices, favorable North American growing conditions, and continued fund liquidation across agricultural markets have limited buying interest. At the same time, the market remains vulnerable to any weather issues that it develop across the Canadian prairies as we move deeper into summer. The challenge right now is that traders are willing to bet on production before the crop is made. We have seen the story before. Forecasts look friendly, weather premium comes out, and the market assumes everything will work itself out. Sometimes it does, sometimes July and August have different ideas. For now, the path of these resistance remains sideways lower until weather gives the market it reason to care again. That does not mean prices cannot recover, it simply means producers should stay disciplined and focus on opportunities rather than trying to pick the exact high. We recommend being at least 3% sold on canola. You are a farmer, you are naturally long. The goal is not to predict the next weather scare. The goal is to protect downside risk while preserving upside opportunity. Don't let it sell off force emotional marketing decisions. That's from all of us at the Money Farm team. This concludes today's Manage Bushels weekly update. We hope everyone has a great weekend, and we'll talk to you next week.