Charts of the Day – October 22, 2021

Chicago Wheat

Afternoon Market Commentary – October 22, 2021

by: Chris Betz

Corn Soybean Wheat
Old Crop (futures month, change, settle price) CZ1 5’6 538’0 SX1 3’4 1220’4 WZ1 14’6 756’0
New Crop (futures month, change, settle price) CZ2 3’0 533’0 SX2 6’0 1223’6 WN2 9’6 756’4

Technical Thoughts – October 21, 2021

By: Ken Lake

At the end of last week, it was clear that a potential trend change was at hand.  At the end of the session in Friday we had scored two consecutive higher closes in both corn and soybeans.  On Monday we had positive follow through in those contracts confirming the move higher.  By Wednesday corn had scored 4 of 5 sessions higher and soybeans a perfect 5 of 5 sessions higher.  All good signs of a trend change.

In the Wednesday night and Thursday morning session a bit of give back is taking place but this week’s trade coupled with the fact that seasonal lows sometime occur in mid-October give us encouragement that a trend change is at hand.  It will take awhile to confirm a trend toward higher values but thus far this week’s trade is a good start.

Thursday’s break in value was anticipated but thus far of little consequence to this week’s move.  Fast stochastics are hinting at a possible sell signal but other momentum indicators do not agree.

CZ21 is currently trading above its 50-day moving average, 534 with support at 532, 528.  As long as we remain above 525, we will be above last week’s close.

SX21 still the weaker ag component as it is barely above its 20-day moving average, 1241 this morning.  WE need to close above 1217 this week to score a weekly reversal.

Fertilizer Update – October 1, 2021

By: John Ezinga

Data to think about while you are in the combine…..

Here is a chart I just put together on total USDA acres planted by year (yellow) overlaid with fertility cost in red. Obviously there is a correlation below but there are many factors that will decide final plantings.

Acres in yellow are using the right axis for final USDA acres planted (in millions). Right axis is a weighted average for nutrient removal cost to grow 1 bushel of corn (based on IPNI data).

Looking at the high and low of corn acres planted it appears that we will change out about 10%, with 97 million acres on high side and 87 million acres on low side.…….Remember this is a country wide comparison. There will be much more significant % shifts in acreage on the fringe of the corn belt. The central corn belt will probably not change much in their normal rotation.

So, if you decide to buck the high fertilizer prices and grow more soys don’t forget to market your soys while you have favorable spreads to your cost (we can help with that!) I also attached a current breakeven sheet for your review. The columns highlighted in blue are what I would call comparable yields of the three major crops. Soys are looking really good today…..will they look that good next harvest?

And, if you missed it, here is a link to a podcast with Ashley Davenport from Michigan Ag Today regarding the fertilizer markets…give it a listen and follow Michigan Ag Today…they do a great job keeping our community informed all week long.