By Kirk Maltais


--Soybeans for July delivery rose 1.9%, to $14.00 1/4 a bushel, on the Chicago Board of Trade on Tuesday, with fund traders covering short positions after the USDA reported lower crop quality, and upcoming weather forecasts are uncertain.

--Wheat for July delivery rose 0.3% to $6.36 a bushel.

--Corn for July delivery fell 0.9% to $6.12 a bushel.


HIGHLIGHTS


Mounting Losses: Hotter and drier weather provided corn and soybean futures a lift - with traders reacting to a drop in U.S. corn and soybeans in good or excellent condition. The USDA reported in its latest Crop Progress report that 61% of corn is in good or excellent quality, down from 64% last week. Meanwhile, 59% of soybeans are in good or excellent condition, down from 62% last week. "The decline of three points in U.S. soybean and corn ratings are supportive, despite the fact it is early in the crop season," said Terry Reilly of Futures International in a note.

Changing Strategy: Fund traders reversed course today from building a short position to covering those shorts. The changing sentiment around the weather in crop-growing areas is supporting that change. "Momentum trading algos are buying the chart strength," said Arlan Suderman of StoneX in a note. Suderman notes that a new wave of thunderstorms may soon arrive to the Midwest, but the weather forecast is not clear for the upcoming weeks.


INSIGHT


Delayed Ruling: The decision of the EPA to delay the release of its blending requirements for fuel in 2023, 2024, and 2025 is giving grain traders hope that the EPA will increase the amount of biofuels that might be required to be blended with fossil fuels. "The delayed EPA decision has some suggesting a positive revision for biodiesel/renewable diesel may be coming," said Rich Nelson of Allendale. Soybeans saw the most support from the EPA's news.

Rocking the Boat: Ports on the West Coast are grappling with growing tensions between workers and companies, which is creating fresh issues with shipment delays and backups for goods passing through ports like Long Beach, Los Angeles, and Seattle. Port workers say that they've been working under an expired labor contract since July 2022, and seek compensation for the money made during the volatile supply chain conditions of the Covid-19 pandemic. "Disruption at the ports upends supply chains, delaying delivery of a wide range of consumer goods as well as perishable agricultural exports," said Peter Tirschwell of S&P Global Market Intelligence in a note.


AHEAD


--The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

--The CFTC will release its weekly Commitment of Traders report at 3:30 p.m. ET Friday.

--The USDA and the Chicago Board of Trade will be closed in observance of Juneteenth on Monday. Both will reopen on Tuesday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

06-13-23 1509ET