The first trading day of the month turned out to be a volatile as all three grains within the complex experienced some big moves and some chop on average volume. Corn started the month off to a positive start as they rallied to multi month highs, only to give back all the gains mid-morning when corn made new intraday lows and sold off into the closing bell.

Soybeans traded in a similar fashion to corn as they have a strong correlation to one another. Wheat futures continued to rally on rumors of damaged crops in major wheat growing region Russia and Europe. On Monday, wheat was able to trade and settle above 2010 highs set back in January. Tuesday was a quiet day across the board in the complex as all three grains stayed in a small choppy range. Rumors started to circulate about Russia putting an export ban on wheat which sparked funds and traders to close out their shorts and buy the market any chance they got. The export ban also affects corn, barley, rye, and flour which helped fuel the rally in corn. Soybeans were active on spread trades. On the overnight session for Thursday morning was a very interesting session. For the first time in nearly two years, wheat futures were limit up, and it was happening on the night session where volume is usually light. With that kind of price action, traders were uncertain of what to expect when the day session opened

On Thursday opening bell, wheat remained limit up which pulled corn and soybeans up as well. Thirty minutes into the trading day, prices in corn and soybeans started to retreat and wheat came off their limit up price. Grains chopped around the whole day as traders looked to play it safe when volatility picked up. Funds bought an estimated 25,000 lots of wheat to finish the session limit up and corn and soybeans finished at the lower end of their range. Activity once again picked up on the night session for wheat as it rallied up 50 points, but when the day session opened, it actually came into the negative territory and finished the day limit down. Corn held its ground after a choppy day and managed to end the session up and close the week at their highest levels since January 15. Soybeans also traded against wheat and close the week up and also settled up for the year. During Friday’s session, wheat briefly traded above 2009 highs. After a very volatile week in wheat futures, they settled up for 2010 and above 2009 highs. The CME Group has increased margin requirements for wheat due to the volatility.

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