The Commstock Report

06/10/2026 Time to Take Our Hand Off the Hot Stove? PLEASE REFER TO THE BROKER COMMENTARY PAGE FOR UPDATES!! Click Above to Watch Brian's Afternoon Market Update Part 1 of 2 Better Places to Live El Ninos are measured by temperature/heat. A Super EL Nino, now forecast, would be considerably hotter than a typical El Nino. "A "Super El Niño" is an informal term used by forecasters to describe exceptionally strong El Niño events. While a typical El Niño raises Pacific Ocean temperatures by at least 0.5^C, a super event drives those temperatures to 2^C or more above average, resulting in far more extreme global weather disruptions." When air temperatures warm, atmospheric rivers enlarge as they can hold more water. The correlation between heat and humidity is exponential rather than linear. Wet areas will get much wetter and dry areas much drier. All associated weather risks grow and intensify accordingly. Other historically recognized Super El Niños since 1950 occurred in 1972–1973, 1982–1983, 1997–1998 and 2015-2016. That would make this one the 5th Super-El Nino since I began farming in 1973. The problem, conundrum or experiment is that the earths base temperature has risen significantly since 1950 so adding another 2^+C from a Super El-Nino is a really big thing. Global…

Part 1 of 2 Better Places to Live El Ninos are measured by temperature/heat. A Super EL Nino, now forecast, would be considerably hotter than a typical El Nino. "A "Super El Niño" is an informal term used by forecasters to describe exceptionally strong El Niño events. While a typical El Niño raises Pacific Ocean temperatures by at least 0.5^C, a super event drives those temperatures to 2^C or more above average, resulting in far more extreme global weather disruptions." When air temperatures warm, atmospheric rivers enlarge as they can hold more water. The correlation between heat and humidity is exponential rather than linear. Wet areas will get much wetter and dry areas much drier. All associated weather risks grow and intensify accordingly.   Other historically recognized Super El Niños since 1950 occurred in 1972–1973, 1982–1983, 1997–1998 and 2015-2016. That would make this one the 5th Super-El Nino since I began farming in 1973. The problem, conundrum or experiment is that the earths base temperature has risen significantly since 1950 so adding another 2^+C from a Super El-Nino is a really big thing. Global temperatures in 2025 were an average of 2.14 degrees Fahrenheit (1.19 degrees Celsius) above the 1951…

06/10/2026 Reco Day 3: Buy back 10% of short December 2026 corn futures hedges (for modest 5 cent gain). Buy back 40% of short December 490 corn calls (for modest 2 cent gain). This leaves short futures and long December 450 puts in place to hedge downside against 90% of 2026 corn sales while reopening upside exposure for 50% of the position. The goal is to keep downside protection a bit longer through the growing season while opening longer-term upside post-harvest.   *** Futures trading involves risk. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance is not indicative of future results. Click Above to Watch the Morning Market Talk Video Wheat Leading Corrective Bounce On the Grains Grain and soy markets strengthened overnight amid corrective buying as traders covered short positions ahead of Thursday’s USDA reports. Just as they led to the downside, wheat futures are pacing the corrective recovery. As we noted yesterday, traders are taking note of heightened attacks in the Black Sea region, with Russia targeting Ukraine’s Odesa ports, threatening agricultural exports from the key shipping hub. Crop concerns in the U.S. and other…

In late 2024 my wife and I were asked by friends to accompany them to visit the White House at Christmas. The last-minute invitation came from college friends, he is now the Mayor of Madison South Dakota. He had worked with the Biden White House on an infrastructure program that brought water to the Madison municipality and had received a special invitation for a White House Christmas tour. It was a fortuitous opportunity to tour the East Wing as it is no longer there, having since been razed to the ground by President Trump for his new ballroom. One thing I remember about this trip, though, was the plane ride home. One of our adjacent passengers, with whom we conversed, turned out to be a USDA scientist/official. She was on her way to Mexico. They were worried about the screw fly outbreak, and she was heading down there to assess the risk. She told us that at one time there were 3 labs set up to produce sterile flies which is how they'd controlled it. They had pushed the fly south to Panama. Then for whatever reason—most likely cost-cutting—they closed two of the labs. This has proved to be the…

06/09/2026 Reco Day 2: Buy back 10% of short December 2026 corn futures hedges (for modest 5 cent gain). Buy back 40% of short December 490 corn calls (for modest 2 cent gain). This leaves short futures and long December 450 puts in place to hedge downside against 90% of 2026 corn sales while reopening upside exposure for 50% of the position. The goal is to keep downside protection a bit longer through the growing season while opening longer-term upside post-harvest.   *** Futures trading involves risk. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance is not indicative of future results. Click Above to Watch the Morning Market Talk Video Markets Take a Needed Breather On the Grains: Grain and soy futures modestly favored the upside overnight, aside from soyoil, as pressure from recent fund liquidation eased. A breather for the next couple of days is likely as traders square positions ahead of Thursday’s WASDE and Crop Production Reports. While no major changes to USDA’s forecasts are expected in those reports, markets need a pause. Corn, Soybean Crop Ratings Strong; Slightly Below Year-Ago & Average USDA rated…

Recco Day 1: Buy back 10% of short December 2026 corn futures hedges (for modest 5 cent gain). Buy back 40% of short December 490 corn calls (for modest 2 cent gain). This leaves short futures and long December 450 puts in place to hedge downside against 90% of 2026 corn sales while reopening upside exposure for 50% of the position. The goal is to keep downside protection a bit longer through the growing season while opening longer term upside post-harvest.    ***************************   There are probably a lot of lessons that can be learned in the last week from the market. The first one that comes to mind is, "It is always bullish at the top." Hopefully customers took our advice, selling on the way up. It would have been nice to get closer to the high, but we sold at profitable prices, choosing our targets rather than having it being chosen for us. Had it not been for the Black Swan event in the form of the Iran War, it seems reasonable to assume we never would have seen $5 corn. The seasonal high appears to be in.   Giving up 30 cents in a week should not…

06/08/2026 Click Above to Watch the Morning Market Talk Video Fund Selling Continues, Weather Generally Favorable On the Grains Corn and soybeans faced follow through selling overnight. July corn posted another contract low, while December corn dropped to the lowest since mid-August 2025. July soybeans fell to the lowest since early February, while November is trading near the mid-March lows. Wheat traded on both sides of unchanged overnight, with a varied tone this morning – SRW chopping around unchanged; HRW and HRS futures trading modestly higher. Funds continue to shed length in grain and soy futures, as weather is viewed as generally favorable for crop development. As of June 2, their combined net long position across corn, the soy complex and wheat markets was cut to 531,627 futures contracts – about 60% of their length one month prior. But that’s still plenty of length they could shed. Seasonal to above-normal temperatures are expected across the Corn Belt this week. There is a near-daily chance for rains, favoring southern and eastern areas of the Corn Belt – areas that are already saturated. Flood Warnings for South China Farmland Heavy rains and flooding are forecast for southern China over the next 10…

Grains poised to open with a rebound attempt that could quickly fall flat. In the Headlines Volatility picked up on a second straight week down for grains. July corn futures fell 29 1/4 cents, July Chicago wheat dropped 30 1/2, and nearby soybeans lost 65 1/4. It was also a volatile week for livestock with August live cattle that finished higher by $2.60 while August feeders gained $5.47. June hogs made new lows for the move after dropping $1.55 for the week. The S&P 500 stock index snapped a nine-week winning streak after having its worst day of the year on Friday. Having just made new record highs earlier in the week, stocks took the hit after a strong jobs report supported hawkish views on interest rates. The focus on monetary policy continues this week with updates on inflation, as well as with the European Central Bank meeting likely producing a rate hike on Thursday. Israel carried out strikes in Lebanon on Sunday despite a fresh ceasefire agreement being in effect, which Israel said had been violated earlier by Hezbollah fighters. Negotiations with Iran were described as remaining at a standstill as skirmishes continued in the Persian Gulf. Comments on…

A significant shift was marked in the expectations for U.S. monetary policy. Futures markets moved to assign a higher probability for the central bank raising interest rates this year over keeping the federal funds rate unchanged at 3.75 percent. The updated interest rate outlook was a reversal from the start of the year when traders were pricing in at least two quarter-point rate cuts, with some positioned for as much as a full point of easing. FOMC rate hike odds and bond market yields jumped further on Friday following the monthly jobs report.   Payroll counts were stronger than expected, just as numbers were in the leading employment reports earlier in the week. The Jobs Openings and Labor Turnover Survey (JOLTS) for April measured job openings climbing from 6.9 to 7.6 million, the highest in nearly two years. Layoffs were down, but fewer people quit their jobs, which signaled diminishing confidence in being able to find something different. Similarly, even though job openings were up, actual hirings were down, suggesting employers were stretching out the hiring process and becoming more selective due to uneasiness about the economy. Another private payrolls report for May beat expectations as it recorded growth in…

06/05/2026 Click Above to Watch the Morning Market Talk Video Markets Relatively Calm for Now After Tumultuous Week On the Grains Corn futures extended their sharp price plunge overnight, with July marking a contract low and December falling to the lowest since mid-January. Soybeans and the wheat markets had a varied tone in two-sided trade. All things considered, grain and soy markets were relatively quiet overnight after a week filled with massive fund liquidation. The aggressive fund selling has left markets overdone to the downside, but it’s difficult to get the herd turned when it’s all heading swiftly in one direction. Bulls need a catalyst to halt the selling and reenergize their efforts. Markets indicate weather conditions are viewed as generally favorable. While that may be broadly the case, these maps signal there are extreme variances. It’s haves (ample soil moisture) vs. have-nots (drought) vs. have too much (saturated). Key through the growing season will be whether the extremes smooth out or widen. The geopolitical situation in the Middle East remains shaky. Attacks continued overnight between Hezbollah and Israel in southern Lebanon after the Iran-backed militant group rejected a U.S.-brokered proposal aimed at securing a broader truce. The U.S. and…