RCM Ag Services

Category: Education

30 Mar 2026
Agriculture, CME, Education, Futures, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: A futures reversal summed up last week’s trade

Recap:

A futures reversal summed up last week’s trade. We came into the week on a positive note, with trade becoming more fluid. Monday’s fat-finger debacle ended that quickly, and it took the rest of the week just to claw back half of the move.

The cash market told a different story from futures. Trade was solid throughout the week, with strength across most species; only spruce lagged. SYP continues to move higher in sizable increments, and I would expect Spruce to begin catching some of that enthusiasm. While higher rates and crude prices remain headwinds, the market’s attention today is squarely on supply and demand. Improving weather conditions should also help bring a few buyers back into the market.

Technical:

Monday’s selloff did some damage, pulling the market back into the March expiration area. As a result, May’s technical structure has reverted to early‑March levels, effectively nullifying the upcycle that had been forming. From here, the levels are well defined. A close back above the old high of 614.50 would restore upward momentum and put the market back on a positive trajectory. Conversely, a close below 582.00 would signal a technical reversal and shift the near‑term bias lower.

Daily Bulletin:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Southern Yellow Pine:

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/southern-yellow-pine.volume.html

The Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

 

About the Leonard Report:

The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

 

Brian Leonard

bleonard@rcmam.com

312-761-263

23 Mar 2026
Agriculture, CME, Education, Futures, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: Did it turn into a battle when it should have been a rout?

Recap:

Did it turn into a battle when it should have been a rout? The cash market is very active with less supply. Things are tight, and some mills are OTM for a day. We are where we expected to be except for the issue of $100 crude. No one could have projected it. Without the Iran issue futures would be $50 higher and blowing out the funds, but instead we have to scratch and claw for a few bucks. The question today is if we missed the acceleration move or not?  We have the rally but now can we get the run?

Crude is becoming “more of the same.” It isn’t going back down, but the likelihood of larger crude restriction is lessening every day. In the same vein, the US has made clear that higher crude is a small price to pay. The end result,  a long drawn out fight sending the spec longs in crude elsewhere. That begins more of the same.

So, what does the battle look like?

The Tight Market:

Companies large and small are using the same strategy of limiting Cap X to keep costs down in 2026. Inventory is the largest cost so cut it and you cut costs. Sound economics to me except for the fact that when your business is a commodity, you need that commodity to remain in business. What we saw last week was a push by many firms to at least fill in.

It is spring. We see a natural tightness to the market every year. Demand numbers are already set. It becomes a time to buy.

The Demand Struggle:

The housing data is weak. New and existing home sales have pulled back even with the multiplier. Months of inventories are up sharply. Even Canadian starts are projected to be off for the next few years.

There are two debates going of when the housing market became broken. The first was the obvious 2008. Many economists believe that by the mid-teens that problem was fixed. They believe that it again happened after 2018 when the housing market broke and never recovered. We are talking about the typical economic forces, not covid, etc. My point is that in either case we had an employment fear for the first time home buyer. Today, looking at the projection of a 30% unemployment rate for new graduates, I would say nothing has changed since 08. Employment and employment sentiment are the key drivers, not rates, not affordability, just employment.

Finally, open interest continues to erode. We are seeing a sharp drop in industry longs as the market rallies. COT showed a 898 decrease while the fund shorts exited 588. The industry is putting money in the back. The funds are forced to lighten up with large rallies. It is true textbook trading.

 

Technical:

I can’t say this very often, but the technicals are neutral at best when the fundamentals are strong. Another lower session will force a cross of a few oscillators to negative. This isn’t a sell signal as they tend to go back and forth before it becomes a sell signal.

The focus is on 618.50. The market needs a close over it. On Friday the high was 614.50. We are very close to gaining some momentum again. I believe it is going on for 5 weeks that 618.50 was the objective. The hitters are getting tired and the winds are blowing in. We need to get through it this week.

Daily Bulletin:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Southern Yellow Pine:

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/southern-yellow-pine.volume.html

The Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

 

About the Leonard Report:

The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

 

Brian Leonard

bleonard@rcmam.com

312-761-263

16 Mar 2026
Agriculture, CME, Education, Futures, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: A Good Week

Recap:

A good week. We saw a few negative economic reports, crude over $100, and interest rates creeping up. One would think futures traded lower, but they didn’t. It actually squeezed out a new high for the last three sessions. There is a slight appearance of things getting tighter. If it showed up, we would have been substantially higher, but it didn’t. It’s only the anxiousness fueling the buys. The trade can count. There hasn’t been a cash buy since the first week of January, and that was muted. We will need a spruce buy at some point. Is it only another fill in, or will it be better? Either way it will cause a rally from here in May futures. I normally would be nervous about the gap we left with the March expiration. Right now, May is in the middle of a momentum push. We can save the gap at a later date. For now, we have to see how far May can go. It is driven by tightness in supply and a need to buy. Nothing else.

Technical:

The futures trade has been condensed to small ranges and small moves. The May chart is very positive. It looks as if a $12 pop is in the cards. Yes, that is correct. A whopping $12. That’s as far as the market allows you to measure. The 21- and 13-day averages are starting to cross. The resistance points sit at 606 and 612. Clear those and now the 618.50 double top comes into play. There is a May gap from 632 to 635. By midweek the pattern will be defined, either one of continued upside or more of the same with a “slow cash” pullback. Stay with the hedge selling plan.

RSI 59.80%

 

Daily Bulletin:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Southern Yellow Pine:

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/southern-yellow-pine.volume.html

The Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

 

About the Leonard Report:

The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

 

Brian Leonard

bleonard@rcmam.com

312-761-263

12 Jan 2026
Agriculture, CME, Corn, Education, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: POST JANUARY 12 USDA REPORT

Corn took a dive on today’s USDA report with 1.3 million more harvested acres and larger yield than expected coming in at 186.5 bu/ac. With this comes more production leading to larger ending stocks, brutal two-sided hit for the corn bulls. Corn had done a great job of climbing higher since early December, but today’s report gives all the momentum back to the bears with South America’s growing season off to a great start. Corn’s big move lower sent it below all technical support and unless we see a quick turnaround this week what was a support level could turn into overhead resistance as we are now at levels last seen in August.

Via Barchart

While the USDA report was not as bad for beans, it did suffer double digit losses with a slightly higher than expected national yield of 53 bu/ac. One important item was that US exports were revised lower due to more world competition. This is important as we still need China to buy US beans as we do not have another major market catalyst as the Trump administration has not been friendly for the implementation of SAF (sustainable aviation fuel). The month and half of +$11 beans we saw will be a struggle to get back to as South America continues to roll on with another record crop expected.

Via Barchart

Equity Markets

Equity markets roll on despite some days of volatility with headlines from the White House and drama surrounding the Fed. As you can see in the chart below since last April’s tariff scare the markets have been steadily moving higher.

Via Barchart

Other News

  • The precious metals trade continued its strong 2025 into the start of 2026 with new highs in gold and silver.
  • Wheat had ending stocks rose modestly and the price was dragged lower with corn.

Drought Monitor

Here is the most recent drought monitor.

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or blawrence@rcmam.com.

 

09 Dec 2025
Agriculture, CME, Corn, Cotton, Education, Futures, Grain, Hedging, Livestock, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weather, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: NOVEMBER 14 – DECEMBER 9

Corn has been trading sideways since the end of October and nothing from today’s USDA Report gives it reason to change course. The main news for corn has been the lack of news. Corn did dip 20 cents in late November but bounced back to the middle of the range it has been in around $4.45. In today’s USDA report they kept US production the same while raising the export forecast by 125 million bushels, lowering US ending stocks to 2.029 billion bushels. The global stocks number was also revised lower with production cuts to other countries, including Ukraine. While the report was modestly bullish corn will need some more news to leg up to the $4.60 range as South America is off to a great start.

Via Barchart

Beans have tumbled off their recent highs as the rocket higher ran out of fuel and has been giving back those gains. The USDA left US production the same with an overall neutral report with no major surprises. Global stocks were slightly raised as Brazil, India and Russia offset tighter supplies elsewhere. With no news to turn this recent downtrend around the market needs positive China trade news desperately as that was the initial “news” to drive markets higher.

Via Barchart

Equity Markets

Equity markets have rallied from the November dip and are within a couple % of new all time highs. The markets are expecting another rate cut this week and would be surprised if there is not.

Via Barchart

Other News

  • The wheat numbers were mostly unchanged and did not have any major news to change the direction of trade but could turn around on global trade news.

Drought Monitor

Here is the most recent drought monitor.

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or blawrence@rcmam.com.

 

14 Nov 2025
Agriculture, CME, Corn, Cotton, Dow Jones, Education, Futures, Grain, Hedging, Market Commentary, Market Updates, Other News, Research, Risk Management, Soybeans, Weather, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: OCTOBER 27 – NOVEMBER 14

Corn’s Thursday rally was met with a post report Friday dip and gave up 10 cents back to $4.30. Despite the late season crop problems of drought and rust, the USDA did not find the corn yield loss that was expected and came in with a 186 bu/ac estimate, higher than the trade estimate. With higher production came higher US ending stocks, but those were not raised as much as yield as corn exports and domestic industrial demand has been exceptional this fall. The chart still looks constructive, but after a 30-cent rally in one month, the market will look to take a breather, especially after today’s report.

Via Barchart

Beans have been on a great run higher, albeit with some volatility, until Friday’s USDA report. Coming in that hot to a report can lead to a let down which we saw to some extent. The bean yield numbers were not as surprising as corn, coming in close to estimates, but the market still took a hit. The number to look at was the US held bean imports to China unchanged at 112 MMT for the 25/26 marketing year. A flash sale report did show sales of 1.1 mbu to China around the time the trade deal was in the works. The delayed data is hard to fit with all the other news out there but China buying anything is a good sign.

Via Barchart

Equity Markets

Equity markets have been volatile the last few weeks as worries of an AI bubble continue and several large companies such as Palantir, Meta and Oracle are well off their 52 week highs. Volatility will likely remain in the market for a bit as we will get caught up on economic data that was missing during the government shutdown.

Via Barchart

Other News

  • The wheat numbers were bearish as domestic and world stocks continue to climb on record world yields in all producing countries and exporters finding exports difficult to come by even at rock bottom prices. Wheat will remain an anchor on corn rallies.
  • Cotton adjustments show 900K more bales of US production, 200k more bales of US exports, and 700K more bales of US ending stocks compared to September.

Drought Monitor

Here is the most recent drought monitor as harvest rolls on.

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or blawrence@rcmam.com.

 

15 Sep 2025
Agriculture, CME, Corn, Dow Jones, Education, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, USDA Report, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: AUGUST 29 – SEPTEMBER 12

Corn continued to move higher off last month’s lows following the September USDA Report. Most of the numbers came in along estimates but they increased planted acreage 1.4 million acres. This brings the US corn crop to 98.7 million acres, a new record. With about 90 million acres expected to be harvested, we will harvest 7 million more acres this year than in 2024, which equates to about 2 billion bushels larger crop than last year. Despite the added acreage corn bounced post report as weather issues, a dry finish, and disease pressure have caused speculation on the real size of this crop. As harvest gets rolling we will learn more about this crop.

Via Barchart

The USDA Report did not have any surprises for beans as most numbers were close to estimates, but the report could be viewed as slightly bearish. To get beans moving higher, China needs to show up as a buyer and trade talks with China need to make progress. China and the US are reportedly close to a deal over Tik Tok which can hopefully build some momentum for progress between the two countries. The size of the soybean crop, like corn, has been hurt by lack of rains down the home stretch but with the solid start the end result is still in question as harvest rolls.

Via Barchart

Equity Markets

Equity markets continue to make new highs with the Federal Reserve expected to start cuts this month. With the downward revision of 911,000 jobs from March ‘24 to March ’25 the labor market weakness gives the Fed some ammunition to lower rates with unemployment being one of their mandates.

Via Barchart

Other News

  • Secretary Rollins is in the process of looking into payments to farmers for this year with the low prices.
  • The wheat numbers were actually a bit supportive but lower world cash prices (Black Sea mainly) continue to plague prices. Wheat will remain an anchor for any potential corn rally as more wheat will be swapped in for corn in feed. Prices are back testing the 5 ½ year Covid lows.

Drought Monitor

Here is the most recent drought monitor as harvest begins.

Contact an Ag Specialist Today

Whether you’re a producer, end-user, commercial operator, RCM AG Services helps protect revenues and control costs through its suite of hedging tools and network of buyers/sellers — Contact Ag Specialist Brady Lawrence today at 312-858-4049 or blawrence@rcmam.com.

Check it Out:

Bulls, Bears, and Beef: Risk Management When Prices Run Hot

02 Sep 2025
Agriculture, CME, Education, Futures, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: I have to start with the chart. It helps to clarify the argument that the mills’ added variable costs are of little relevance to the market

The Lumber Market:

I have to start with the chart. It helps to clarify the argument that the mills’ added variable costs are of little relevance to the market. That said, it did cause waves. The market bottomed in July of 2024 after Biden dropped out. It rallied up until the tariffs were put on hold, fell, and then rebounded into the duties. The argument today states that the flat demand warrants the market to test the low again. After Friday’s disappointing trade, it could be possible. Outside influences have moved the market higher since July 2024. We could return to the mean, but that is unlikely. What is likely is a 61% retracement of the move back to $525. That is based on the Sept contract. The cash market has not found a foothold yet. A $20 break in futures is nothing. Market indicators:

We remain a very efficient supply and demand market. Outside variables, while catching some momentum, do not change dynamics. Today, we have a macro issue. Stocks are too high for the pending increase in unemployment. Regional decreases in building activity can’t be picked up. And the last issue, and maybe the most important, is that a home is not affordable today. We keep putting lipstick on a pig, but housing is not affordable.

Note:

I like to mention the retirement of an outstanding person once in a while. Today I want to offer my congratulations to Jack Stevenson. We go back to the Tim Stock days. He finished up with USLBM. Great character and great market knowledge! Enjoy!!

Daily Bulletin:
Southern Yellow Pine:
The Commitment of Traders:
About the Leonard Report:
The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.
Brian Leonard 

bleonard@rcmam.com
312-761-263
18 Aug 2025
Agriculture, CME, Education, Futures, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: The feature of the week was the extreme down move between Monday and Wednesday

The Lumber Market:

The feature of the week was the extreme down move between Monday and Wednesday. Sept futures dropped almost $46 in three days. At the same time, the open interest was rapidly decreasing. It was all liquidation. The longs were selling, the algo was selling, and the industry was buying their shorts back. The algo doesn’t accumulate a position, so it was all sides of the trade exiting. The Commitment of Traders report showed a sharp drop in the industry shorts. After nine sessions of selling, futures caught a breather on Thursday and returned to the sedate mode on Friday. At this point, the market needs a macro look now that most of the noise is behind us. The following points are key:

It’s a tough call here. A bit of good news can pop the market, while no news erodes your inventory value. The data is neutral. I would look for a general pickup in demand or at least building going into the fourth quarter, but this outside noise never ends. Selling your cash is the best trade.

Technical:

The September futures have corrected 85% of the move. The majority of the time, if it goes 61% it goes 100%. That puts the 594.50 low as an objective. Now most are out of shorts already, so there won’t be a large volume to buy from here down. That makes least resistance down. The one caveat is that the RSI is only 20%. It needs a better correction.

Note:

Tuesday:

Starts 1.30 down from 1.32

Permits 1.39 down from 1.4

Friday: Existing a smidge higher…. more inventory, more sales.

Daily Bulletin:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Southern Yellow Pine:

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/southern-yellow-pine.volume.html

The Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

About the Leonard Report:

The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

Brian Leonard

bleonard@rcmam.com

312-761-263

14 Jul 2025
Agriculture, CME, Education, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: The September futures made a new high last week and held it

The Lumber Market:

The September futures made a new high last week and held it. It’s not the contract high, but a trend high. We are seeing a higher drift in both cash and futures as the deadlines near. The commitment of trader’s report has a big drawdown in the industry holding of both longs and shorts. We also saw a big jump in the funds long number. Industry trading doesn’t have a big effect on prices. The funds do. We will see if they continue to add or stay neutral.

I’m looking for a reactionary spike once the higher levels are announced the producers raise their prices. From there we have to determine the starting line and measure from it. For a year now, or since Wallstreet confirmed a Trump win, the market has been in an up channel. I will attach a chart of that below. Pure economics indicates possible offsets .

All this will take time. That is why we expect an early spike. From there it will come down to demand.

I struggle with the fact that the industry is bailing out of hedges both longs and shorts when directional risk is growing.

Technical:

Daily Bulletin:

https://www.cmegroup.com/daily_bulletin/current/Section23_Lumber_Options.pdf

Southern Yellow Pine:

https://www.cmegroup.com/markets/agriculture/lumber-and-softs/southern-yellow-pine.volume.html

The Commitment of Traders:

https://www.cftc.gov/dea/futures/other_lf.htm

 

About the Leonard Report:

The Leonard Lumber Report is a column that focuses on the lumber futures market’s highs and lows and everything else in between. Our very own, Brian Leonard, risk analyst, will provide weekly commentary on the industry’s wood product sectors.

Brian Leonard

bleonard@rcmam.com

312-761-263

Disclaimer

RCM Ag Services is a registered DBA of Reliance Capital Markets II LLC. Trading futures, options on futures, and retail off-exchange foreign currency transactions are complex and involve substantial risk of loss and are not suitable for all investors. Loss-limiting strategies such as stop loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of options and/or futures positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. There are no guarantees of profit. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. You may lose all or more than your initial investment. You should not rely on any of the information herein as a substitute for the exercise of your own skill and judgment in making such a decision on the appropriateness of such investments. Opinions, market data and recommendations are subject to change without notice. Reliance Capital Markets II LLC shall not be held responsible for any actions taken based on this website or attached links. Parties acting on this electronic communication are responsible for their own actions. Past performance is not necessarily indicative of future results.