RCM Ag Services

Category: Futures

18 May 2026
Agriculture, CME, Futures, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: Housing data continues to grind along

Weekly Recap:

Key Takeaways:

On Friday, May futures expired a buck over July. That means that there is no downside gap to go after. Also, the spread traded +4. We haven’t seen that since Sept of 2023. A case is building for less bad…

Housing data continues to grind along—not hot, not falling apart. 2026 is pacing slightly ahead of last year, but the bigger story remains margin compression. Costs are sticky, financing isn’t getting easier, and the entire chain is operating lean. Demand is there, but conviction is thin. This isn’t a demand problem—it’s a willingness problem. Nobody is comfortable. Dealers are hand to mouth; builders are managing starts carefully, and big boxes are still questioning turns versus dollars. The “feel” of the market is cautious participation—everyone’s involved, just with one foot in. We only see a trade when values dip into perceived replacement. There bids show up quickly, confirming underlying need. The lack of follow-through higher speaks more to positioning than fundamentals. Right or wrong structure remains the story.

Bottom Line
This is a low-conviction, high-cost environment. The market isn’t breaking—it’s grinding. Choppy trade, quick reactions to value, and limited downside follow-through remain the base case. The futures trade is confirming. The question is if the May trade means anything or not.

Technical
The market is flat. Price action continues to compress after repeated lower highs, but the pace of the declines is slowing. That flattening suggests selling pressure is losing momentum. Key levels are tightening, and the market feels like it’s coiling rather than trending. A push through recent highs would likely draw in momentum buyers, while dips are still being met with value-driven support. The wedge trendlines now sit at 596.90 and 558.30.

The lumber market doesn’t grind and then spike. A grind is usually met with more grinding. Lumber needs news to generate interest. So right now, we are looking at a close over 597 to push futures up to the 602 point etc. Last week’s low in May was 574.

Lots of verbiage for “same shit, different day.”

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

11 May 2026
Agriculture, CME, Futures, Hedging, Housing, Livestock, Market Commentary, Market Updates, Research, Risk Management rcmagserv 0 comment

LEONARD LUMBER REPORT: Housing data continues to lean neutral-to-slightly better

Weekly Recap:

Macro / Demand Housing data continues to lean neutral-to-slightly better, with 2026 new home numbers running modestly ahead of 2025. Currently we do not a recessionary setup—but a margin problem. Inflation-driven costs keep squeezing profitability across the chain, leaving builders and dealers operating day-to-day with little appetite for risk. Demand exists, but conviction doesn’t. The market is reverting to its mean where there are no more easy buys, replacement cost are higher, and resistance to paying up is building. Ironically, that reluctance could be what sets up higher prices later—higher prices, not demand destruction, may become the real pain point. Let’s note that the wood trading today is very cheap on a relative basis so the higher replacement is what it seems.

Industry Tone Everyone is still making money—but no one feels good about it. Big boxes are questioning SKU economics; homeowners are tapped out after years of upgrades, and low-rate mortgages are freezing mobility. It’s a functioning market, just not a comfortable one.

Futures / Structure The July contract continues to absorb the pressure from the roll, which is breaking away from the norm so far.  This appears less about excess inventory and more about real-time procurement replacing forward planning. Elevated replacement costs are forcing buyers to stay closer to the front month, sidelining second-month participation. Prior buying interest under May $570 suggests futures are being used efficiently when value shows up—signaling underlying need, not speculation. Any second month contract sub-$580 still screens as value, but patience is scarce. Like May, July increasingly looks like a delayed bear trap rather than true weakness. We continue to see the industry shorts liquidate telling us the key for basis, the sharp break possibility, is limited.

Bottom Line This remains a low-conviction, high-cost market. Structure—not demand collapse—is driving price behavior. Until margins stabilize or a catalyst hits, expect choppy trade, shallow dips, and value recognition as a timing tool, not a dollar.

Technical:

Since mid-2025, the market has produced four cycle-high rallies, each followed by a lower trend. Notably, the slope of each selloff has been flattening. The current weekly pattern—marked by a blowoff move lower followed by a marginally improved trade—could be signaling the start of a fifth cycle higher. This view is based on the May contract. With May expiring this week, timing makes the call difficult. The weekly trendline comes in near 554. If May can hold above that area, it would argue the next cycle is underway.

The technical read has only offered small portions of data and not much directional help recently. It looks as if there isn’t much offered in either cash or futures today.

 

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

08 May 2026
Agriculture, CME, Corn, Cotton, Dow Jones, Fertilizer, Futures, Grain, Hedging, Market Commentary, Market Updates, Research, Risk Management, Soybeans, Weather, Weekly Prices, Wheat rcmagserv 0 comment

AG MARKET UPDATE: APRIL 17 – MAY 8

Corn has been a tale of two forces over the past three weeks. Coming off the euphoria of Iran’s Strait of Hormuz reopening announcement on April 17th, markets initially attempted to stabilize, but that news seemed short-lived as volatility in the middle east kept markets volatile. With the war premium in and out of the market, it has been trying to trade both geopolitical news and fundamentals, and those fundamentals remain heavy. U.S. ending stocks at 2.127 billion bushels, the highest in seven years, kept a ceiling on any sustained rally, and fast planting progress added some pressure. The USDA’s crop progress report showed nationwide corn plantings at 38% planted. Exports remain strong as the potential for a smaller US crop with higher fertilizer costs keep buyers in the market at these price levels. December corn popped above $5 for a couple days but quickly fell back as it fell with crude on peace talks. Geopolitical events are hard to predict, especially with this White House, so if you get the opportunity for profitable sales, it would be something worth considering because if crude drops back to $70-80/barrel and we have another record/near record crop it will be hard to hold these levels or move higher.

Via Barchart

The market continues to wait for a fresh demand catalyst, and the one most closely watched, a potential resumption of Chinese buying linked to a Trump-Xi summit, has been repeatedly delayed amid ongoing Iran conflict negotiations, but appears to be on for this month. The bullish case for soybeans continues to rest on crush economics. Board crush margins holding above $3 per bushel are exceptional by historical standards and are supporting the nearby contracts. NOPA March crush are expected to far exceed year-ago levels, underscoring the strength of domestic demand for meal and oil. Brazil’s Conab raised its 2025/26 soybean production estimate once more to 6.582 billion bushels, and May shipment estimates from Brazil’s Anec were raised to 533.8 million bushels, peak export season for the world’s largest shipper. That supply overhang remains the key obstacle to a sustained rally with South America having such a large crop. Beans planted were at 33% for the week of May 4th, slightly lower than expected but still very strong for this time of year.

Via Barchart

Equity Markets

Equity markets continue to make new highs on the back of the AI trade with names like Micron, SanDisk and Western Digital screaming higher and other tech names having a very strong April with the NASDAQ Index up over 15% in the month. Big players such as Google, Meta, and Amazon reported in the last 2 weeks with mixed results but the markets moved higher.

Via Barchart

Energy Markets

Energy has remained the dominant macro force across all commodity markets, though the price action has been far more volatile and two-directional compared to the one-way crude rally seen earlier in the spring. This push-pull between ceasefire hopes and renewed escalation threats has created a volatile and headline-driven energy market. For ag producers, the primary implication is that fertilizer cost relief remains partial and uncertain. Diesel costs have come down from peak levels but are not back to pre-war norms, and nitrogen prices, which spiked nearly 40% during the war, have only partially retreated.

Via Barchart

Other News

– Cotton has continued its run higher on demand from overseas buyers with alternative fibers such as polyester needing oil for production. Growers can be profitable at these levels so having a hedging strategy where you protect the downside but can still participate in any further upside is very important.

– EPA finalized 2026–2027 Renewable Fuel Standard volumes at record highs, a development that could meaningfully increase ethanol demand and provide a long-term supportive floor under corn prices.

– Iran is reportedly evaluating a U.S. peace proposal that includes a full reopening of the Strait of Hormuz by both sides. Markets expect Iran’s formal response in coming days, making this the single most important macro event in the near-term commodity outlook.

– The May 12th USDA WASDE report will include the first official 2026/27 production forecasts for all major crops. Given the wheat situation in the Plains and uncertainty around corn acres, this report has the potential to be a significant market mover across the complex.

 

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.

 

 

04 May 2026
Agriculture, CME, Futures, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: Lumber futures are choppy and directionless

Recap:

Lumber futures are choppy and directionless, basically mirroring a housing market stuck in neutral. From the builders to distribution, the game plan is to contain losses.

  • The macro housing backdrop is decisively neutral. Existing‑home sales are weak, first‑time buyers are sidelined, inventory is improving only marginally, and mortgage rates remain a headwind—not a catalyst. Nothing here supports sustained upside, but nothing forces a full reset either.

  • Technically, May futures have found support near $570, helped this time by available EFPs, which are pulling buyers back into futures on a hand‑to‑mouth basis. The weekly wedge keeps tightening, suggesting a breakout window approaching into May expiration, though timing remains tricky without a catalyst.

Bottom line:
Futures are doing exactly what a neutral market does—failing rallies, finding buyers on weakness, and chopping traders to death. Until affordability actually improves or demand breaks meaningfully, this remains a range of trade driven more by structure and discounts than by confidence. Add to it that the industry likes the long side, and the funds continue to sell confirm more of the same.

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

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

LEONARD LUMBER REPORT: The futures trade was dominated by the roll last week

Recap:

The futures trade was dominated by the roll last week. That said, it made a new contract low and then rallied. We saw that pattern a week earlier—and frankly, we’ve seen some version of it for nearly two years now. Rallies continue to lack momentum, fail quickly, and ultimately find themselves testing new lows.

A technician put it best last week: these trends are neither bullish nor bearish—they’re bullshit. There’s no trend, no follow‑through, and no conviction.

The broader economic backdrop for housing remains decisively neutral, and neutral markets have a nasty habit of killing their own rallies without outside help. That’s exactly where we sit today.

So, let’s look at a few housing headlines for more color.

Housing Headlines 

• Existing home sales remain sluggish.
March existing‑home sales fell 3.6% month‑over‑month to an annualized pace just under 4.0 million units, the weakest March pace since 2009. Sales declined in all four regions, underscoring just how little organic momentum exists in the market. [markets.bu…nsider.com]

Existing home sales are projected to stay in line with 23-24 and 25. Without a rate cut expect slow sales and low inventories.

 The macro effect:

“This has caused multifamily executives to lower their expectations for total 2026 multifamily sales volume and starts.”

• First‑time buyers are effectively sidelined.
First‑time buyers accounted for only 21% of transactions, a record low and well under the historical norm near 40%. The market is increasingly split between equity‑rich owners and would‑be entrants who simply can’t make the math work. [crosscount…rtgage.com] Can’t make it work…. nice.

From NAR, first time home buyers fell to a record low. They made up only 21%. That group was always in the high 30 percentile.

• Inventory is improving—but not enough to matter .
Active listings are rising year over year, and months’ supply has crept above four months, technically closer to “balanced.” But inventory is still well below pre‑pandemic norms, offering just enough supply to cap prices—not enough to stimulate volume. [mortgagetech.ice.com]

• Prices refuse to break—only flatten.
Despite weaker sales, median prices continue to grind higher on a year‑over‑year basis, driven by limited supply and locked‑in owners. Zillow expects roughly flat price appreciation in 2026, reinforcing the idea of a capped, sideways market rather than a corrective one. [zillow.com]

Builders I work with are staying on course and keeping production at the planned 2026 amount. “Head down and grind ahead” seemed to be the common theme.

• Mortgage rates remain a headwind, not a catalyst.
Rates dipped briefly below 6% earlier this year, but volatility tied to macro uncertainty pushed them back toward the mid‑6% range. That swing was enough to choke off affordability gains but not enough to force capitulation selling. [cnbc.com]

To sum it up:

There’s nothing here that argues for sustained upside—and nothing ugly enough to force a structural reset. Housing is stuck in neutral, and lumber reflects that reality perfectly. Rallies fail because they’re supposed to. Weakness finds buyers because costs, supply, and discounts still matter.

Until affordability actually improves or demand meaningfully breaks—this remains a market that chops itself to death, one failed rally at a time. It bothers me every time we use the affordability excuse. The is more fundamental issues involved.

Technical:

The May contract has found support in the $570 area. The fact that there are EFP’s available this time has brought the buyers back to the futures market at a price. This hand to mouth environment tends to magnify deals. Today it is in futures.

The starts projection is for 1.38. Permits are 1.39.

The weekly wedge pattern keeps getting tighter. The breakout looks to be a few weeks from now. May expiration could be interesting.

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

LEONARD LUMBER REPORT: Futures experienced a very quiet, trendless trade last week

Recap:

Futures experienced a very quiet, trendless trade last week. Many are pointing to the Montreal gathering as the culprit, but it’s questionable whether any meaningful movement would have materialized regardless. May finished the week up $6, though total volume remained light throughout.

The only notable development came from the Commitment of Traders report, which showed another sizable jump in producer longs alongside a further increase in fund shorts. Overall, the best way to describe last week’s trade is simply uneventful.

The futures market managed to hold above a new low on this move, suggesting there is still underlying demand working its way through the pipeline. Given how firmly JIT buying is entrenched, that tension is always present, but today there appears to be a distinctly more spring‑like tone.

Much of the futures buying remains hedge‑related, with pending business waiting to surface. How and when that demand ultimately flows into the market is still uncertain. The key takeaway is that the marketplace continues to wrestle with supply concerns. Many remain uneasy that even a modest uptick in demand could quickly tighten conditions. For now, buyers are paying more than they’ve grown accustomed to.

Technical:

The reality of this trade is that for the past three years the market has needed an “event” to break it out of its narrow range and today is no different. There is still no data pointing to a meaningful pickup in demand. For futures to move materially higher, it would take a rally strong enough to trigger fund short covering.

With projected construction activity for Q2 and Q3 holding steady, there is little justification for a sharp selloff either. That said, if the algos or the funds lean back into the short side, prices could fall quickly. They don’t measure value — they simply sell.

The futures market saw a sharp selloff in February, followed by a solid recovery in March, though prices remained below the February highs. April is now showing signs of drifting back toward those February lows. As this illustrates, the market continues to trace a slow, uneven stair‑step lower. Historically, that type of pattern has been proven unreliable.

This may end up being a period where the cash market holds firm, while long futures hedges continue to take the brunt of the pressure.

 

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

17 Apr 2026
Agriculture, CME, Corn, Cotton, Crude Oil, 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: APRIL 2 – 17

Corn spent the start of April grinding lower, posting a fourth consecutive weekly loss by April 10th as the April WASDE reinforced a burdensome supply narrative. The USDA left U.S. ending stocks essentially unchanged at 2.127 billion bushels, the highest in seven years, and global stocks came in above trade expectations at 294.81 million metric tons. A two week ceasefire between the U.S. and Iran, announced April 7th, removed much of the war premium that had propped up prices since March, as easing Strait of Hormuz concerns pulled crude oil sharply lower and dragged corn along with it. July futures slid to a fresh four-week low near $4.40, completing a nearly 62% retracement from the March 9th highs. The past week saw stabilization and a modest recovery. Faster than expected planting progress, U.S. corn planting reached 5% completion as of April 13th, slightly ahead of last year’s pace, combined with firming eastern Corn Belt basis and Mexico securing a large forward purchase of 12.4 million bushels helped steady sentiment. The old crop market remains locked in a congestion zone between $4.45 and $4.55 on May futures, with the 200-day moving average serving as key support. Speculators have been trimming their long positions aggressively, as shown in the latest CFTC Commitment of Traders reports, leaving the market less vulnerable to a large liquidation event but also with less upside fuel until a fresh catalyst emerges as money allocators reposition to the equity markets.

Via Barchart

Soybeans have largely remained in a sideways grind, trading between $11.50 and $11.83 on July futures for most of the last 2 weeks. The April WASDE showed U.S. ending stocks unchanged at 350 million bushels with adjustments netting to zero, crush estimates raised while exports were trimmed by the same amount. The season-average price forecast was nudged 10 cents higher to $10.30 per bushel. Brazil’s CONAB raised its 2025/26 soybean production estimate again, this time to 6.582 billion bushels, keeping the global supply backdrop heavy and capping any sustained rallies. On the positive side, strong domestic crush margins, board crush pushing above $3 per bushel, have been the primary support story for the complex. NOPA March crush is expected to come in well above year-ago levels when reported. U.S. planting progress debuted at 6% complete as of April 13th, ahead of the 2% five-year average, with Mississippi and Tennessee leading at 39% and 36%, respectively. The market is waiting for a significant new headline to break out of the current range. Talks between President Trump and China’s President Xi, which were delayed amid the Iran conflict, remain a key watch item as any resumption of Chinese buying interest could quickly change the demand narrative for U.S. soybeans.

Via Barchart

Wheat has done better the last couple of weeks, with Kansas City HRW futures rallying on the back of deteriorating U.S. crop conditions and persistent drought in the Southern Plains. USDA’s April 14th crop progress report showed just 34% of the winter wheat crop rated good-to-excellent, down a full 13 percentage points from a year ago, with 32% of the crop rated poor or very poor. Oklahoma and the Texas Panhandle remained in severe to extreme drought, and the recent widespread rain systems have largely missed the driest areas. Concerns about the long-term fertilizer supply disruptions caused by the Iran conflict have added a structural premium, with funds holding a record long position in spring wheat and a growing net long in Kansas City HRW. July HRW futures jumped nearly 20 cents on April 14th alone, reaching their highest settlement since March 31st at $6.36. Chicago SRW July futures also pushed above $6.00. The market sold off modestly to end the week but held the bulk of its gains. Longer-range forecasts suggest late April could bring more favorable moisture to parts of the Plains, which could temper upside. For now, weather, drought maps, and the weekly crop condition ratings are the primary price drivers.

Via Barchart

Equity Markets

Equity markets have moved from deep stress to new record highs over this two-week stretch, tracking the Iran ceasefire developments closely. When Trump announced the two-week pause in operations on April 7th, the Dow Jones Industrial Average surged 1,325 points, its best single session since April 2025, while the S&P 500 gained 2.5% to 6,782. Through the balance of the period, stocks continued recovering as investors grew increasingly optimistic about a lasting peace deal, with the S&P 500 recouping all losses accumulated since the start of the conflict. The run to new highs has been impressive with the NASDAQ having a positive day for 14 straight days.

Via Barchart

Energy Markets

Energy markets have continued to be volatile over the past couple of weeks but the news of ceasefire and opening of the Strait of Hormuz. While the cease-fire does not mean the conflict is over, if good news continues to come out of Washington oil prices will fall. The ceasefire dynamics have already meaningfully reduced fertilizer cost fears and energy-linked inflation expectations.

Via Barchart

Other News

  • Cotton has been one of the most compelling commodity stories of the period, with July futures pushing to a nearly two-year high and new crop cotton reaching $0.80 in the Dec contract. The move has been supported by a combination of bullish factors: elevated crude oil prices increasing polyester production costs and driving synthetic fiber substitution back toward natural cotton, a weaker U.S. dollar, and persistent drought in key U.S. growing regions stretching from the Texas Panhandle westward. The USDA April WASDE raised global production by 900,000 bales while also lifting consumption by 560,000 bales, leaving the net balance slightly tightened.
  • USDA’s April WASDE raised the season-average farm price for wheat 5 cents to $5.00/bu, corn 5 cents to $4.15/bu, and soybeans 10 cents to $10.30/bu.
  • The Trump administration called out fertilizer giant Mosaic for idling two Brazilian plants, with Deputy Agriculture Secretary Stephen Vaden publicly questioning the timing as global fertilizer supplies face war-related disruptions.
  • A new survey found that only 60% of U.S. corn farmers have secured their nitrogen needs for the 2026 crop year, a reflection of the input cost uncertainty created by the Iran conflict.
  • Brazil’s CONAB raised its 2025/26 total corn crop estimate to 139.6 MMT (5.5 billion bushels), maintaining a heavy Southern Hemisphere supply backdrop.

 

Drought Monitor

Here is the most recent drought monitor. With planting starting later this spring, we need rain in a lot of places in March.

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.

13 Apr 2026
Agriculture, CME, Futures, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: Futures finished the week down $21

Recap:

Futures finished the week down $21. One notable development was in the COT report showing an increase of 924 industry longs. That puts the long hedge position at roughly 1,600 cars. That represents a meaningful amount of protection in place and should help dampen anxiety during periods of volatility. At the same time, short funds added 595 contracts, remaining committed to the lumber futures trade.

In a low-volume environment, positioning matters. The industry is actively managing risk by using futures to step away from the daily cash-market grind, while the funds continue to stay with a trade that has worked. Who is hedged—and who is pressing—will matter more as liquidity thins.

Unlike the October/Now NAWLA meetings, which often end with traders going gangbusters, the Montreal convention usually goes out with more of a whimper. That is largely seasonal. As the calendar turns toward May, near‑term needs begin to fade, and most buyers have already covered requirements for a while. The shift toward JIT purchasing changed that dynamic somewhat, but only at the margins.

In short, the discount should cap the selloff, but the overall tone suggests the market is waiting for the next buy program to emerge.

 

Technical:

Momentum indicators are negative. The futures market is struggling to keep them positive. What I have noticed is that the trendlines are trending lower. The market is walking the support and resistance lines down each cycle. Each time futures trade above the resistance line, it is followed by a sharp break. Today, the industry is using those breaks to hedge future needs. It becomes an efficient derivative tool, and that creates neutrality.

 

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

06 Apr 2026
Agriculture, CME, Futures, Hedging, Housing, Lumber, Market Commentary, Market Updates, Research, Risk Management, Weekly Prices rcmagserv 0 comment

LEONARD LUMBER REPORT: THE FATIGUE FACTOR

Recap:

The fatigue factor. A lumber cycle only has so much life. An upcycle runs about 15 sessions before needs are met. A down cycle tends to last longer. The consumption factors are slow-moving, causing a longer lag until the next buy. Last week, we saw futures making what I would call a triple top and then failing. It was a sign of fatigue. The cash market is also struggling to keep up momentum. It is too early to call for a change in cycle direction, but it does give a reason to hedge a little. 

We are starting each week with the same fundamental issue: trying to predict the macro trend. It is easy to say that we are in an upcycle in the micro picture, but we haven’t been able to call the macro down cycle finished. We are fence-sitting, poised for higher prices caused by less supply, not better demand. Consistent data shows less supplies coming out of Canada. It would not take much to put us in an undersupplied market. A slight downtick in rates would start to set it up. Today, the market has the war and crude to contend with. All other factors are pushed to the sidelines. The fact that housing inventories are at a high level and rates are grinding higher will keep construction in check.  

What is troubling is that since last July, every upcycle has made a lower high.  This comes at a time when production out of Canada is being reduced. This fact, more than any other, highlights the affordability issue. Demand is flat. There is never enough of an increase in sales to bring about an uptick in construction. The 2026 plans remain in place.

Trading:

The supply issue has caused the JIT buyer to chase the market. The rule is to carry inventory in a supply-driven market.

The demand issue warrants hedging of the excess inventories. No one today will do a $30 basis trade, but if futures go to a discount, the true basis is higher. We believe that the underbought condition of the housing sector should firm our trading range up, but the rules are to be hedged in a downcycle regardless. 

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

02 Apr 2026
Agriculture, CME, Corn, Cotton, 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: MARCH 20 – APRIL 2

Corn has remained supported but volatile following the March 31st USDA Prospective Plantings and Quarterly Stocks reports, which reinforced a tighter-than-expected balance sheet narrative. The USDA came out with 95.338 million acres, near the lower end of trade expectations, confirming earlier concerns that higher input costs, particularly fertilizer due to war in Iran, would limit corn expansion, while stocks data did not show burdensome supplies. This has helped underpin prices despite sluggish export demand and limited Chinese participation, keeping the market more focused on supply risk than demand weakness. Combined with continued strength in energy markets and inflation-driven fund interest, corn remains in a supportive environment, though the large speculative long position leaves it vulnerable to sharp downside if macro sentiment shifts.

Via Barchart

Soybeans have struggled to find sustained strength even after the March 31st USDA reports, which confirmed expectations for increased U.S. acreage and relatively comfortable stocks levels. The larger planting outlook reinforces the idea of ample new crop supplies, especially when paired with ongoing pressure from South America’s record production. While periodic rallies have been driven by energy market spillover and inflation concerns, the lack of consistent export demand, particularly from China, and fading optimism around biofuel policy have kept the market defensive. Overall, the USDA data solidified a more bearish supply outlook, leaving soybeans reliant on external market strength rather than supportive fundamentals. Talks between president Trump and China’s president Xi will be watched under a microscope if they end up happening after already being delayed with the conflict in Iran continuing.

Via Barchart

Energy Markets

Energy markets have continued to dominate the macro landscape, with crude oil holding elevated and volatile levels as geopolitical tensions involving Iran persist and uncertainty around the Strait of Hormuz remains unresolved. The sustained strength in energy has amplified inflation concerns globally, driving investment flows into commodities and influencing planting decisions, input costs, and overall sentiment across agricultural markets.

Via Barchart

Equity Markets

Equity markets have remained under pressure since late March, as the combination of higher energy prices and the inflationary implications highlighted in recent economic data have weighed heavily on investor sentiment. The indexes continues to reflect a risk-off environment, with concerns centered on slowing economic growth, tighter margins from rising input costs, and ongoing geopolitical uncertainty overshadowing otherwise stable underlying economic conditions.

Via Barchart

Other News

– Cotton acres in the prospective plantings report were 9.64 million for 2026, a 4% increase from last year.

– All wheat acres from the report were 43.8 million acres, down 3% from 2025.

Drought Monitor

Here is the most recent drought monitor. With planting starting later this spring, we need rain in a lot of places in March.

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.

 

 

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