Grains Report - Thursday, March 26

WHEAT:

General Comments: Wheat markets were higher yesterday with fund buying in Chicago RW markets the main feature. The Coronavirus and stay at home orders in many states have created a rush of buying of Wheat products and have caught the mills short bought. They have been very active in buying Wheat in domestic cash markets, especially in the Great Plains, and bases levels have moved sharply higher. There was a lot of bullish demand news for the market to absorb. There is also the chance for production losses in areas near the Black Sea from freezing temperatures on ground with no snow cover. It remains dry in parts of Russia. No one is talking about losses in Russia yet, but the situation should be monitored as losses will become very possible unless it starts to rain soon.
Overnight News: The southern Great Plains should get showers and rains on Friday and Saturday. Temperatures should be variable. Northern areas should see light precipitation in southern areas the rest of the week and a dry weekend. Temperatures will average near to above normal. The Canadian Prairies should see mostly dry conditions. Temperatures should trend to near to above normal.
Chart Analysis: Trends in Chicago are up with no objectives. Support is at 568, 562, and 547 May, with resistance at 591, 598, and 604 May. Trends in Kansas City are up with no objectives. Support is at 491, 479, and 476 May, with resistance at 512, 518, and 5024 May. Trends in Minneapolis are up with objectives of 548 and 563 May. Support is at 535, 528, and 519 May, and resistance is at 545, 550, and 558 May.

RICE

General Comments: Rice was higher on strong domestic demand and improving export demand ideas. Vietnam said it was suspending exports and India might have to do the same thing due to the Coronavirus. India is traditionally the low-priced seller into the world market so their potential withdrawal could mean a big rally is coming. The domestic situation remains tight and sales to western countries have been generally good although not so strong in recent weeks. Some producers are selling the next crop and some significant hedge selling has been seen in new crop months in futures. Demand for US Rice remains generally positive and the export sales pace in general has been very good. It has been weaker lately due to the higher prices.
Overnight News: The Delta should get showers and storms. Temperatures should be above normal.
Chart Analysis: Trends are mixed to up with objectives of 1373 and 1406 May. Support is at 1339, 1316, and 1306 May, with resistance at 1368, 1380, and 1398 May.

CORN AND OATS

General Comments: Corn closed higher on US Dollar weakness and somewhat higher Crude Oil prices. The US stock market was sharply higher. Prices for Crude Oil and also gasoline and heating oil are at extremely low levels right now. The Saudis are using the cheaper price to punish Russia for balking at cutting production a few weeks ago but also to eliminate competition from shale oil producers in the US and Canada as well as bio fuels producers around the world. The Saudi moves have helped to destroy the Corn market here in the US. It has turned into a disastrous situation and one for which the US government has no real answers to give Corn producers here.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 345, 338, and 332 May, and resistance is at 353, 357, and 364 May. Trends in Oats are mixed. Support is at 258, 252, and 248 March, and resistance is at 274, 278, and 282 May.

SOYBEANS AND PRODUCTS

General Comments: Soybeans closed mixed and Soybean Oil closed higher. Soybean Meal closed lower. Little or no ethanol production means little or no production of DDG as well, so a potential competitor to Soybean Meal in domestic and world markets has been effectively removed. Logistical problems caused by the Coronavirus in South America also played a major role in the rally. Argentina and Brazil closed borders to traffic last week. Exports are not supposed to be affected, but there are signs that transportation inside the countries has become very difficult. For example, one port town in Argentina has closed itself off to all port traffic including trucks bringing Soybeans and products to the port. The US is still selling and shipping normally and has gained the upper hand for any loads China or anyone else might need to buy. Chinese Soybean Meal users have indicated that the market is very short the product right now and that prices are increasing. The move comes even with the US Dollar index at extremely high levels against major world currencies and against the Real and Peso. The US is still the best and most reliable shipper and is expected to capture a lot of business going forward.
Overnight News:
Chart Analysis: Trends in Soybeans are up with objectives of 916 and 937 May. Support is at 872, 867, and 855 May, and resistance is at 897, 900, and 904 May. Trends in Soybean Meal are mixed to down with objectives of 3125.00 and 202.00 May. Support is at 314.00, 311.00, and 307.00 May, and resistance is at 327.00, 336.00, and 337.00 May. Trends in Soybean Oil are mixed to up with no objectives. Support is at 2570, 2530, and 2470 May, with resistance at 2700, 2760, and 2830 May.

CANOLA AND PALM OIL

General Comments: Canola was a little lower. Trends are mixed on the daily charts. Palm Oil was lower on speculative profit taking and on currency considerations.
Overnight News:
Chart Analysis: Trends in Canola are mixed to up with objectives of 433.00 May. Support is at 453.00, 451.00, and 444.00 May, with resistance at 470.00, 473.00, and 475.00 May. Trends in Palm Oil are mixed to up with objectives of 2600 and 2810 June. Support is at 2300, 2270, and 2190 June, with resistance at 2480, 2520, and 2530 June.