Grains Report - Wednesday, July 1

WHEAT
General Comments: Winter Wheat markets were higher but mostly in sympathy with the other markets. It looked to be a short-covering rally and there are some ideas that Winter Wheat market have made a seasonal bottom. Yield reports from the Great Plains have been variable, but generally a little better than expected. Spring Wheat was higher in sympathy with the price action in Chicago and despite ideas of good growing conditions and high crop ratings. Those ratings dropped this week in the weekly crop updates from USDA but are still very high. The Winter Wheat markets hold to bearish trends on the weekly charts. Spring Wheat markets show downtrends as good conditions are also reported in much of Canada. It remains dry in the western sections of the Great Plains but this will aid harvest progress now. Better rains are reported in Europe and Russia. Russia could turn hot and dry starting this week but soil moisture is good for now. Australia remains in good condition. Prices usually move lower and remain down through the harvest.
Overnight News: The southern Great Plains should get scattered showers. Temperatures should be near to below normal. Northern areas should see scattered showers. Temperatures will average near to above normal. The Canadian Prairies should see scattered showers. Temperatures should average near to above normal.
Chart Analysis: Trends in Chicago are mixed to up with objectives of 514 and 537 September. Support is at 489, 481, and 471 September, with resistance at 503, 512, and 515 September. Trends in Kansas City are mixed. Support is at 434, 424, and 418 September, with resistance at 446, 450, and 454 September. Trends in Minneapolis are mixed to down with objectives of 506 and 488 September. Support is at 516, 512, and 506 September, and resistance is at 522, 524, and 527 September.

RICE
General Comments: Rice was mostly a little lower. But July was sharply higher again USDA showed increased planted All Rice area at 2.921 million acres. The estimate was in line with trade expectations. USDA showed that the quarterly stocks were in line with trade expectations but still tight. The new crop continues to show progress under mostly good conditions. The combination of good export buying in general and the buying inside the US due to the Coronavirus has made the market short old crop Rice. This appears to be factored into the price as there are ideas that the mills are well covered into new crop, but little Rice is available from producers. The crops that got planted are in very good condition in the south and near the Gulf Coast but planting was more problematic in parts of Mississippi, Arkansas, and Missouri. Ideas are that the long grain got planted and producers did not plant medium grain if some prevent planting was needed.
Overnight News: The Delta should get isolated showers. Temperatures should be near to above normal.
Chart Analysis: Trends are mixed to down with objectives of 1186 September. Support is at 1212, 1203, and 1201 September, with resistance at 1230, 1241, and 1246 September.

CORN AND OATS
General Comments: Corn was higher on fund buying and on the USDA reports. The quarterly stocks report was negative but the planted area report was very bullish and the surprise of the market. USDA showed that only 92 million acres of Corn got planted, a historically wide variance from its March intentions report that showed planting intentions at 97 million acres. The weather was in the background but is generally considered good for the crops. Futures markets have had hot and dry weather in much of the Midwest last week to support prices, but there was some rain in most areas over the weekend. There have also been problems with demand. Meats processors are back and are operating at about 95% of capacity. The backlog of Cattle and Hogs will slowly disappear under this scenario and meats wholesale and retail prices are falling. Ethanol demand is also improving as lockdown orders are lifted in most states and in Europe. Some states are starting to pull back from opening up as the Coronavirus cases have greatly increased and a new pandemic or a continuation of the old one is feared. Demand for gasoline and ethanol has gotten a little stronger and should continue to improve over time.
Overnight News:
Chart Analysis: Trends in Corn are up with objectives of 355 September. Support is at 339, 332, and 326 September, and resistance is at 346, 350, and 356 September. Trends in Oats are mixed. Support is at 291, 286, and 283 September, and resistance is at 298, 301, and 304 September.

SOYBEANS AND PRODUCTS
General Comments: Soybeans were higher on the smaller than expected increase in planted area to Soybeans by US farmers. The quarterly stocks report was as expected. China has become a much more active buyer of Soybeans here in the US and has promised to ramp up purchases in order to comply with commitments it made under the Phase One trade deal. China has remained a very active buyer in South America even as it has increased Soybeans buying here in the US, so the overall amount taken from the US might not match the hopes of the trade. Brazil prices have been creeping higher for the rest of the world as it starts to run out of Soybeans to export, so China and the rest of the world will look to the US and Argentina for additional supplies. The US weather is considered good for growing Soybeans at this time with rains seen over the weekend and more again yesterday. USDA showed very good crop conditions again this week in its weekly update.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to up with objectives of 891 August. Support is at 878, 868, and 865 August, and resistance is at 884, 892, and 896 August. Trends in Soybean Meal are mixed. Support is at 286.00, 283.00, and 279.00 August, and resistance is at 290.00, 292.00, and 295.00 August. Trends in Soybean Oil are mixed. Support is at 2790, 2710, and 2680 August, with resistance at 2850, 2890, and 2910 August.

CANOLA AND PALM OIL
General Comments: Palm Oil closed higher on the strength in the outside markets. Higher world petroleum prices helped with ideas of increased bio fuels demand Palm Oil has been hoping for better demand from importers as world economies slowly open after being closed by the Coronavirus epidemic. Indonesia continues to focus its Palm Oil on internal demand for bio fuels. Canola was higher. Canola was higher on a weaker Canadian Dollar and Chicago price action The planted area estimates were above trade expectations but below the previous year. The weather has been warmer the past couple of weeks after weeks of cold and wet weather.
Overnight News:
Chart Analysis: Trends in Canola are mixed. Support is at 472.00, 470.00, and 468.00 November, with resistance at 480.00, 482.00, and 484.00 November. Trends in Palm Oil are mixed to down with objectives of 2290 September. Support is at 2290, 2250, and 2200 September, with resistance at 2370, 2430, and 2470 September.