Wheat

General Comments: Wheat markets were lower yesterday in response to another week of poor exports. The USDA reports were bearish for prices. There remains selling tied to uncertainty about exports from the Black Sea and on bad growing conditions in the western Great Plains, where it remains very hot and dry with little or no relief in sight. Turkey and Russia are talking together about their own plan for exports from the Black Sea and are no including the UN in the talks. Russia has said that the current system cannot last. Trends are turning down on the daily charts. Ideas that big Russian offers and cheaper Russian prices would be a feature for a while in the world market was the driving force for the weaker prices. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. The demand for US Wheat in international markets has been a disappointment all year and has been hindered by low prices and aggressive offers from Russia.
Overnight News: The southern Great Plains should get mostly dry conditions. Temperatures should be above normal. Northern areas should see mostly dry conditions. Temperatures will average above normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average above normal.

Chart Analysis: Trends in Chicago are mixed to down with objectives of 645 and 602 May. Support is at 654, 648, and 642 May, with resistance at 686, 692, and 712 May. Trends in Kansas City are down with objectives of 835, 830, and 809 May. Support is at 840, 813, and 810 May, with resistance at 853, 864, and 871 May. Trends in Minneapolis are down with objectives of 840, 827, and 823 May. Support is at 846, 833, and 827 March, and resistance is at 875, 887, and 899 May.

Rice:

General Comments: Rice was a little lower yesterday in consolidation trading and after a couple of days of buying tied to the USDA WASDE estimates released Tuesday. Trends are up on the May daily charts. Futures have been in a massive move lower for the past week, but that changed once USDA released its new supply and demand estimates that called for less imports and bigger domestic and export demand for all Rice and especially Long Grain. Medium and short grain estimates were unchanged but ending stocks for long grain dropped by 6.0 million cwt as did the ending stocks estimates for all Rice. The moves shocked the market and futures went from slight gains to big gains. Demand has been good from domestic sources and offers seem hard to find right now. Export demand has been uneven and was low last week. Export demand has been an issue for the market all year. Mills are milling for the domestic market in Arkansas and are bidding for some Rice. Markets from Texas to Mississippi are called quiet. Demand in general has been slow to moderate for Rice for exports. Planting remains active in Texas and southern Louisiana with field conditions called very good in Louisiana and too dry in parts of Texas.

Overnight News: The Delta should get scattered showers. Temperatures should be above normal.

Chart Analysis: Trends are up with objectives of 1805 May. Support is at 1734, 1715, and 1700 May and resistance is at 1760, 1772, and 1778 May.

Corn and Oats:

General Comments: Corn and Oats closed lower yesterday, with Corn suffering from a weaker than expected export sales report from USDA. The weather is dry and warm in the Midwest and producers are concentrating on fieldwork and are not selling Corn, but the market wants Corn now. WASDE estimates released on Tuesday showed unchanged ending stocks levels for Corn, but the market had anticipated a reduction in ending stocks to account for the less than expected quarterly stocks estimates released a couple of weeks ago. Instead, USDA cut imports and food demand by 10 million bushels each to leave the stocks unchanged. US prices are currently very competitive with those from South America as Brazil concentrates on Soybeans exports and not Corn and US demand has improved because of the price differentials and the lack of a Brazil offer into the market. This trend should continue for the next few months if not longer. Prices from South America should now remain strong as countries there concentrate on Soybeans exports and not Corn. NOAA is forecasting that La Nina will develop this Summer and replace El Nino. US growing conditions are usually good when this happens.

Overnight News: China bought 382,000 tons of US Corn.

Chart Analysis: Trends in Corn are mixed. Support is at 647, 640, and 628 May, and resistance is at 662, 672, and 682 May. Trends in Oats are down with objectives of 320, 317, and 305 May. Support is at 328, 315, and 310 May, and resistance is at 338, 348, and 353 May.

Soybeans:

General Comments: Soybeans and Soybean Meal were higher yesterday, with demand ideas for US Soybeans supporting nearby months but good Midwest weather hurting new crop months. Soybean Oil was lower. Ideas for the WASDE reports from USDA were for lower ending stocks, but USDA on Tuesday left ending stocks unchanged and made no changes to supply or demand. Reports from Brazil show that basis levels there are under pressure due to the large crop being harvested now. The basis might get higher later in the marketing period as total South American production is probably about the same as last year. Brazil has a very good crop, but the additional Soybeans grown in Brazil will be wiped out by the losses in Argentina. Argentina has been forced to import from Brazil to keeps its crushing facilities operating. Soybeans export demand is flowing to Brazil now. It remains hot but rains are reported in Argentina and crop conditions are getting stable. Forecasts from NOAA for very good growing conditions in the Midwest were also a factor, but there is too much rain in most growing areas right now.

Overnight News: /

Chart Analysis: Trends in Soybeans are mixed to up with no objectives. Support is at 1500, 1483 and 1471 May, and resistance is at 1528, 1532, and 1544 May. Trends in Soybean Meal are mixed to up with objectives of 476.00, 487.00, and 516.00 May. Support is at 455.00, 446.00, and 425.00 May, and resistance is at 470.00, 475.00, and 485.00 May. Trends in Soybean Oil are mixed to down with objectives of 5090, 5050, and 4790 May. Support is at 5130, 5000, and 4880 May, with resistance at 5540, 5630, and 5810 May.

Canola and Palm Oil:

General Comments: Palm Oil closed lower today on the price action in Chicago Soybean Oil and strength in the Riggit. Trends are mixed on the daily charts despite news that OPEC was cutting oil production again. There are ideas are that prices can remain elevated due to bad weather in Malaysia but demand remains weaker than hoped for from India and China. Indonesia has not been offering as it tries to build stocks for its own bio fuels industry but it is expected to start offering very soon. Canola was lower yesterday on price action in Chicago and as planting and fieldwork delays are passing in favor of warmer and drier weather that is allowing producers to get into the fields. Forecasts are for warmer weather to show up in the Prairies this week could start to allow for fieldwork to start. Brazil is expected to dominate the oilseeds market for the next few months. Reports indicate that domestic demand has been strong due to favorable crush margins.

Overnight News: /

Chart Analysis: Trends in Canola are mixed. Support is at 756.00, 745.00, and 733.00 May, with resistance at 781.00, 789.00, and 798.00 May. Trends in Palm Oil are down with objectives of 3650 June. Support is at 3700, 3680, and 3610 June, with resistance at 3810, 3870, and 3910 June.

Midwest Weather Forecast: Mostly dry conditions. Temperatures should average above normal.

More By This Author: