Grains Report - Monday, Jan. 24


General Comments:   Wheat markets closed lower as there was nothing new on renewed demand hopes as Russia is ramping up pressure on Ukraine and as a war becomes more possible.  But, there was no new news.  The Russian embassy will be staffed with only the minimum required personnel and all other workers there will be sent home.  Russia is escalating the crisis to test US and NATO resolve and a war is now more likely or at least some severe sanctions that could end the export programs for both Russia and Ukraine.  Futures are now trading at the upper end of the current trading range and could confirm a bottom has formed later this week.  The USDA reports released last Wednesday showed less domestic and export demand and higher than expected ending stocks levels.  The Wheat seedings report showed more than expected planted area, especially for Soft Red Winter.  It remains dry in the western Great Plains with no real relief in sight.  Ideas had been that the US will have good demand for Wheat as the rest of the northern hemisphere is short production this year but so far demand has been average or less against previous years.  Futures have been moving lower since late November because of the poor export demand and might be finding a bottom now.  Offer volumes are down in Europe.  Dry weather in southern Russia as well as the US Great Plains and Canadian Prairies caused a lot less production.  The lack of production has reduced the offers and Russia has announced sales quotas.  Australian crop quality should be diminished.

Overnight News:  The southern Great Plains should get mostly dry conditions or isolated showers.  Temperatures should trend from below to above normal.  Northern areas should see scattered showers. Temperatures will trend from below to above normal.  The Canadian Prairies should see mostly dry conditions or isolated showers.  Temperatures should average above normal in the west and below normal in the east.

Chart Analysis:  Trends in Chicago are mixed to up with objectives of 806 and 841 March.  Support is at 780, 771, and 758 March, with resistance at 808, 824, and 840 March.  Trends in Kansas City are up with no objectives.  Support is at 775, 761, and 744 March, with resistance at 808, 811, and 829 March.  Trends in Minneapolis are mixed to up with no objectives.  Support is at 933, 915, and 908 March, and resistance is at 965, 972, and 992 March.

Photo by James Baltz on Unsplash


General Comments: Rice was higher last week and made new contract highs for the March contract.  Trends are still up in the market.  The USDA reports showed less production and imports and smaller ending stocks.  Demand was trimmed as well, but the supply was cut more.  Futures and cash market trading have been quiet until now and the cash market is still quiet but domestic mill business is around everywhere.  Many producers are not interested in selling.  Mills are showing more interest in the market as previously bought supplies start to run low.  The cash market is reported to be relatively strong as prices have held firm and as activity increases.

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

Chart Analysis:  Trends are mixed to up with objectives of 1483 March.  Support is at 1453, 1437, and 1410 March and resistance is at 1483, 1488, and 1491 March.


General Comments:  Corn closed higher on Friday and higher for the week. USDA showed good export sales in the weekly report on Friday and rains have arrived to help dry soils in South America.   USDA a couple of weeks ago increased US Corn production by a little bit and did not cut Argentine and Brazilian Corn production estimates as much as it could have.  Demand was also trimmed on the domestic and export side. The markets heard about potential improvement in growing conditions in South America.  Central Argentina got the best rains again and the other areas were still dry or got significantly less rain.  Showers are now predicted for southern Brazil and the rest of Argentina and Paraguay and the situation there should become more stable.  Northern Brazil is expected to be drier to help with conditions there.

Overnight News:  Unknown destinations bought 150,000 tons of US Corn.

Chart Analysis:  Trends in Corn are up with objectives of 650 March.  Support is at 604, 600, and 585 March, and resistance is at 618 624, and 628 March.  Trends in Oats are mixed to up with objectives of 695 and 742 March.  Support is at 601, 590, and 582 March, and resistance is at 645, 666, and 677 March.


General Comments: Soybeans and the products closed higher on ideas of new demand as rains returned to dry soils in South America last week and are likely to continue. However, the benefits will be felt mostly in central Argentina and perhaps southern Argentina.  Showers are forecast for southern Brazil, Paraguay, and much of Argentina early this week as well.  New demand is now thought to come from China as rumors of new business with that destination hit the floor.  Soybean Oil was higher on price strength in Palm Oil and Crude Oil.  The rains last week mostly fell in northern Brazil with southern Brazil, much of Argentina, and Paraguay still mostly dry.  The drier areas are getting some precipitation now but central Argentina will get the best rains.  Only scattered showers are forecast for the other areas although conditions are slated to improve somewhat in all of the dry areas,  Trends are up on the daily and weekly charts.

Overnight News:  China bought 132,000 tns of US Soybeans. 

Chart Analysis:  Trends in Soybeans are up with objectives of 1486 March.  Support is at 1405, 1378, and 1369 March, and resistance is at 1437, 1444, and 1456 March.  Trends in Soybean Meal are mixed to down with objectives of 384.00 and 359.00 March.   Support is at 390.00, 385.00, and 380.00 March, and resistance is at 415.00 420.00, and 426.00 March.  Trends in Soybean Oil are up with objectives of 6290 and 6320 March.  Support is at 6140, 6000, and 5960 March, with resistance at 6380, 6500, and 6620 March.


General Comments:  Palm Oil was higher last week and moved to new contract highs.  Crude Oil made new highs and Indonesia is once again using its own Palm Oil to produce bio fuels and also announced plans to restrict exports to promote lower costs at home for cooking oil.  Futures were lower today on ideas of bad January exports.  There are still poor production conditions in Malaysia and Indonesia.  Traders are mostly worried about demand from India who has been buying Soybean Oil in the US instead of Palm Oil from Malaysia and Indonesia and is also worried about China and its demand for Palm Oil for bio fuels.  Production conditions have been very poor and workers are not often in the fields.  Canola was higher last week along with the price action in Chicago.  The rain in South America are no longer hurting Canola and Soybeans prices.  Farmers are bullish and reluctant to sell because of the sharp reduction in Canola production in Canada this year.  The buy side thinks that Canola is fully priced but the farmers are still holding out for more.  Chart trends are mixed for the daily charts.

Overnight News:

Chart Analysis:  Trends in Canola are mixed to up with objectives of 1040.00 and `1067.00 March.  Support is at 996.00, 983.00, and 977.00 March, with resistance at 1027.00, 1038.00, and 1040.00 March.  Trends in Palm Oil are up with no objectives.  Support is at 5200, 5110, and 5040 April, with resistance at 5360, 5420, and 5480 April.

Disclaimer: A Subsidiary of Price Holdings, Inc. – a Diversified Financial Services Firm. Member NIBA, NFA Past results are not necessarily indicative of future results. Investing in ...

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