Grains Report - Monday, March 27

wheat field

Photo by Polina Rytova on Unsplash


General Comments: Wheat markets were higher on Friday on ideas that prices have fallen enough for current demand fundamentals. Prices are now so cheap that Russia is reportedly thinking about increasing export tariffs or halting exports for a time to rally prices. Reports say that Russian offers continue to hit the world market and world prices. Trends turned sideways to up on the daily charts. The problem remains demand as world supplies are not so large and US inventories are less. Ideas that big Russian offers and cheaper Russian prices would be a feature for a while in the world market were the driving force for the weaker prices, and price weakness could continue. Prices are now so cheap that Russia is reportedly thinking about increasing export tariffs or halting exports for a time to rally 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 isolated showers. Temperatures should be near to below normal. Northern areas should see isolated showers. Temperatures will average below normal. The Canadian Prairies should see isolated showers. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 675, 654, and 648 May, with resistance at 712, 720, and 738 May. Trends in Kansas City are up with objectives of 866, 883, and 945 May. Support is at 843, 823, and 810 May, with resistance at 862, 866, and 878 May. Trends in Minneapolis are mixed to up with objectives of 847, 865, and 882 May. Support is at 846, 833, and 827 March, and resistance is at 869, 880, and 883 May.


General Comments: Rice was higher last week and trends are up on the charts. Speculative short covering was seen and ran into little selling interest. Demand has been good from domestic sources and offers to seem hard to find right now. Export demand has been uneven and was very low last week. 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 is active in Texas and southern Louisiana.
Overnight News: The Delta should get isolated showers. Temperatures should be below normal.
Chart Analysis: Trends are up with objectives of 1832 May. Support is at 1760, 1749, and 1724 May and resistance is at 1797, 1820, and 1831 May.

Corn And Oats:

General Comments: Corn closed higher last week on much-improved export demand as noted in recent weekly export sales reports from, USDA and US Dollar weakness. Demand from China has greatly increased in the last two weeks. The USDA export sales report was a marketing year high and the third highest sales amount in the last 20 years. Oats were higher and trends remain up in this market. US prices are currently very competitive with those from South America as Brazil concentrates on Soybeans exports and not Corn and US demand could improve because of the price differentials. Prices from South America should now remain strong as countries there concentrate on Soybeans exports, so the US has a chance now to see export demand improve. The Brazil Summer crop and the Argentine crop are developing under stressful conditions. It has been wet so the Soybeans harvest has been delayed and the Safrinha Corn planting is becoming delayed as well. These delays continue. Brazil sources say that 20% of the Winter crop could be planted outside of the ideal window so yields could be hurt in the end. NOAA is forecasting that La Nina will develop this Summer and replace El Nino. US growing conditions are usually good when this happens. However, it is very wet now and some early planting has been delayed.
Overnight News: Unknown destinations bought 112,800 tons of US Corn.
Chart Analysis: Trends in Corn are mixed to up with objectives of 651 May. Support is at 628, 625, and 623 May, and resistance is at 648, 652, and 660 May. Trends in Oats are mixed to up with objectives of 371 May. Support is at 356, 353, and 349 May, and resistance is at 369, 372, and 378 May.


General Comments: Soybeans products were higher on Friday, but lower for the week as the Brazil harvest makes it way to the market. Reports from Brazil show that basis levels there are under pressure due to the large crop being harvested now. However, the basis might get higher soon 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 keep its crushing facilities operating. 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. Soybean export demand is flowing to Brazil now. Argentina is the world’s largest exporter of Soybeans products while the US and Brazil battle for supremacy in Soybeans exports. It remains hot but rains are reported in Argentina and crop conditions are getting stable. Production ideas there are stable and the Rosario exchange now estimates production near 27 million tons. The Buenos Aires Grain Exchange said production could be 25 million tons. Weather is becoming less important now as the harvest is already underway in central and northern Brazil and is spreading south.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 1404 May. Support is at 1405, 1392 and 1380 May, and resistance is at 1439, 1455, and 1478 May. Trends in Soybean Meal are down with no objectives. Support is at 435.00, 422.00, and 405.00 May, and resistance is at 451.00, 454.00, and 461.00 May. Trends in Soybean Oil are down with objectives of 5050 May. Support is at 5150, 5000, and 4880 May, with resistance at 5500, 5600, and 5850 May.


Canola And Palm Oil:

General Comments: Palm Oil closed lower last week on weakness in Chicago and on-demand concerns 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 revoked some export permits to keep internal prices controlled and to support the biofuels industry. The controls are expected to last through Ramadan. Peninsular Malaysia has had bad weather. Canola was a little lower last week and trends are down. There was a price recovery in the second half of the week to make weekly losses rather minimal. There are some ideas that Canola's futures have fallen enough for now. 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 down with no objectives. Support is at 733.00, 8715.00, and 700.00 May, with resistance at 761.00, 747.00, and 772.00 May. Trends in Palm Oil are down with no objectives. Support is at 3410, 3320, and 3200 June, with resistance at 3720, 3750, and 3850 June.

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