WHEAT

General Comments: Wheat closed a little higher on what was reported to be speculative buying. Trends are still sideways in all three markets. Speculators were the best sellers on more news that a new Covid variant has been discovered in Africa. Reports indicate that the virus spreads rapidly but produces mild symptoms and this news caused buying yesterday. European nations were also starting to lock down again as the virus resurges there. Demand ideas got hurt over the last several days. Ideas have 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 against previous years. Offer volumes are down from both Russia and Europe although there has been talk of increased offers from Russia.  Dry weather in southern Russia as well as the northern US Great Plains and Canadian Prairies caused a lot less production and are still supporting the market. The lack of production has reduced the offers and Russia plans to announce sales quotas for next year very soon. Russia has already increased export taxes to control the flow of export Wheat out of the country. Australia has had too much rain and the crop quality has been much diminished, but conditions are drier now and the harvest is moving ahead. These international moves should increase demand for US Wheat but this has not really happened yet. 

Overnight News: The southern Great Plains should get mostly dry conditions or isolated showers. Temperatures should average above normal. Northern areas should see isolated showers. Temperatures will average above normal. The Canadian Prairies should see mostly dry conditions but some scattered showers on Wednesday and Thursday. Temperatures should average below normal.

Chart Analysis: Trends in Chicago are mixed. Support is at 790, 783, and 776 March, with resistance at 824, 845, and 847 March. Trends in Kansas City are mixed. Support is at 807, 789, and 779 March, with resistance at 850, 873, and 885 March. Trends in Minneapolis are mixed. Support is at 1001, 991, and 979 March, and resistance is at 1047, 1056, and 1058 March.

Photo by Mathilde Ro on Unsplash

RICE

General Comments: Rice was a little lower yesterday from follow-through selling caused by the reports of the new variant of the Covid found in Africa.  The variant is supposed to spread rapidly but be mild in its effects.A return of the Coronavirus to Europe and the discovery of a new variant in Africa gave the market some big problems to work though and speculators have apparently decided to reduce risk in the last week. Traders were also preparing for the next round of WASDE reports that will be issue on Thursday. Futures have held some important support areas on the daily and weekly charts and are trying to move higher again. Many producers are done harvesting and are hunting and not interested in selling at a time that is traditionally the cheapest prices of the year. The cash market is reported to be relatively strong. 

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

Chart Analysis: Trends are mixed. Support is at 1400, 1394, and 1387 January and resistance is at 1423, 1444, and 1451 January.

CORN AND OATS

General Comments: Corn closed near unchanged in recovery trading and trends are mixed on the daily charts. Futures had been much weaker to start the day. The recent downtrends were caused by Coronavirus fears as parts of Europe are locking down due to a resurgence of the virus and as a new variant was reported in Africa. The weekly charts still suggest higher prices are coming longer term and the fundamentals do as well. Corn has relatively tight supplies as farmers are mostly done harvesting and not selling. Demand will be an increasing feature in the trade moving forward as the harvest moves to completion sometime this month. Demand has been good so far this season but a lot of business has gone to Ukraine this Fall. That is expected to change over the Winter as Ukraine exportable supplies start to run low. Interior basis levels are reported to be strong due to strong demand. There are a lot of ideas that production and planted and harvested area will be significantly less next year due to the lack of fertilizers available and the cost of production.

Overnight News:

Chart Analysis: Trends in Corn are mixed. Support is at 576, 572, and 563 March, and resistance is at 589, 594, and 597 March. Trends in Oats are mixed. Support is at 711, 696, and 690 March, and resistance is at 739, 746, and 771 March.

SOYBEANS

General Comments: Soybeans and Soybean Meal closed lower in consolidation trading and the trends are now mixed. Soybean Oil closed higher on the price action in competing oils and Crude Oil. Traders were starting to prepare for the WASDE reports that will be released on Thursday. The recent downtrends were primarily caused by Coronavirus fears that have returned to the market. Harvest is about over for Soybeans and a harvest low might have been hit this week. Reports indicate that farmers are limited sellers at best. Planting and initial crop development is going very well in Brazil but it has turned dry in southern Brazil and Argentina and some weather-related support is coming to the futures market. Brazil could have soybeans ready for export by the end of February and the crop potential is up to 150 million tons. 

Overnight News:  Unknown destinations bought 123,00 tons of US Soybeans.

Chart Analysis:  Trends in Soybeans are mixed. Support is at 1254, 1243, and 1237 January, and resistance is at 1281, 1289, and 1292 January. Trends in Soybean Meal are mixed. Support is at 348.00, 344.00, and 338.00 January and resistance is at 360.00 362.00, and 363.00 January. Trends in Soybean Oil are mixed. Support is at 5670, 5610, and 5520 January, with resistance at 5830, 5870, and 5950 January;

CANOLA AND PALM OIL

General Comments: Palm Oil closed higher today. Improved export demand is reported but still faces headwinds due to the worldwide Covid outbreak along with worries about demand. Futures are now at the lower end of the range. Reports of new lockdowns in Europe and a new variant of the Coronavirus discovered n Africa hurt demand ideas on Friday and caused speculative selling to reduce risk. Support still comes from ideas that supply and demand are in balance or supplies are short. There are ideas of tight supplies due to labor problems. There are just not enough workers in the fields due to Coronavirus restrictions. Production has also been down to more than offset the export losses so prices have trended higher. Canola was a little higher along with price action in Chicago Soybean Oil and on the Coronavirus news and its potential effects on demand. Farmers are bullish and reluctant to sell because of the sharp reduction in Canola production in Canada this year. However, competing oils are down hard and Canola needed to fall as well.

Overnight News:

Chart Analysis: Trends in Canola are mixed. Support is at 1010.00, 997.00, and 976.00 January, with resistance at 10344.00, 1050.00, and 1056.00 January. Trends in Palm Oil are down with objectives of 4390 February. Support is at 4740, 4680, and 4540 February, with resistance at 4830, 4850, and 4920 February.

Midwest Weather Forecast: Mostly dry but some precipitation is likely about Thursday. Temperatures should average near to below normal.