Photo by James Baltz on Unsplash

WHEAT 

General Comments: Winter Wheat markets closed higher yesterday on spreading against Corn and Soybeans and as 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 average below normal.  Northern areas should see isolated showers. Temperatures will average below normal.  The Canadian Prairies should see mostly dry conditions.  Temperatures should average below normal.

Chart Analysis:  Trends in Chicago are mixed to down with objectives of 711 and 709 March.  Support is at 759, 736, and 714 March, with resistance at 771, 776, and 783 March.  Trends in Kansas City are mixed to down with objectives of  749 and 729 March.  Support is at 755, 751, and 747 March, with resistance at 783, 787, and 793 March.  Trends in Minneapolis are down with objectives of 871 March.  Support is at 906, 901, and 888 March, and resistance is at 948, 965, and 977 March.

RICE

General Comments: Rice was lower in consolidation trading as the market started to get ready for the USDA reports that will be released on Wednesday.  Futures and cash market trading have been quiet until now and the cash market is still quiet.  Many producers are not interested in selling.  Mills will show 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 despite the quiet activity.

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

Chart Analysis:  Trends are mixed.  Support is at 1450, 1443, and 1435 March and resistance is at 1466, 1475, and 1479 March.

CORN AND OATS

General Comments: Corn closed lower yesterday and the short term trends are sideways.  The markets heard about potential improvement in growing conditions in South America and was also preparing for the USDA reports that will be released on Wednesday.  Support came from ideas that the overall fundamental picture for Corn is bullish as dry conditions continue in South America have been affecting summer Corn and Soybeans production.  However, showers are now predicted for southern Brazil and the situation there should become more stable.  Northern Brazil is expected to be drier to help with conditions there.  Most of Argentina will stay hot and dry while Brazil gets its showers.  It is also hot and dry in Paraguay and into parts of southern Brazil.  Corn has relatively tight supplies as farmers are mostly done harvesting and not selling, but ideas are that farmers are delivering enough to keep the market satisfied.  Interior basis levels are reported to be strong.  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 but so far new crop futures have not been strong.

Overnight News:  

Chart Analysis: Trends in Corn are mixed.  Support is at 596, 592, and 585 March, and resistance is at 608, 611, and 6218 March.  Trends in Oats are mixed to down with objectives of 660 and 640 March.  Support is at 646, 633, and 627 March, and resistance is at 677, 680, and 694 March.

SOYBEANS 

General Comments: Soybeans and the products closed lower as the South American weather situation remains a mixed bag but is expected to improve. The rains over the weekend mostly fell in northern Brazil with southern Brazil, much of Argentina, and Paraguay still mostly dry.  Showers are now in the forecast for southern Brazil this week and in parts of Argentina next week. The rains are timely and will help crops in these areas.  The dry weather in southern Brazil and in Paraguay and Argentina had been helping to feed the rally and the forecasts took prices lower.  Central and northern Brazil might be too wet for Soybeans in at least some of these areas as Soybeans do not like very wet soils.  Reports indicate that some Corn has been lost and ideas are that Soybeans could become stressed if the dry weather continues in southern Brazil and northern Argentina.  Soybeans are also lost in the north.  Brazil could have soybeans ready for export by the end of February and the crop potential is up to 150 million tons although many are now starting to drop production outlooks due to the hot and dry weather.  Ideas are now that Brazil can produce between 130 and 145 million tons of Soybeans this year due to the losses in the south.

Overnight News:  Mexico bought 100,000 tons of US Soybeans. 

Chart Analysis: Trends in Soybeans are mixed.  Support is at 1370, 1368, and 1355 March, and resistance is at 1390, 1396, and 1408 March.  Trends in Soybean Meal are mixed to up with objectives of 432.00 and 449.00 March.   Support is at 414.00, 406.00, and 402.00 March, and resistance is at 437.00 438.00, and 444.00 March.  Trends in Soybean Oil are mixed.  Support is at 5750, 5690, and 5630 March, with resistance at 5980, 6000, and 6040 March.

CANOLA AND PALM OIL 

General Comments: Palm Oil was higher today on the MPOB data showing smaller than expected stocks levels.  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.  Canola was a little lower in range trading and with the Chicago price action.  It was a relatively narrow range day.  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.

Overnight News:

Chart Analysis: Trends in Canola are mixed to u[p with objectives of 432.00 and 449.00 March.  Support is at 1020.00, 1012.00, and 996.00 March, with resistance at 1038.00, 1040.00, and 1048.00 March.  Trends in Palm Oil are up with no objectives.  Support is at 4900, 4860, and 4800 March, with resistance at 5050, 5120, and 5180 March.