Grains Report - Wednesday, July 6

General Comments: Wheat markets were much lower yesterday as funds and other speculators were sellers. They fear a deflationary situation here and around the globe and also fear that a recession is coming. Demand remains poor for US Wheat. The Winter Wheat harvest is expanding through the Great Plains and Midwest. Trends are down in all three markets. Futures had a negative reaction to the quarterly stocks reports and also the planted area reports. Both showed figures that were a little above trade expectations with the quarterly stocks just above the trade guess at 660 million bushels and the planted area reports also just above the average trade guess at 47.1 million acres. The weekly export sales report sowed bad demand for US Wheat once again. Futures should form a harvest low earlier in the harvest due to the small crop size. Yield reports have been weakening in Kansas despite recent rains that have helped kernel size and test weight. Hot and dry weather is back for this week to southern areas while northern areas have more moderate weather. Northern Plains and Canadian Prairies weather has been improved but is still variable. Europe is too hot and dry and India and Pakistan are both past major heat waves and dry conditions.
Overnight News: The southern Great Plains should get mostly dry conditions or isolated showers. Temperatures should average above normal. Northern areas should see isolated to scattered showers. Temperatures will average near to below normal. The Canadian Prairies should see isolated to scattered showers. Temperatures should average near to above normal.
Chart Analysis: Trends in Chicago are down with no objectives. Support is at 790, 778, and 770 September, with resistance at 839, 896, and 900 September. Trends in Kansas City are down with no objectives. Support is at 845, 821, and 801 September, with resistance at 875, 916, and 942 September. Trends in Minneapolis are down with no objectives. Support is at 877, 868, and 852 September, and resistance is at 922, 938, and 965 September.

variety of assorted-color beans

Image Source: Unsplash

General Comments: Rice was lower yesterday on what appeared to be fund selling tied to ideas of a weak economy and fears about a recession. The US Dollar was sharply higher and helped to promote weak demand ideas for Rice. USDA said that 2.343 million acres of all Rice were planted and that current stocks are now 56.6 million cwt. Both levels are below those of a year ago and should have been considered neutral to positive for prices. The speculators have been the best sellers lately even with perceived bullish fundamental news as many are worried about a world wide recession. The weekly export sales report showed poor demand. Growing conditions are said to be deteriorating due to hot and dry weather in Texas expanding to include Arkansas.
Overnight News: The Delta should get mostly dry conditions. Temperatures should be above normal.
Chart Analysis: Trends are down with objectives of 1603 and 1543 September. Support is at 1604, 1591, and 1578 September and resistance is at 1637, 1663, and 1692 September.

General Comments: Corn closed lower in response to world economic concerns. Funds and other speculators fear that a world wide recession is coming. The US Dollar was sharply higher yesterday and Crude Oil and the stock markets were lower.. The USDA reports showed more supplies on hand at 4.346 billion bushels and more planted area at 89.9 million acres than trade expectations. The weekly export inspections report showed poor demand. Corn has emerged under what is considered good conditions but it has been hot in the Midwest and many areas have been dry. More moderate temperatures are forecast for the weekend, but then some forecasts call for hot and dry weather to return while others suggest more normal rainfall. Continued hot and dry weather could hurt yields down the road. Stress could start to develop if the hot and dry weather returns as forecast. Many think the top end of the yield has been taken off the Corn crop due to the delayed planting but others look at the crop condition rating and expect improved yields.
Overnight News:
Chart Analysis: Trends in Corn are down with no objectives. Support is at 577, 571, and 562 September, and resistance is at 619, 645, and 654 September. Trends in Oats are down with objectives of 440 September. Support is at 465, 460, and 456 September, and resistance is at 493, 509, and 522 September.

General Comments: Soybeans and the products were sharply lower again yesterday as warm and dry weather invades the US and as demand concerns hurt for both markets. A lot of the selling came from the funds and other speculators on fears of a world recession in the short term. USDA found much higher quarterly stocks than anticipated by the trade at 971 million acres but found less planted area than trade expectations at 88.3 million acres. The weekly export inspections report showed poor demand for Soybeans. US cash market is still running low on Soybeans but there are still renewed Chinese lockdowns. There is less Chinese demand for Soy products due to the lockdowns there and China is starting to renew the lockdowns now as Covid cases have risen in number. China has been a major buyer of US Soybeans this year after a very slow start due to the problems in South America. They are buying for this year and already have booked a large amount of new crop Soybeans to cover future needs. Most of the current buying is for next year.
Overnight News:
Chart Analysis: Trends in Soybeans are down with objectives of 1436 and 1320 August. Support is at 1432, 1414, and 1402 August, and resistance is at 1495, 1505, and 1531 August. Trends in Soybean Meal are mixed. Support is at 407.00, 401.00, and 398.00 July, and resistance is at 420.00 426.00, and 431.00 August. Trends in Soybean Oil are down with objectives of 6490 and 5880 August. Support is at 5910, 5770, and 5680 August, with resistance at 6440, 6500, and 6570 August.

General Comments: Palm Oil closed lower on weakness in Crude Oil futures and ideas of increasing supplies in Malaysia. Export reports from the private sources are showing the weaker demand this month and this has been the trend for the last few months. Production from Malaysia is expected to increase as well as the Covid lockdowns finally go away and as the weather is good for production. Canola was lower along with other vegetable oils markets. Ideas of poor demand have hit this market as well as the others. The crops are going in the ground and the growing conditions are much improved. It is reported to be very dry and has been cold for planting but better planting weather is coming now as it is now much warmer. There are ideas of reduced Sunflower export potential from Russia and Ukraine. The market is worried about South American production as well. Canada produced a very short crop of Canola last year so supplies are tight.
Overnight News:
Chart Analysis: Trends in Canola are down with objectives of 783.00 and 681.00 November. Support is at 791.00, 780.00, and 767.00 November, with resistance at 8654.00, 9885.00, and 913.00 July. Trends in Palm Oil are down with objectives of 3710 September. Support is at 4050, 4010, and 3930 September, with resistance at 4130, 4250, and 4400 September.

More By This Author:

Softs Report - Friday, July 1
Softs Report - Wednesday, June 29
Grains Report - Tuesday, June 28

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 ...

How did you like this article? Let us know so we can better customize your reading experience.


Leave a comment to automatically be entered into our contest to win a free Echo Show.