Grains Report - Wednesday, May 20

WHEAT
General Comments: Wheat markets were mostly higher in fund-related buying. HRW markets were lower. Improving weather around the world and here at home was the big reason to see some selling hit the markets, but reports that Russia and Europe are turning dry again has supported the markets. The big negative for the market is still better weather for Europe and Russia. Europe got some rains after a prolonged dry spell and Russia also got a little rain in northern and central areas. The rains in Russia are leaving southern areas dry. These areas have turned dry again. The US Midwest has also seen a lot of rain and a bumper SRW crop is expected. It has been hot and dry in central and southern areas of the Great Plains. However, there is rain in the forecast for later this week. The crop suffered Winterkill first and now is suffering under the hot and dry weather. It has been mostly dry but cold in the northern Great Plains and into the Canadian Prairies but the market is less concerned about production potential for Spring Wheat crops. Warmer and drier weather is expected this week.
Overnight News: The southern Great Plains should get scattered showers. Temperatures should be near to above normal. Northern areas should see dry conditions this week and scattered showers this weekend. Temperatures will average above normal. The Canadian Prairies should see scattered showers. Temperatures should average below normal in the west and above normal in the east.
Chart Analysis: Trends in Chicago are down with objectives of 492 and 468 July. Support is at 494, 488, and 482 July, with resistance at 506, 508, and 513 July. Trends in Kansas City are down with objectives of 436 and 418 July. Support is at 439, 431, and 428 July, with resistance at 450, 457, and 468 July. Trends in Minneapolis are mixed. Support is at 502, 497, and 491 July, and resistance is at 514, 517, and 526 July.

RICE
General Comments: Rice was a little lower in consolidation trading. The fundamentals are mostly the same and unchanged for the last few weeks. The domestic situation remains tight for the old crop months and the funds have been buying. New crop months have reflected ideas of greatly increased planted area from producers. Some producers are selling the next crop and some hedge selling has been seen in new crop months in futures but this has dried up as Arkansas has been cool and wet for planting. Planting should be active again this week in the state and northern sections of the state are reported to be planted already. Mississippi has also had problems planting the crop due to too much rain but the crop is being planted. Demand for US Rice remains generally positive and the export sales pace, in general, has been very good. However, they were a marketing-year low last week at about 28,000 tons. The weekly crop progress reports showed that southern Rice is emerging well. Rice in Texas and Louisiana is in flood.
Overnight News: The Delta should get scattered showers Temperatures should be generally below normal.
Chart Analysis: Trends are up with no objectives. Support is at 1581, 1562, and 1554 July, with resistance at 1637, 1656, and 1668 July.

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