Grains Report - Tuesday, Sep. 12

wheat field

Photo by Polina Rytova on Unsplash

General Comments: Wheat markets closed lower yesterday in anticipation of the WASDE reports to be released on Tuesday, Ideas are that USDA will cut demand and increase ending stocks. Demand has been poor for US Wheat and should remain bad as Russia production looks strong and exports from Russia have not abated. It is certain that there will be no grain deal soon for Ukraine exports through the Black Sea and any export from the Danube will be difficult if not impossible due to bombing by the Russians. Ukraine will still be able to ship via land through the EU but this is considered to be a very expensive option for them. It is unlikely that any ship owner or ship insurer will take the chance on any passage of Ukrainian grain through the Black Sea, and maybe not for Russia, either. The world access to Wheat from at least one and perhaps both countries is a lot more restricted. Weather forecasts call for drier weather for the northern Great Plains and Canadian Prairies and some areas will be real hot. Canada is now suffering potential crop losses due to dry weather.
Overnight News: The southern Great Plains should get isolated showers. Temperatures should be above normal. Northern areas should see isolated showers. Temperatures will average above normal. The Canadian Prairies should see scattered showers. Temperatures should average above normal.
Chart Analysis: Trends in Chicago are mixed to down with objectives of 577 December. Support is at 576, 570, and 564 November, with resistance at 599, 616, and 626 November. Trends in Kansas City are mixed. Support is at 711, 704, and 691 November, with resistance at 736, 755, and 772 November. Trends in Minneapolis are mixed. Support is at 756, 752, and 746 November, and resistance is at 772, 787, and 790 November.

General Comments: Rice closed lower yesterday on what appeared to be speculative follow through selling as he market anticipate a big US production estimate today. Trends are down on the daily charts. Yields are called average to below average in Texas and average so far in Arkansas. The quality has been uneven with some crops affected by the extreme heat in southern areas that has hurt field yields in some areas. Some fields are getting abandoned due to extreme heat affecting the production in a very negative way. India will not allow Rice exports except for Basmati for now because not enough rain in some production areas. Northern areas are too wet and southern areas are too dry. It instituted a new 20% tax on White Rice exports. India is the largest exporter of Rice in the world, so it was big news and one that implies that a sharp increase in world price is once again possible.
Overnight News: The Delta should get isolated showers, mostly near the Gulf coast. Temperatures should be above normal.
Chart Analysis: Trends are down with no objectives. Support is at 1571, 1555, and 1512 November and resistance is at 1600, 1619, and 1640 November.

General Comments: Corn and Oats were a little higher yesterday as bad US growing conditions battled continued to be seen. However, the trade does not anticipate much of a reduced production estimate from USDA tody. CONAB raised its production estimate to just over 131 million tons. Expectations are for stressful weather to continue. Weakness was seen before the WASDE and US production reports to be released on Tuesday on ideas that USDA will show strong production potential once again. Weather forecasts remain mostly dry but with moderate temperatures for the Midwest for the next week. The crops will need rain to maintain the condition due to the lack of soil moisture from three months of drought that ended at the end of June but the crops are not expected to see much rain if any rain at all. A return to hot and dry weather now could impact yields in a bad way. Demand for US Corn in the world market has been very low and domestic demand has been weak due to reduced Cattle and other livestock production. The Brazil Corn harvest is underway and so export prices for Corn from Brazil are getting relatively cheap and Brazil is getting the business.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 474, 471, and 468 December, and resistance is at 507, 517, and 523 December. Trends in Oats are mixed. Support is at 481, 477, and 456 December, and resistance is at 510, 522, and 528 December.

General Comments: Soybeans and the products were a little higher yesterday on what appeared to be speculative trading tied to the release of the WASDE and US production reports on Tuesday. Ideas are that the reports will continue to show strong yield potential. Deteriorating crop conditions as reported by USDA on Tuesday could mean lower yield potential in this report and in coming production estimates. USDA cut the good to excellent categories by five percentage points for both Corn and Soybeans. Highly variable conditions were noted especially in western areas. Weather forecasts call for warm and dry conditions for the Midwest. Most longer-range maps indicate the potential for dry weather. Temperatures are expected to be above normal. Ideas are that the top end of the yield potential is gone and severe damage is becoming possible in some areas. Brazil basis levels are still low, and the US is being shut out of the market for most importers, but the US is price competitive now. Brazil is still selling a lot of Soybeans to China and other countries. Brazil has a very good crop.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed. Support is at 1353, 1338, and 1333 November, and resistance is at 1385, 1395, and 1409 November. Trends in Soybean Meal are mixed to up with objectives of 414.00 and 425.00 October. Support is at 402.00, 393.00, and 389.00 October, and resistance is at 413.00, 416.00, and 423.00 October. Trends in Soybean Oil are down with objectives of 6060 and 5770 October. Support is at 6060, 6000, and 5940 October, with resistance at 6400, 6580, and 6700 October.

General Comments: Palm Oil was lower last week on ideas of weaker demand and strong production. Futures were lower today. The private sources reported that the export pace is behind that of the previous month. Production ideas are strong and are helping to keep rallies in check. Canola was lower yesterday. Drier weather is generally forecast for the Prairies and the crop has been stressed, but some rain is falling now. The StatsCan stocks report showed supplies were above trade expectations.
Overnight News:
Chart Analysis: Trends in Canola are down with objectives of 746.00 and 712.00 November. Support is at 758.00, 754.00, and 747.00 November, with resistance at 790.00, 802.00, and 808.00 November. Trends in Palm Oil are down with no objectives. Support is at 3700, 3680, and 3650 November, with resistance at 3910, 3990, and 4070 November.

More By This Author:

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Softs Report - Monday, September 11
Grains Report - Monday, Sep. 11

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