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Wheat

Wheat markets were lower in response to the USDA WASDE reports. Futures remain in a sideways range on the daily charts. The reports showed less demand to go with less production. Minneapolis held better as production forecasts are lower for spring wheat. The dry weather in other parts of the Great Plains did not appear to make much of a difference to winter wheat production and yields.

Mostly dry conditions are in the forecast for this week in western Texas. Dry conditions remain constant in the northern Great Plains and Canadian Prairies, although some western fringe areas did get some rains. Precipitation is expected to continue in western areas, but eastern areas should stay dry. Kansas also got some beneficial precipitation over the weekend.

Wheat remains a weather market, but the demand side has been weak. Demand remains disappointing, but the production might not be prepared in case of better demand in the coming year. Corn prices are high, so demand for feed wheat could increase.

In overnight news, the southern Great Plains should get isolated to scattered showers. Temperatures should be near to below normal. Northern areas should see scattered showers this weekend. Temperatures will be near normal. The Canadian Prairies should see isolated showers. Temperatures should average near to above normal.

For chart trends, Chicago trends are mixed. Support is at 720, 702, and 701, with resistance at 753, 767, and 769. Trends in Kansas City are mixed. Support is at 683, 667, and 661, with resistance at 705, 722, and 741. Trends in Minneapolis are mixed. Support is at 745, 724, and 710, and resistance is at 774, 784, and 787.

Rice

Rice prices were lower again on what appeared to be speculative selling due to forecasts for increased precipitation and warmer temperatures for US growing areas. The USDA WASDE reports were considered neutral to negative for the trade. Rice areas have generally been wet, although some parts of Texas could use a little rain. Temperatures have been cold, especially in Arkansas, but the crop has been getting planted and is emerging, anyway.

The cash market is working through PL-480 tenders for milled rice. Texas and Louisiana are almost out of rice, but there is rice available in the other states, especially Arkansas. Asian and Mercosur markets were steady to low last week. New crops were a little higher, but July crops were the real movers. Mississippi and Arkansas are actively planting around the rains.

In overnight news, the Delta should get some big rains. Temperatures should be near to above normal. Chart trends appear to be mixed. Support is at 1395, 1389, and 1371, with resistance at 1455, 1462, and 1472.

Corn and Oats

Corn closed lower in response to the USDA WASDE reports. USDA estimated less demand for the coming year than the trade had expected. USDA expects increased competition from the Black Sea and did not cut Brazil corn production as much as the trade has figured. The supply side showed slightly less production than the trade had anticipated, but the overall effect was for higher-than-expected ending stocks estimates. The market remains concerned about the Safrinha crop production in Brazil.

The rains fell from west to east in central Midwest areas and were very beneficial where they fell. Temperatures were cool. Western sections of the Midwest got crops planted with speed, but eastern areas were slower. Emergence has been about average in all areas. Emergence has been slow due to cold temperatures.

Temperatures will be cooler this week and there will be precipitation to keep farmers from the fields. Overall planting conditions should be fairly good over the next week. There are also concerns about the production potential for the Safrinha crop in Brazil as growing areas have been warm and dry, and they look to stay that way longer-term.

Reports indicate that crops are being stressed due to the lack of rain. It is drier in central and parts of northern Brazil. The winter corn crop progress is well behind normal capacity and it has been dry in major growing areas. There are worries that US corn is priced out of the world market as US corn is the highest price of any offering nation, but the lack of production of the second crop in Brazil should mean stronger demand for US corn.

Demand for US corn has been coming in at a stronger pace than estimated by USDA, and it looks like US crops may see significantly less stock than current projections by the end of the year.

In overnight news, ethanol production saw 979,000 barrels per day in the week ending May 7, from 952,000 the previous week and 617,000 last year. The production of ethanol used 98.4 million bushels of corn, from 95.7 million the previous week and 61.6 million last year. Ethanol stocks are seeing 19.4 million gallons, from 20.4 million the previous week and 24.2 million in the same week last year. Corn use totaled 3.377 billion bushels. China bought 680,000 tons of US new corn.

Trends in corn are mixed. Support is at 703, 698, and 684, and resistance is at 732, 736, and 740. Trends in oats are down, with objectives of 378 and 355. Support is at 383, 381, and 370, and resistance is at 400, 410, and 416.

Soybeans

Soybeans and the products closed higher on ideas of strong demand and in response to the WASDE reports. The reports showed strong demand for bio fuels moving forward. Production was at a little less than expected, but so was demand. Ending stocks were a little higher than expected, but still very tight.

Estimates for this year were unchanged. Commercials are thought to be the best buyers. The rally has been led by demand amid a very tight stock situation here in the US. There is still crushing export demand, though it is not as high as before, and the market thinks the US is going to run out of soybeans unless demand can be rationed with high prices.

Some of that rationing is going on as US prices are above offers from South America. The US does not have a lot of soybeans in the country anymore as most producers have already sold out. Buyers are scrambling for what is left. Brazil is rapidly exporting soybeans.

Trends in Soybeans are up with objectives of 1728. Support is at 1615, 1594, and 1575, and resistance is at 1672, 1684, and 1696. Trends in soybean meal are up with objectives of 462.00. Support is at 445.00, 443.00, and 439.00, and resistance is at 458.00, 464.00, and 470.00. Trends in soybean oil are mixed with objectives of 6790. Support is at 6460, 6300, and 6200, with resistance at 6740, 6800, and 6860.

Canola and Palm Oil

Supplies in Indonesia are likely to increase this year, according to the government. The private sources showed that export demand is running ahead of last month so far, but the market fears the loss of Indian demand due to the big coronavirus outbreak. Ideas of tight supplies are still around, but MPOB did show higher-than-expected stocks in its March data.

Canola was sharply lower for July crops, but higher for the other months as new crop concerns continued despite improved growing and planting conditions. There was some rain and snow in western growing areas. Worries about South American production are supporting both markets, as is cold and dry weather in the Prairies.

Demand is thought to be great, with crush margins favoring a lot of production of vegetable oils to feed the demand. The demand for bio fuels is about to increase and is one reason we may see much stronger soybean oil and canola prices.

Trends in canola are mixed with no objectives. Support is at 896.00, 861.00, and 855.00, with resistance at 944.00, 976.00, and 1008.00. Trends in palm oil are up with objectives of 4590. Support is at 4400, 4280, and 4230, with resistance at 4520, 4580, and 4640.