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Grains Report: Wheat, Rice, Corn and Oats, Soybeans
By: Jack Scoville | February 15, 2023

• WHEAT

General Comments: Wheat markets were mostly lower yesterday in Chicago but a little higher in Minneapolis after a choppy session. News that Russia has launched a new offensive in Ukraine provided much of thew support on Monday but there was no real new yesterday about the war to propel futures higher. Russia appears to be sending three divisions across the border to fight and it looks as though this could be a major operation for the Russian army. Fears of deliveries of Wheat from the Black Sea will be cut significantly are surfacing again. Trends are turning up in all three markets on the daily and weekly charts. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. Russia is said to be plotting a huge new invasion of Ukraine that could prevent farmers in Ukraine from harvesting Wheat and planting Corn. Russia has a large production and is undercutting most world prices in the international market. However, Russian production estimates have dropped recently. The demand for US Wheat in international markets has been a disappointment all year and has been hindered by low prices and aggressive offers from Russia. Ukraine is also looking for new business for its crops and Russia is aggressive in the world market as it looks for cash to fund the war.

Overnight News: The southern Great Plains should get scattered showers. Temperatures should be variable. Northern areas should see isolated to scattered showers. Temperatures will average below normal. The Canadian Prairies should see isolated showers. Temperatures should average near to below normal.

Chart Analysis: Trends in Chicago are up with objectives of 802 and 834 March, Support is at 776, 766, and 757 March, with resistance at 809, 818, and 827 March. Trends in Kansas City are up with objectives of 936 March. Support is at 898, 888, and 877 March, with resistance at 916, 925, and 946 March. Trends in Minneapolis are mixed to up with objectives of 933, 948, and 968 March. Support is at 925, 912, and 907 March, and resistance is at 936, 942, and 946 March.

• RICE:

General Comments: Rice was lower again yesterday on what appeared to be some speculative profit taking and new commercial selling. Prices above $18.00/cwt offer good profits for farmers and reports indicate that they have been selling. Demand has been good from domestic sources but domestic users are hoping to buy cheaper. Export demand has been uneven. Demand has been an issue for the market all year. There is not much going on in the domestic market right now although mills are milling for the domestic market in Arkansas and are bidding for some Rice and although some Rice moved in Tein quiet trading at what were called very good prices. Demand in general has been slow to moderate for Rice for exports and solid for domestic uses.

Overnight News: The Delta should get mostly dry conditions. Temperatures should be below normal.

Chart Analysis: Trends are up with no objectives. Support is at 1760, 1746, and 1735 March and resistance is at 1790, 1801, and 1819 March.

DJ USDA World Market Rice Prices – Feb 15

USDA today announced the prevailing world market prices

of milled and rough rice, adjusted for U.S. milling yields

and location, and the resulting marketing loan gain (MLG)

and loan deficiency payment LDP) rates. Source: USDA

—–World Price—– MLG/LDP Rate

Milled Value Rough Rough

($/cwt) ($/cwt) ($/cwt)

Long Grain 18.69 11.75 0.00

Medium/Short Grain 18.32 12.18 0.00

Brokens 10.87 —- —-

This week’s prevailing world market prices and MLG/LDP

rates are based on the following U.S. milling yields and

the corresponding loan rates:

U.S. Milling Yields Loan Rate

Whole/Broken ($/cwt)

(lbs/cwt)

Long Grain 54.28/14.78 7.00

Medium Grain/Short Grain 60.31/10.41 7.00

• CORN AND OATS

General Comments: Corn and Oats closed lower yesterday with much of the selluing related to the CPI data released by the US government that showed inflation was still strong. Ideas are that the FED will continue to try to control inflation for a while and that could create a recession.. The short term trend is now sideways in Corn and down in Oats. The export demand was solid last week even though demand remains well behind the pace to make USDA objectives. Brazil has been hanging on for its Summer crop although losses are now being reported. Argentina has suffered through some extreme drought and losses could be large. The Brazil Winter crop is harvested and China is buying the surplus. The Summer crop and the Argentine crop is developing under stressful conditions. The next Winter crop is going into the ground in good conditions, but it has been wet so the Soybeans harvest has been delayed and the Corn planting is becoming delayed as well. There are concerns about demand with the Chinese economic problems caused by the lockdowns creating the possibility of less demand as South America has much better crops this year to compete with the US for sales. China is now moving rapidly to open the economy and allow people to move around with no lockdowns so the demand could start to improve

Overnight News: Mexico bought 213,370 tons of US Corn.

Chart Analysis: Trends in Corn are mixed to up with objectives of 701, 710, and 737 March. Support is at 678, 672, and 669 March, and resistance is at 689, 693, and 698 March. Trends in Oats are down with objectives of 358 March. Support is at 363, 361, and 351 March, and resistance is at 375, 382, and 389 March.

• SOYBEANS

General Comments: Soybeans and Soybean Meal were lower yesterday as the CPI data showed that the FED would likely need to work harder to control inflation. Soybean oil closed a little higher. It remains hot and dry in Argentina and southern Brazil and crop conditions are getting worse. It will turn cooler this week in Argentina but it should stay dry. Central and northern Brazil have seen harvest operations interrupted with too much rain. Soybean Meal saw strong weekly export sales as Argentina is having to withdraw from the market for Soy products sales due to the drought in the country and the fact that they have already sold a lot of Soybeans into the world market. They are now buying from Brazil. The harvest in Brazil is slowly expanding in central and northern areas. These areas have seen too much rain and the harvest has been slow. Production potential for the Brazil is called very strong even with potential problems and losses in the south. Argentine production ideas continue to drop with the drought as planting is delayed and the crops already in the ground are stressed. Ideas that Chinese demand will improve, but this could take a few more weeks as a very large part of the population now has Covid. This has delayed a robust economic return for the country.

Overnight News:

Chart Analysis: Trends in Soybeans are up with objectives of 1582 and 1619 March. Support is at 1545, 1528, and 1511 March, and resistance is at 1556, 1562, and 1574 March. Trends in Soybean Meal are up with objectives of 515.00, 528.00, and 568.00 March. Support is at 4500.00, 488.00, and 478.00 March, and resistance is at 508.00, 514.00, and 520.00 March. Trends in Soybean Oil are mixed. Support is at 5960, 5890, and 5840 March, with resistance at 6150, 6240, and 6360 March.

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