Commodity Futures Trading

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Grains Report: Wheat, Rice, Corn and Oats, Soybeans
By: Jack Scoville | March 31, 2023

• WHEAT

General Comments: Wheat markets were mixed yesterday, with SRW lower but HRW and Spring a little higher. In addition, Russia announced it is increasing taxes on exports of Wheat. Cargill and Viterra said that they will shut export programs in Russia and might be bowing to Russian pressure to do so as the country is moving to take more control of the export program. Trends are mostly up on the daily charts. Ideas that big Russian offers and cheaper Russian prices would be a feature for a while in the world market was the driving force for the weaker prices. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. 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.
Overnight News: The southern Great Plains should get mostly dry conditions. Temperatures should be above normal. Northern areas should see scattered snow showers in southern areas. Temperatures will average below normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average below normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 675, 654, and 648 May, with resistance at 712, 724, and 728 May. Trends in Kansas City are mixed to up with objectives of 945 May. Support is at 853, 843, and 823 May, with resistance at 878, 896, and 898 May. Trends in Minneapolis are mixed to up with no objectives. Support is at 860, 846, and 833 March, and resistance is at 892, 899, and 910 May.

• RICE:

General Comments: Rice was lower with most of the weakness in new crop months as the trade expects bigger planted area. Trends are mixed on the May charts. The weekly export sales report showed weaker demand. Demand has been good from domestic sources and offers seem hard to find right now. Export demand has been uneven and was low last week. Export demand has been an issue for the market all year. Mills are milling for the domestic market in Arkansas and are bidding for some Rice. Markets from Texas to Mississippi are called quiet. Demand in general has been slow to moderate for Rice for exports. Planting remains active in Texas and southern Louisiana with field conditions called very good in Louisiana and too dry in parts of Texas.
Overnight News: The Delta should get scattered showers. Temperatures should be above normal.
Chart Analysis: Trends are mixed. Support is at 1739, 1724, and 1712 May and resistance is at 1772, 1800, and 1820 May.

• CORN AND OATS

General Comments: Corn closed a little lower yesterday as traders prepared for the USDA reports that will be released later today. The USDA export sales report came in at the low end of trade expectations. Oats were mixed and trends remain up in this market. US prices are currently very competitive with those from South America as Brazil concentrates on Soybeans exports and not Corn and US demand has improved because of the price differentials and the lack of a Brazil offer into the market. This trend should continue for the next few months if not longer. Prices from South America should now remain strong as countries there concentrate on Soybeans exports and not Corn. The Brazil Summer crop and the Argentine crop is developing under stressful conditions. It has been wet so the Soybeans harvest has been delayed and the Safrinha Corn planting is becoming delayed as well. These delays continue, but the harvest of Soybeans and the planting of Corn is now progressing well. Brazil sources say that 20% of the Winter crop could be planted outside of the ideal window so yields could be hurt in the end. NOAA is forecasting that La Nina will develop this Summer and replace El Nino. US growing conditions are usually good when this happens. However, it is very wet now and some early planting has been delayed.
Overnight News:
Chart Analysis: Trends in Corn are up with objectives of 663 and 681 May. Support is at 643, 638, and 628 May, and resistance is at 655, 660, and 668 May. Trends in Oats are up with objectives of 400 May. Support is at 370, 367, and 362 May, and resistance is at 380, 386, and 388 May.

• SOYBEANS

General Comments: Soybeans the products were mixed yesterday, with Soybean Meal a little higher, Soybean Oil lower, and Soybeans mixed. Traders were getting ready for the release of the USDA reports later today. The trends are mixed in these markets. Reports from Brazil show that basis levels there are under pressure due to the large crop being harvested now. Private analysts say the harvest there is now 70% complete. However, the basis might get higher later in the marketing period as total South American production is probably about the same as last year. Brazil has a very good crop, but the additional Soybeans grown in Brazil will be wiped out by the losses in Argentina. Argentina has been forced to import from Brazil to keeps its crushing facilities operating. Soybeans export demand is flowing to Brazil now. It remains hot but rains are reported in Argentina and crop conditions are getting stable. Forecasts from NOAA for very good growing conditions in the Midwest were also a factor, but there is too much rain in most growing areas right now.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to up with no objectives. Support is at 1462, 1451 and 1445 May, and resistance is at 1500, 1516, and 1532 May. Trends in Soybean Meal are mixed. Support is at 447.00, 435.00, and 422.00 May, and resistance is at 467.00, 475.00, and 485.00 May. Trends in Soybean Oil are mixed. Support is at 5390, 5130, and 5000 May, with resistance at 5600, 5810, and 5980 May.

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