Wheat higher, corn and soybeans slightly lower ahead of the report release.
Corn trade is 1 to 2 cents lower at midday with trade working sideways ahead of the WASDE report at 11. Early harvest should begin to expand where the rains moderate with much of the belt drying back out this week with warmer temperatures with significant drying needed in some areas with more action likely towards the weekend.
Ethanol margins remain tight with futures still hanging around 1.28 with slightly lower production, and higher stocks this week. Corn basis has held up pretty well in recent days but more harvest pressure will work in.
The delayed weekly crop progress report to yesterday afternoon showed conditions unchanged at 68% good to excellent with one percent moving from good to excellent, and 12% poor to very poor, with 96% dented, 11% above average, 35% mature, 14% above average, and 5% harvested 2% above average.
Expectations for the WASDE report are for corn yield at 177.7 BPA for production of 14.524 billion bushels, down slightly from last month, with ending stocks at 2.027 billion for old crop, and 1.626 billion for new, and world stocks at 154.3 million for new crop. Expectations are for slight carryover reductions.
On the December chart, support is at the 10-day at $3.64 with the 20-day at $3.67 resistance.
Soybean trade scored new lows, trading a dime lower with trade rebounding hear at midday ahead the report and on news that trade talks with China may restart earlier than expected. Meal is $2 to $3 lower, and oil is 10 to 20 points lower.
Basis is expected to see more pressure as storage space will be at a premium once harvest gets rolling forward with this week likely to push maturity ahead with rains lingering in the north. Crush margins remain strong with the recent meal rally, along with outstanding biodiesel margins.
Early planting in South America will be getting underway soon with conditions on the dry side going in, and the Brazil and Argentina currencies remain historically cheap. The weekly crop progress showed better conditions at 68% good to excellent, and 10% poor to very poor, and 31% dropping leaves, 12% above average.
The expectations for the WASDE report are for yield at 52.4, and production at 4.653 billion bushels, up from last month, with carryout at 426 million on old crop, and new crop up to 826 million bushels, with world stocks 107.7 million metric tons vs. 95.7 on old crop. Big supplies are known, just not sure how big. We should have active trade around the report release.
On the November chart, support is fresh lows at $8.21 scored this morning, with the 10-day at $8.38.
Wheat trade is 3 to 8 cents higher with trade trying to work higher after pulling back from Monday’s rally yesterday. The US dollar is chopping along at the lower end of the range and down sharply this morning. Matif wheat is firmer as well.
Russia is expected to catch some rain in the near term while they try to cut spring wheat and plant winter wheat. Australia looks to have more mixed weather in the near term with longer term dryness still an issue as we get closer to harvest there, and crop expectations still dropping. Winter wheat in the U.S. was 5% planted, same as average.
The WASDE report is looking for world wheat stocks at 273.2 million metric tons for old crop, and 257.9 for new, down slightly from last month on new crop.
On the December KC chart we have support at the lower Bollinger Band at $5.06 with resistance the 10-day at $5.32.
The U.S. stock market indices are mixed with the DOW futures up 95. The interest rate products are weaker. The dollar index is 38 lower. Energies are firmer with crude up 1.95. Livestock trade is higher. Precious metals are firmer with gold up 2.90.