DTN Grain Close: Commodity Board Turns Red

©Debra L Ferguson Stock Images

If Wednesday’s trading had a theme, it was that investors are showing more concern about rising interest rates, sending nearly every commodity lower on the day and taking nearly 2% off the Dow Jones Industrials. Among crop prices, soybeans took it the hardest with the November contract falling 10 3/4 cents.

 

Midday: Trade is lower across the board at midday led by soybeans.

CORN

Corn trade is 2 to 3 cents lower with trade working sideways and holding up the best amidst the risk of trade today. Cold weather and rain is expected to continue to keep progress slow in many areas. Ethanol margins remain tight, with E15 confirmed by President Trump last night with futures edging lower this morning.

Corn basis is expected to stay sideways to soft with wet weather limiting weakness in some areas. The weekly crop progress showed conditions unchanged at 68% good to excellent, and 12% poor to very poor with 93% mature vs. 83% on average, and harvest at 34% vs. 26% on average.

The World Agricultural Supply and Demand Estimates (WASDE) report expectations are for corn 2018-19 carryout to come in at 1.932 billion bushels, up from 1.774 in September with yield at 181.8 BPA for production at 14.851 billion bushels, up 0.5 BPA from last month with world stocks at 159.2 million metric tons for 18-19 vs. 157 last month.

The higher September Quarterly Stocks numbers for corn and beans is expected to give us higher carry-in stocks.

On the December chart support is at the $3.59 20-day with resistance at our recent high of $3.69 1/2.

SOYBEANS

Soybean trade is 14 to 16 cents lower at midday with the widespread selling today and overbought conditions triggering liquidation ahead of the report. Meal is $3.00 to $4.00 lower and oil is 30 to 40 points lower.

Soybean basis has found some footing with the delays, although it remains abnormally wide. Crush margins remain strong even with meal and oil swapping leadership at times this week.

Early planting in South America is underway with the recent weather pattern remaining intact. The Brazilian real rally has slowed a bit this morning

The weekly crop progress report showed conditions unchanged at 68% good to excellent, and 10% poor to very poor, with 91% dropping leaves, 6% above average, and harvest at 32% complete, 4% below.

WASDE expectations are for a 860 million bushels 2018-19 domestic carryout on a yield of 53.4 BPA, up 0.6 from last month for production of 4.733 billion bushels, with world stocks up 1.4 million metric tons from last month to 109.4.

On the November chart support is the 50-day at $8.59 which we are testing overnight with the 20-day below that at $8.48 which we are testing at midday, with resistance the overnight high at $8.74 and the upper Bollinger Band at $8.79.

WHEAT

Wheat trade is 2 to 4 cents lower at midday with range-bound trade continuing with trade unable to sustain moves in either direction. The U.S. dollar has faded back towards 95 on the index.

World spring wheat harvest is nearing completion, while winter wheat planting is ongoing with better conditions in North America than Europe progress in the U.S. rated at 57% complete, 3 percentage points ahead of average, with emergence at 30%, 2% ahead of average. Australia remains in the recent weather pattern. The weekly export inspections were at 423,270 tons.

WASDE expectations are for carryout of 1.027 billion bushels domestically, up from 927 in September, and world numbers at 261.1 million, unchanged from last month.

On the December Kansas City chart, we are just below the 10-day and 20-day at 5.18 with the lower Bollinger Band support at 5.05.

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