DTN Grain Close: Wheat Continues Rapid Slide; Corn, Soybeans Stabilize

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A combination of fund and technical selling following Thursday’s sharply lower close, a firm U.S. dollar, and weakening European and Russian wheat values have combined to send wheat lower again Friday, with Kansas City reaching new contract lows. Corn and soybeans in dull trade finished little changed and just above the uptrend line. Positive news from China trade talks was tempered as that discussion continues next week in the U.S.

 

Midday: Soybeans lead at midday with trade fading from overnight strength. Wheat is scoring fresh lows at midday due to absence of positive news.

CORN

Corn trade is flat to a penny lower with trade looking to reestablish footing going into the three-day weekend for Presidents Day and spillover pressure from wheat. The second crop in Brazil is being planted in good condition for now with planting heading towards the halfway point with early rains looking to be good for germination. The energy complex is maintaining recent gains to support ethanol a little more in the near term with better seasonal action getting close, but ethanol futures are a penny lower this morning.

Corn basis should firm again with more weather disruptions. The daily wire remained active on corn with 205,744 metric tons of corn sold to unknown. On the March chart trade is just below the resistance clustered at $3.77-$3.79 with support at the lower Bollinger Band at $3.73 3/8, and the then low at $3.71 3/4.

SOYBEANS

Soybean trade is 2 to 3 cents higher at midday moving back towards the middle of the weekly range. Meal is $1 to $2 higher and oil is 5 to 15 points lower.

South America weather should maintain the recent pattern in the coming days with Brazil harvest moving along. Crush margins remain strong with meal holding $300 a ton or better still, with basis likely to remain steady to firmer on weather and the futures pull back. Trade talks will continue in the U.S. next week with some progress scored this week.

On the March chart resistance is now the moving averages clustered at $9.13-9.15 which we just below, and then the $9.01 support level from the early session lows.

WHEAT

Wheat trade is 4 to 9 cents lower with spread trade firming for the Chicago intramonth spreads as well, with KC the weak side of the contract spreads today. The U.S. has seen better export business lately, but world prices have followed the U.S. selloff the last couple of days. The dollar rally has resumed with new highs scored overnight. Cold weather is expected to keep some stress on the Plains in the near term with winter wanting to hang around.

On the March Kansas City chart, support is low at $4.72 with resistance the 10-day at $4.95.

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