While a winter storm is brewing in the western U.S. Plains, May contracts of corn and soybeans held slightly higher in quiet trade. All three wheats fell back from Tuesday’s big gains, ignoring a fourth consecutive day of lower trading in the U.S. dollar.
Midday: Row crops are turning green at midday, with wheat off the lows.
Corn trade is 2 to 3 cents higher at midday with trade firming from early lows based on talks of China securing U.S. corn. South America crop progress looks to remain on track for corn with some shorter-term dryness possible in Brazil on the double crop acres.
Ethanol margins remain under pressure for producers, with the weekly report showing production down slightly, stocks down 523,000 barrels, with ethanol futures up 2 cents.
Corn basis will be supported by ongoing weather issues nearby with Gulf offers struggling along with logistics issues building with the river system to see more stress from melting snow. Early planting is going in the south as well with weather concerns likely to build in the north into March with flooding the main concern.
On the May chart, support is at the $3.61 contract lows which were tested this morning. Resistance is at the $3.69 10-day moving average which we are just below.
Soybean trade is 2 to 4 cents higher with trade remaining choppy at the lower end of the range, but testing $9.00 nearby again. Meal is $1.00 to $2.00 higher with oil is flat to 10 points lower. The trade is looking for more confirmation of Chinese buying and trade progress, with congressional testimony expected today.
South America weather should maintain the recent pattern in the coming days with Brazil harvest moving along and normal progress in Argentina. Crush margins remain strong overall with meal still holding $300 with record February crush expected.
On the May chart support is at the $8.89 1/2 low printed yesterday with resistance at the $9.03 10-day moving average.
Wheat trade is 4 to 7 cents lower at midday with trade seeing selling pressure again after the big bounce yesterday, and another good finish will be needed for broader buying support with trade working back from dime lower trade early on. Winter wheat remains the leader after overnight weakness. Export news has been quieter lately on the world front.
The dollar has come back to 96.70 on the index with choppy trade starting to turn lower. Cooler than normal weather will keep wheat development slow on the Plains, and spring wheat planting likely to start slow this year. Wheat basis varies widely on product and location.
On the May Kansas City chart, support is low at $4.18 3/4 fresh low with resistance at the 10-day at $4.37, which we will need to close above again, and are above at midday.